Bought Store-Brand Baby Formula? You Could Qualify for Perrigo's $10 Million Price-Fixing Settlement

Many US families who bought store-brand infant formula since April 2020 could benefit from a proposed $10 million settlement with manufacturer Perrigo.

The agreement would resolve consumer allegations that Perrigo conspired with Gerber Products to restrict competition in the store-brand infant formula market, allowing Perrigo to raise prices that retailers passed on to shoppers. Perrigo has denied wrongdoing, and the allegations have not been established as findings of unlawful conduct.

The proposed settlement was filed in federal court in Brooklyn, New York, on 13th October, but individual payouts, claim deadlines, and the process for receiving compensation have not yet been confirmed. A federal judge must also approve the agreement before payments can proceed.

Under the deal, Perrigo will also refrain for three years from entering into agreements with infant formula businesses that limit competition in store-brand formula without a legitimate business reason. Perrigo has also agreed to cooperate with the plaintiffs' continuing case against Gerber, including by providing transaction data and making directors, officers, and employees available to testify.

Who Could Qualify for the $10 Million Settlement?

The proposed settlement covers consumers who purchased store-brand infant formula manufactured or sold by Perrigo from April 2020 onwards, according to the agreement reported by Reuters. The plaintiffs' lawyers estimate that millions of people across the US could fall within the proposed class.

Store-brand formula is sold under a retailer's own label rather than a manufacturer's brand name. These products can cost less than comparable branded alternatives, making them an important option for families trying to manage the recurring cost of feeding an infant.

However, the settlement does not mean every shopper will automatically receive money. The final eligibility rules, claims process, and distribution method will depend on the court-approved agreement and subsequent instructions from the settlement administrator.

What Went Wrong With Store-Brand Formula Prices?

The lawsuit alleges that Perrigo and Gerber reached an arrangement that restricted competition in the store-brand infant formula market, potentially leaving families paying more than they otherwise would have.

According to the allegations, Gerber agreed to give Perrigo the first right of refusal over its excess infant formula supply. That arrangement allegedly made it harder for rival manufacturers to obtain supplies and enter the store-brand market, limiting the competitive pressure that could otherwise have helped retailers secure lower prices.

Perrigo is a major US supplier of store-brand infant formula, which is sold through retailers under their own labels. The plaintiffs contend that restricting competing suppliers allowed Perrigo to inflate prices, with retailers passing those higher costs on to consumers.

The allegations also relate to Perrigo's acquisition of Gerber's Gateway infant formula manufacturing facility, which plaintiffs in related litigation have challenged as anticompetitive. These are allegations in litigation, not findings that the companies violated antitrust law.

Perrigo's agreement would resolve the consumer claims against the company, but the case against Gerber is continuing.

For families who regularly purchased store-brand infant formula, the proposed agreement could eventually provide a route to compensation for alleged overcharges. However, the immediate development is the proposed settlement itself, and not an open claims programme or confirmed payment schedule.