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Judge Gives 1st OK To Settlement With Farmers

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MONTPELIER, Vt. (AP) — A Vermont judge has granted preliminary approval to a settlement that would require dairy processor Dean Foods Co. to pay Northeast farmers and their attorneys $30 million to settle antitrust allegations.

The Dallas-based company and the plaintiffs removed part of the proposed deal that would have required Dean to temporarily change its milk-buying practices in the region, because the company said it had already started to buy from independent farmers.

The settlement, which was given preliminary approval by U.S. District Court Judge Christina Reiss on Wednesday, stems from a class-action lawsuit that accused Dean Foods; the cooperate Dairy Farmers of America; and the cooperative’s marketing arm, Dairy Marketing Services, of working together to monopolize the market for raw milk in the Northeast, resulting in lower prices paid to dairy farmers.

In its settlement, Dean does not admit any wrongdoing. An attorney said the plaintiffs are moving forward with the case against the other two defendants.

Dean would pay $30 million to be divided among 9,000 to 10,000 farmers as well as the attorneys in the case, which amounts to an estimated average payment to farmers of between $2,500 and $5,700, according to the plaintiffs’ attorney. The settlement covers farmers in Delaware, Connecticut, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Virginia and the District of Columbia.

We “believe this is a very good outcome for the farmers represented in this case,” said Benjamin Brown, a Washington-based attorney for the plaintiffs.

The settlement will get a full review at a July 18 hearing to determine whether it’s “fair, reasonable and adequate.” Class members, who will soon be notified, will have a chance to object to it at the hearing.

Dean Foods looks forward to the hearing, said Dean spokeswoman Liliana Esposito.

Dairy Farmers of America and Dairy Marketing Services opposed the settlement, but their objections are now moot since the provision has been removed that would have required Dean to get 10 to 20 percent of the raw milk it buys for three Northeastern plants from sources other than DMS for 30 months, the judge said.

The judge also denied requests from a group of Maine farmers to intervene in the lawsuit and additional farmers in Pennsylvania, New York, Massachusetts, Maine and Vermont to join in the preliminary approval process.

“To the extent the remaining interveners believe that plaintiffs and proposed class counsel cannot adequately represent their interests, they may present their concerns at the court’s fairness hearing,” she wrote.

(Copyright 2011 by The Associated Press. All Rights Reserved.)

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