Ahold Class Action Settlement Now Final
The appeal period regarding court approval of Ahold’s settlement of a U.S. class action has expired, making the settlement final. In May 2014, the Netherlands-based retail conglomerate reached the settlement in a case involving the pricing practices of its former subsidiary U.S. Foodservice during the period 1998-2005. The settlement was subject to the approval of the U.S. District Court for the District of Connecticut.
Following the court's December 2014 approval of the settlement, Ahold paid $297 million in return for a release from all claims from all participating class members in relation to allegations that U.S. Foodservice overcharged customers.
Ahold indemnified U.S. Foodservice against damages arising from the class action, referred to the company's annual reports as the "Waterbury litigation," as part of the terms of Ahold's July 2007 sale of the subsidiary to a consortium of Clayton, Dubilier & Rice and Kohlberg, Kravis Roberts & Co for $7.1 billion.
The class action comprised any person in the United States who bought products from U.S. Foodservice under an arrangement defining a sale price in terms of a cost component, in addition to a markup, and for which U.S. Foodservice used a so-called "Value Added Service Provider" transaction to calculate the cost component.
In May, Lodewijk Hijmans van den Bergh, a member of the Ahold management board and the company's chief corporate governance counsel, who is to be succeeded by Jan Ernst de Groot, noted that the settlement "permits us to avoid more lengthy, time-consuming and costly litigation, and to focus our resources and attention to our current business."