Dairy marketing cooperative The Dairy Farmers of America and four co-defendants have reached a $158.6 million settlement in a class action lawsuit, according to Reuters.
The lawsuit was filed by a group of dairy farmers after the co-operative, National Dairy Holdings LP, Dairy Marketing Services LLC, Mid-Am Capital LLC and Gary Hanman, the Dairy Farmers of America’s former chief executive were accused of a conspiracy to control raw milk supplies in the south east of the US.
It was the third and final settlement in the litigation brought by the dairy farmers after previously securing a $140 million settlement with Dean Foods Co and the Southern Marketing Agency. A former Dairy Farmers of America executive also agreed a $5 million settlement in the supply scandal.
The dairy farmers first filed lawsuits against the Dairy Farmers of America after accusing the co-operative of signing an exclusive raw milk supply deal with Dean Foods in breach of competition of rules. The plaintiffs alleged that the agreements prevented competition from independent milk producers in fourteen states in the south east of the US.
The settlement, which is subject to court approval, is likely to avoid a trial.
Richard Smith, the Dairy Farmers of America’s president and chief executive said that the settlement was not an admission of guilt and that the agreement would not hit co-op members.
“The co-operative remains healthy and we're looking forward to getting this behind us," said Smith.
