The National Milk Producers Federation class action lawsuit has reached a settlement agreement. The antitrust lawsuit was filed by Matthew Edwards et al. against defendants NMPF, also known as Cooperatives Working Together, Dairy Farmers of America, Land O’ Lakes, Dairylea Cooperative, and Agri-Mark in the Northern District Court of California. The suit alleges that the defendants engaged in a nationwide conspiracy to limit milk production with the goal of inflating retail prices of milk and milk products.
According to the lawsuit, the defendants actively engaged in recruiting dairy farmers to help fund the CWT herd retirement program. The scheme began in 2003 by requiring farmers to participate by donating a set amount of money per hundredweight of milk that each farm produced during July. At the end of July, CWT began accepting bids from farmers for participation in the program. Farmers that participated were paid for selling all of their dairy cows to slaughter. In this way, CWT was paying the farmers not to produce milk. The result was a loss of 609.2 million pounds of milk, and the premature loss of life of thousands of cows.
From 2003 through 2010, the defendants operated the herd retirement program. In 2009, CWT instituted a policy that any farmer that participated in the program must agree not to produce milk for one year. In 2010, 9,672 billion pounds of milk were removed from the market. The program was discontinued in 2011 because CWT was no longer making as much money from it. The result of the program when it was active has been a steady climb in the price of milk and milk products. It has also effectively removed thousands of its competitors from the market over the time span that the program was in operation.
The settlement is for $52 million in recovery for class members. A hearing will be held on December 16, 2016 at the Northern District Court in Oakland, California, when the judge will consider whether to approve the settlement or take some other action.
The states that are included in the lawsuit are Arizona, California, Kansas, Massachusetts, Michigan, Missouri, Nebraska, Nevada, New Hampshire, Oregon, South Dakota, Tennessee, Vermont, West Virginia, Wisconsin and the District of Columbia. Individuals in those states that have purchased milk and milk products, including cream, cottage cheese, cream cheese, sour cream, half & half, and yogurt between 2003 and the present date are eligible to submit a claim. The deadline for claims is January 31, 2017.
This is a case of big business attempting to make tons of money on the backs of dairy farmers and consumers. It is mind boggling that the program was widely advertised and in operation for seven years with no repercussions. The class action lawsuit was not filed until 2014, four years after the program ended. I wonder how many other companies are engaged, illegally, in activities designed to artificially raise prices on consumer goods that have not been investigated and sued.