March 13, 2004 -- CropChoice news -- Associated Press:
Two grain processing firms have proposed paying
a combined $24 million to settle a nearly decade-old
civil lawsuit that alleges they conspired to fix the
price of high fructose corn syrup, a sweetener used
in products ranging from soft drinks to pasta sauces.
Minneapolis-based Cargill Inc. and American Maize Products
of Stamford, Conn., filed the no-fault settlement offer
in federal court in Peoria this week after a year of
negotiations with attorneys representing plaintiffs,
which include Coca-Cola and Pepsi.
"We believe the settlement is fair and reasonable
for the class," said Gregory Arenson, an attorney
If approved, only two defendants would remain in the
class-action lawsuit, which was filed in 1995 by about
20 corn syrup buyers. The case against Archer Daniels
Midland Co. and A.E. Staley Manufacturing Co. is scheduled
for a September trial.
Arenson said the settlement with Cargill and American
Maize could potentially extend to about 2,700 plaintiffs
who bought the corn-based sweetener from any of the
four defendants or their subsidiaries from 1991 to 1995.
U.S. District Judge Michael Mihm approved a schedule
Thursday that gives plaintiffs until May 10 to comment
on the settlement offer or to raise objections. A hearing
to rule on the proposed deal will be May 19.
The $24 million has already been placed in an escrow
account and is collecting interest, which also will
be distributed to plaintiffs if the deal is approved,
according to court records.
The lawsuit grew out of a federal investigation into
ADM's involvement in a price-fixing scandal involving
the livestock feed supplement lysine and citric acid,
used in food, detergents and other products.
ADM pleaded guilty to federal antitrust charges in
that case and was fined $100 million, but received immunity
from all other charges. The company was never convicted
of fixing corn syrup prices.
Three former ADM executives received prison sentences
in 1999 as a result of the price-fixing scandal.
The original corn syrup suit also named a fifth defendant,
New Jersey-based CPC International Inc., which settled
for $7 million in 1996.