A California federal court was asked Monday to approve a $40 million settlement to resolve putative claims for tens of thousands of dairy farms alleging that cooperative DairyAmerica Inc. and affiliate California Dairies conspired to boost profits by lowballing milk prices paid to farmers.
The agreement will wrap nearly a decade of hard-fought litigation that started in 2009 when several dairy farmers sued, saying DairyAmerica misreported dairy product prices to the U.S. Department of Agriculture's National Agricultural Statistics Service to lower the government-set amount its members would have to pay farmers for nonfat dry milk under provisions set under what’s known as a Federal Milk Marketing Order.
The operative complaint, the fifth version filed, claims that DairyAmerica had a “singular mission” to maximize the profits of its nine member cooperatives, including California Dairies Inc. During the alleged class period, DairyAmerica marketed and sold approximately 75 percent of the nonfat dry milk produced in the United States.
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“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 attorney for the plaintiffs, George Farah of Cohen Milstein Sellers & Toll PLLC, told Law360 in an email Monday.
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The case is Carlin et al. v. DairyAmerica Inc. et al., case number 1:09-cv-00430, in the U.S. District Court for the Eastern District of California.