Parents profit from food settlement suit

Parents of children enrolled in the Grinnell-Newburg Community School District may be entitled to a settlement as part of the class action case, Smith v. Martin Brothers Distributing Company, Iowa Educators Consortium (IEC) and the Iowa Association for Educational Purchasing (IAEP).

The settlement amount is three dollars and fifty cents per child per year enrolled in an affected school district with a 50 dollar cap per student. Court documents do not detail how these figures were reached.

The plaintiffs in this case alleged that since 2000, the IEC, a nonprofit organization that offers competitive pricing for educational services to Iowa schools, conspired with the Martin Brothers Distributing Company to monopolize the food market in several school districts throughout Iowa, which violates Iowa’s antitrust laws.

As a result of the Martin Brothers’ close relationship with the IAEP, an organization which allegedly hindered competition in the sale of food to schools, parents have paid higher prices for food than they would have otherwise.

Now, parents who have paid for food in any of the affected school districts may file a claim until Tuesday, Sept. 30, which will determine whether they are eligible to receive a portion of the 1,925,000 dollar settlement paid by the Martin Brothers.

The Grinnell-Newburg School District was not directly involved in the suit, besides being one of the districts applicable to the settlement.

“The school district itself doesn’t get any money from the settlement, just the parents with children in the district. [The Grinnell-Newburg School District] should not be affected,” said Carrie Nachazel, Food Service Director of the Grinnell-Newburg schools.

“The reason Grinnell-Newburg is involved is because we participate in the IAEP along with a lot of other districts in the state,” Nachazel said.

Grinnell residents might be eligible for compensation if they had children enrolled at Grinnell Middle School or Grinnell High School between January 1, 2000 and August 1, 2014.

Nachazel was uncertain why the class action case was brought about now but said that she believes the IAEP had been working with the Martin Brothers as their food distributor for the past 14 years, hence the years of eligibility for compensation.

Parents who do not submit a claim form by the Tuesday, Sept. 30 deadline will not be eligible to receive any compensation as part of the settlement. These terms could potentially work in favor of the Martin Brothers, as parents might not complete a claim form, especially since the settlement amount is relatively small.

“The Martin Brothers have denied any wrongdoing and settled to avoid litigation costs,” Nachazel added.

According to the settlement website, there will be a fairness hearing at the Dallas County Court in Adel, Iowa, on Tuesday, Nov. 4 to determine whether the terms of the settlement with the IAEP and the Martin Brothers are “fair, adequate and reasonable.” Payments to parents are dependent on the court upholding the settlement terms at this hearing.

More information, as well as claim forms, can be found at www.iowaschoolfoodsettlement.com.