Brigette Honaker  |  August 15, 2018

Category: Consumer News

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A $40 million settlement has been proposed in a California class action which alleges that DairyAmerica and California Dairies boosted their profits by reporting lower milk prices when paying farmers.

On Aug. 13, plaintiffs in a milk prices class action asked a California federal judge to approve the $40 million settlement which would resolve litigation that has been ongoing since 2009.

In the nearly 10 years of litigation, the case has been consolidated, dismissed, and revived which makes the potential settlement a welcome relief, according to statements made by both parties.

“The court should preliminarily approve the proposed settlement as fair, reasonable, and adequate because it provides for the putative settlement class a cash payment of $40 million,” the plaintiffs argue in their milk prices settlement proposal. “That amount constitutes a remarkably substantial share of the damages incurred by the putative settlement class as a result of defendants’ alleged misconduct, i.e., the misreporting of non­fat dry milk to the United States Department of Agriculture.”

Class Members eligible for the settlement include all U.S. dairy farmers who, between Jan. 1, 2002 and Apr. 30, 2007, sold raw milk priced according to a Federal Milk Marketing Order, government-set provisions which determine milk prices. The proposed $40 million is equal to 80 percent of the Class Members’ alleged financial damages, as has been calculated by the U.S. Department of Agriculture.

“This settlement provides an excellent recovery for thousands of dairy farmers who were financially harmed when defendants misreported data to the federal government,” the lead counsel for plaintiffs told Law360.

The original milk pricing class action claimed that DairyAmerica Inc. and California Dairies underreported milk prices to the U.S. Department of Agriculture’s National Statistics Service. This conspiracy allegedly intended to lower the government-set milk prices they were required to pay farmers for nonfat dry milk.

Nonfat dry milk is commonly used in the manufacturing of dairy products such as butter and cheese. Because the companies are responsible for marketing and selling an estimated 75 percent of nonfat dry milk in the country, they allegedly made a large profit at the expense of dairy farmers.

Although the defendants have agreed to a settlement, they continue to deny any wrongdoing associated with the milk price class action lawsuit.

“DairyAmerica and CDI vigorously deny any claims of wrongdoing, and there has been no admission or court finding of liability for any claims,” a representative for DairyAmerica and California Dairies said in a statement to Law360. “For DairyAmerica and CDI, settling these claims provides a way to bring closure to a long legal process, avoid the expense and uncertainty of further protracted litigation, and return their primary focus to their businesses and their members.”

Plaintiffs are represented by Joseph J. Tabacco, Christopher T. Heffelfinger, and A. Chowning Poppler of Berman Tabacco; Lynn L. Sarko, Mark A. Griffin, Cari C. Laufenberg, and Ron Kilgard of Keller Rohrback LLP; and Benjamin D. Brown and George Farah of Cohen Milstein Sellers & Toll PLLC.

The DairyAmerica Milk Price Class Action Lawsuit is Carlin, et al. v. DairyAmerica Inc., et al., Case No. 1:09-cv-00430-AWI-EPG, in the U.S. District Court for the Eastern District of California.

UPDATE: January 2019, the DairyAmerica milk pricing class action settlement is now open. Click here to file a claim.

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74 thoughts onDairyAmerica Agrees to $40M Milk Pricing Class Action Settlement

  1. miguel A mercado says:

    Add me please

  2. Tony Marcelino says:

    Milk price law suite
    Add me.

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