Pilgrim’s Pride has agreed to a $31 million cash settlement in a Delaware derivative and class action tied to a 2024 charter amendment and tax-sharing deal with controlling stockholder JBS.
The settlement amount is structured as an additional payment from JBS to Pilgrim’s Pride, above the roughly $50 million already expected to flow to the company under the Tax Sharing Agreement. Under the deal, JBS will make an initial $250,000 deposit into an escrow account controlled by plaintiffs’ counsel, with the remaining $30.75 million going into an escrow account controlled by Pilgrim’s Pride. After deductions for fees, taxes and notice costs, the money is to be transferred to the company no later than 10 business days after the settlement becomes effective.
The case centers on actions taken in late 2024. On Oct. 25, 2024, Pilgrim’s Pride disclosed that its board had approved a charter amendment and a Tax Sharing Agreement with JBS. The amendment set the board at 10 directors as long as JBS held at least 80% of the company’s outstanding shares and gave JBS the right to elect eight directors. The company later rescheduled a special stockholder meeting from Dec. 4 to Dec. 23, 2024, and stockholders approved the charter amendment, which became effective Dec. 30, 2024.
Plaintiffs filed their derivative and class complaint on July 17, 2025. Defendants moved to dismiss on Oct. 1, 2025, and the briefing continued through December. The court later pushed the dismissal hearing from April 6, 2026 to Oct. 1, 2026. Before that hearing, the parties went to mediation on March 31, 2026, with former U.S. District Judge Layn R. Phillips serving as mediator. The mediation did not produce an immediate deal, but the mediator later recommended settlement on the $31 million payout, which the parties accepted.
The settlement class covers holders of Pilgrim’s Pride common stock issued and outstanding from Sept. 1, 2024 through Dec. 30, 2024. The notice says the class is non-opt-out. Individual stockholders will not receive direct payments; the recovery goes to the company.
The settlement is aimed at claims that the charter amendment and tax-sharing arrangement gave JBS non-ratable benefits by allowing it to consolidate Pilgrim’s Pride’s financials for tax purposes and by failing to equitably divide the tax benefits between the company and JBS. As a result of these announcements, the company's shares have moved 1.86% on the market, and are now trading at a price of $31.69. Check out the company's full 8-K submission here.
