Remaining Defendants Settle in Southeastern Milk Antitrust Litigation

On January 21, 2013 – literally the eve of trial — counsel for a plaintiff class of approximately 7,200 current and former dairy farmers filed a motion for expedited preliminary approval of a proposed $158.6 million settlement agreement dated January 17, 2013, with Dairy Farmers of America, Inc. (DFA) and all other remaining defendants in the Southeastern Milk Antitrust Litigation. With this latest proposed settlement, the plaintiff class has achieved total cash settlements exceeding $300 million: $158.6 million in this settlement, plus $140 million from Dean Foods and $5 million from Southern Marketing Agency and James Baird in settlements that were approved by Judge Ronnie Greer in June 2012.

Baker Hostetler stated in a news release that: “In addition to the monetary award, DFA agreed to change its business conduct in the Southeast, including taking steps to increase raw milk prices [paid to farmers]; removing cancellation penalties on certain full-supply agreements with bottling plants and not entering into new full supply agreements during the Settlement’s term; modifying membership agreements to improve farmer ability to change cooperatives; enhancing price-related information on milk checks; boosting transparency through auditing and disclosure commitments; and facilitating delegate votes on additional meaningful changes to conduct.”

According to the motion for expedited preliminary approval, the other settling defendants in the January 22, 2013 settlement are Dairy Marketing Services, LLC, Mid-Am Capital LLC, National Dairy Holdings, LP and Gary Hanman.

The plaintiffs allege a conspiracy to artificially lower the price paid to dairy farmers in the southeast U.S. for fluid Grade A milk in violation of Sherman Act section 1; and monopolization, attempted monopolization and monopsonization, and conspiracy to monopolize and monopsonize in violation of Sherman Act section 2. The parties have been litigating for five and a half years according to the motion for expedited preliminary approval.

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