Dean Foods has agreed to a $140m settlement for a class action lawsuit in which Southeast Dairy Farmers and Dairy Farmers of America had accused it of working to keep prices artificially low.
Under the proposed agreement, Dean Foods would make an initial payment of $60m into a fund for distribution to dairy farmer class members and subsequent payments of $20m each year for the following four years.
Chairman and CEO Gregg Engles said in a statement: "We continue to be confident that we have operated lawfully and fairly at all times in the Southeast. We believe this settlement is in the best interest of our shareholders, employees, customers and consumers. Settling this case allows us to focus on the business challenges that we face, and to continue to take costs out of our operations while avoiding the expense, uncertainty and distraction of a protracted litigation and the likelihood of a lengthy appeals process."
A trial had been scheduled to begin next month.