Post Holdings Inc., the owner of Michael Foods Inc., is paying a $75 million settlement to settle an egg-related class action lawsuit.
On December 8, the St. Louis-based food company announced it will settle all class claims asserted by direct purchasers of shell eggs against Michael Foods. The suit, filed in 2008, claims the U.S. egg industry illegally conspired to inflate prices.
“While we remain confident that our conduct has at all times been lawful and entirely appropriate, we believe this settlement is in the best interest of our shareholders, employees, customers and consumers because it effectively eliminates the distraction, expense, and exposure of this complex litigation,” CEO Rob Vitale, said in a press release.
The settlement must be formally documented and approved by the court, but Post expects the settlement will be approved.
The suit alleges the U.S. leading egg producers conspired to use new welfare standards which included uniform hen spacing and housing standards to artificially reduce egg supply and hike egg prices. In September, Michael Foods won a decision in the same long-running case.
In July 2013, Cal-Maine Foods Inc. agreed to pay a $28 million settlement to settle all direct purchaser claims. Other companies involved with litigation include: National Food Corp. which settled for $1 million, Midwest Poultry Services LP for $2.5 million, United Egg Producers Inc. and U.S. Egg Marketers Inc. for $500,000, NuCal Foods Inc. for just over $1.4 million and Hillandale Farms Inc. for $3 million.
Michael Foods, purchased by Post in 2014, is one of the largest egg producers in the U.S. and the world. It’s layer flock contains 13.45 million hens.
