Plaintiffs argue to add Maple Leaf Foods to a class-action lawsuit for alleged price-fixing conspiracy
Maple Leaf Foods Inc. is asserting its innocence in an alleged bread price-fixing scheme as it faces a hearing that will determine whether it will be added to an ongoing class-action lawsuit.
According to Financial Post, the company released a statement on Wednesday denying any involvement in the conspiracy.
“As we’ve said before, Maple Leaf Foods has done nothing wrong here,” the company stated on its website. When the class-action lawsuit was certified in 2021 by an Ontario court, it included several grocery retailers and food companies but did not name Maple Leaf.
Plaintiffs are preparing to argue in a Thursday hearing that Maple Leaf should be added to the lawsuit due to its ownership of Canada Bread Co. Ltd. during the period of the alleged conspiracy.
The Competition Bureau fined Canada Bread $50m in 2023 after the company admitted to four counts of price-fixing. However, Canada Bread claims that Maple Leaf, which was its majority owner at the time, should be held accountable.
“Based on additional evidence produced to us as result of Canada Bread’s guilty plea, we allege that Michael McCain and Maple Leaf Foods were personally involved in this conspiracy to defraud Canadian consumers, and we believe they should be subject to the same scrutiny as the other defendants in this case,” stated Jay Strosberg, managing partner at Strosberg Wingfield Sasso LLP, in an emailed statement.
Michael McCain, the former CEO, and current executive chair of Maple Leaf, has previously denied any involvement. In August 2023, he said, “We continue to believe that the pricing practices of Canada Bread were responsible, consistent with industry practice, and above all, lawful.”
Court documents filed by Canada Bread accuse Maple Leaf of using it as a “shield” to evade responsibility for the alleged price-fixing.
Maple Leaf, which was the controlling shareholder of Canada Bread until Grupo Bimbo acquired it in 2014, is being accused of knowing or should have known about any anti-competitive behaviour, making it “vicariously and contractually liable.”
Maple Leaf, in response, denied these accusations. In its Wednesday statement, the company claimed that Canada Bread is attempting to set itself up to recover damages and said it will vigorously defend itself against what it called unfounded claims.
This class-action lawsuit is one of two initiated following an investigation by the Competition Bureau into an alleged industry-wide conspiracy to fix bread prices. The bureau’s investigation, which began in 2016, alleges that at least $1.50 was added to the price of a loaf of bread over 16 years.
Loblaw Cos Ltd. and Weston Foods, subsidiaries of George Weston Ltd. at the time, admitted to taking part in an “industry-wide price-fixing arrangement” and were granted immunity from prosecution in exchange for cooperating with the investigation.
However, other grocers and food companies have denied involvement. Metro Inc. recently argued in court that Loblaw and George Weston were trying to distribute blame across the industry. Loblaw, in response, denied Metro’s claims.
Recently, Loblaw and George Weston agreed to pay $500m to settle the two class-action lawsuits in Ontario and Quebec.
