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Cal-Maine Foods, Inc. Settles Egg Antitrust Class Action Claims



  Cal-Maine Foods, Inc. Settles Egg Antitrust Class Action Claims

Business Wire

JACKSON, Miss. -- July 23, 2013

Cal-Maine Foods, Inc. (NASDAQ: CALM) today announced that it has reached an
agreement in principle to settle all direct purchaser class claims against the
Company. Pursuant to the agreement, reached in the In re Processed Egg
Products Antitrust Litigation matter pending in Pennsylvania federal court,
Cal-Maine will settle all direct purchaser class claims with a single $28
million payment.

“We remain confident that our conduct has at all times been lawful,
appropriate and fair to our customers. The largest retailers and egg buyers in
the country, including many of our customers, in fact, were fully aware of,
and explicitly supported, the industry-wide animal welfare guidelines
challenged in this litigation. And, the USDA was fully aware of, and
explicitly supported, these animal welfare guidelines as well as all the other
conduct the plaintiffs challenged,” said Dolph Baker, chairman, president and
chief executive officer of Cal-Maine Foods, Inc. “We were able to negotiate a
settlement which would eliminate most of our exposure in the antitrust
litigation against the Company for an amount that we believe is in the best
interest of the shareholders, employees, customers and consumers. It
significantly reduces the distraction, expense, exposure and inconvenience of
protracted litigation and potentially multiple appeals, and allows us to focus
on executing the long-term strategy of our business.”

The terms of the settlement must be formally documented and are subject to
approval by the court following notice to all class members. The Company will
record a pre-tax charge in the fourth quarter of fiscal 2013 of approximately
$28 million with respect to the settlement, which amounts to $17 million,
$0.71 per basic share, after tax. Cal-Maine does not expect other provisions
associated with the settlement to have a material impact on its results of
operations. While the Company expects the settlement will receive the needed
approval, there can be no assurance that the court will approve the agreement
as proposed by the parties.

The plaintiffs in the non-class cases that direct purchasers have filed
against the Company may elect to participate in the settlement or to opt out
and pursue their individual claims. The settlement does not affect the class
actions filed on behalf of indirect purchasers. These non-class cases and the
indirect purchaser class actions also allege that the Company and certain
other large domestic egg producers conspired to reduce the domestic supply of
eggs in an effort to raise egg prices. Cal-Maine intends to continue to
vigorously defend the remaining cases and believes it has strong defenses.

Cal-Maine Foods, Inc. is primarily engaged in the production, grading, packing
and sale of fresh shell eggs, including conventional, cage-free, organic and
nutritionally-enhanced eggs. The Company, which is headquartered in Jackson,
Mississippi, is the largest producer and distributor of fresh shell eggs in
the United States and sells the majority of its shell eggs in approximately
29 states across the southwestern, southeastern, mid-western and mid-Atlantic
regions of the United States.

Statements contained in this press release that are not historical facts are
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. The forward-looking statements are based on
management’s current intent, belief, expectations, estimates and projections
regarding our company and our industry. These statements are not guarantees of
future performance and involve risks, uncertainties, assumptions and other
factors that are difficult to predict and may be beyond our control. The
factors that could cause actual results to differ materially from those
projected in the forward-looking statements include, among others, (i) the
risk factors set forth in Item 1A of our Annual Report on Form 10-K for the
fiscal year ended June 2, 2012, as updated by our subsequent Quarterly Reports
on Form 10-Q and Current Reports on Form 8-K), (ii) the risks and hazards
inherent in the shell egg business (including disease, pests, weather
conditions and potential for recall), (iii) changes in the demand for and
market prices of shell eggs and feed costs, (iv) risks, changes or obligations
that could result from our future acquisition of new flocks or businesses, and
(v) adverse results in pending litigation matters. SEC filings may be obtained
from the SEC or the Company’s website, www.calmainefoods.com. Readers are
cautioned not to place undue reliance on forward-looking statements because,
while we believe the assumptions on which the forward-looking statements are
based are reasonable, there can be no assurance that these forward-looking
statements will prove to be accurate. Further, the forward-looking
statements included herein are only made as of the respective dates thereof,
or if no date is stated, as of the date hereof. Except as otherwise required
by law, we disclaim any intent or obligation to update publicly these
forward-looking statements, whether as a result of new information, future
events or otherwise.

Contact:

Cal-Maine Foods, Inc.
Dolph Baker, Chairman, President and CEO
Timothy A. Dawson, Vice President and CFO
601-948-6813
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