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Dairy Agrees to $2 Million Settlement in Bid-Rigging Scam

September 10, 1992

RALEIGH, N.C. (AP) _ Flav-O-Rich Inc. has agreed to pay North Carolina $1.25 million in cash and give the state $750,000 worth of milk under a settlement of bid-rigging claims by the state.

The civil settlement was reached Wednesday following an investigation that began in 1989 after several dairy executives in Florida were indicted on bid- rigging charges, said Bill Tucker, a special investigator for the state attorney general’s office.

The state contended that the Kentucky-based corporation participated in a conspiracy to rig bids for contracts to supply dairy products to public schools in North Carolina from 1982 through 1988 in violation of state and federal antitrust laws.

Tucker said the state believes the dairy companies overcharged North Carolina school systems more than $8 million.

Flav-O-Rich did not admit any guilt in the settlement, which doesn’t provide for immunity from criminal prosecution to present or former employees or managers, Tucker said.