The plaintiffs (generally larger retailers and companies who directly purchased butter and cheese from CWT member cooperatives) in First Impressions Salon, Inc. v. National Milk Producers Federation et al, (pending in the U.S. District Court for the Southern District of Illinois), and defendant NMPF have agreed to a settlement of $220 million in exchange for a release from all claims. Based on antitrust rules that mandate a tripling of any damages, that amount is less than 6 percent of the damages sought by plaintiffs. The settlement amount will be paid through existing CWT mechanisms, ensuring no disruption to other business operations.
Neither NMPF nor any of its member cooperatives admit any wrongdoing as a result of this settlement. NMPF is the sole defendant to be a party to the settlement, but the settlement extinguishes claims against all the defendants.
The plaintiffs’ litigation sought damages relating to the so-called Herd Retirement Program operated under Cooperatives Working Together. The program offered dairy farmers financial incentives to market their milking herds for beef. It operated between 2003 to 2010 and was openly lauded by USDA secretaries and congressional agriculture committee chairmen from both parties at the time as an important, appropriate way to help struggling dairy farmers.
NMPF’s decision to enter into this settlement recognized the uncertainties inherent in any jury trial, the very large damages sought by the plaintiffs and the fact that the successful Export Assistance Program is entirely unaffected by the settlement. In 2018, CWT assistance aided 57 percent of American-type cheese exports, 44 percent of butter exports, and 39 percent of whole-milk powder shipments, helping U.S. dairy producers expand trade relationships in an extremely challenging world trade environment.