The head of Pilgrim's Pride Corp. is taking a leave of absence to focus on his defense in an ongoing federal investigation into price fixing in the chicken industry.
Jayson Penn, the CEO and president of Pilgrim's Pride who was indicted last week on charges of conspiring to fix prices and rig bids for broiler chickens from 2012 to 2017, began a paid leave of absence this week. The company reaffirmed its commitment to "free and open competition" in the market and said Penn will "focus on his defense of the recently disclosed indictment against him, to which he has pleaded not guilty."
Penn, along with former Pilgrim's Pride Vice President Roger Austin and two executives from Claxton Poultry in Georgia, are accused of exchanging phone calls and emails to raise the prices of broiler chickens, including those processed and packaged at the company's two plants in Chattanooga.
In November 2014, Penn allegedly sent a series of emails about a competitor who was selling its chickens for less and asked to buy birds from Pilgrim's to cover a shortfall in a grocery contract, according to the indictments by the U.S. Department of Justice. Penn allegedly said the company should have to pay for not being able to provide the promised number of chickens.
"It costs money for them to fill orders for which they don't have the chickens. They have been adding market share and still trying to do - selling cheap chicken and being short. Doesn't make sense. We are enabling the town drunk by giving him beer for Thanksgiving instead of walking him into an AA meeting," Penn wrote, according to the indictment.
Pilgrim's Pride is a division of JBS USA, the U.S. subsidiary of Brazilian meat production giant JBS SA. Pilgrim's Pride has more than 54,000 employees and 36 production facilities, including about 1,200 employees at two plants in downtown Chattanooga.
Pilgrim's board of directors has appointed Fabio Sandri, the company's chief financial officer, as interim president.
"Pilgrim's operates with the highest standards of integrity and is committed to free and open competition that benefits both customers and consumers," Gilberto Tomazoni, chairman of Pilgrim's board, said in a statement released Sunday. "The board takes the recent allegations very seriously and believes it is in the best interests of both Jayson and the company that he is given the opportunity to focus on his legal defense during this time. Jayson has built a strong leadership team at Pilgrim's. The board has complete confidence in the ability of Fabio and the team to continue to implement Pilgrim's strategy and successfully run day-to-day operations."
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The Associated Press contributed to this report
Company photo by Pilgrim's Pride / Jayson Penn