The Dairy Farmers of America (DFA), a dairy-farmer cooperative that has been accused of conspiring with four other organizations to suppress milk prices paid to dairy farmers across 14 US states, has agreed to pay $158.6m to settle the antitrust lawsuit.
The settlement, which needs approval of the court, would mean the company will avoid a trial, which was to begin this month in Greeneville, Tennesse.
According to the class-action lawsuit filed in 2007 by plaintiffs, DFA along with other defendants like Dallas-based milk bottler Dean Foods, DFA's National Dairy Holdings and DFA's finance subsidiary Mid-Am Capital had taken several steps to control milk prices.
The plaintiffs alleged that DFA entered into exclusive supply contracts with Dean Foods, which excluded competition from independent milk farmers and cooperatives in the 14 states across the southeast.
Dean Foods had already reached settlement in 2011 and paid $140m. DFA will now pay $140m to plaintiffs and another refundable $18.6m into a fund over two years, which farmers can avail if market conditions are unfavourable.
Attorney Robert Abrams of Baker & Hostetler, which represented the plaintiff in the deal, said the monetary settlements are substantial.
