De Brauw Blackstone Westbroek has assisted Ahold on signing a term sheet agreeing in principle to settle a class action pending in the United States District Court for the District of Connecticut, in respect of pricing practices of Ahold’s former subsidiary U.S. Foodservice in the period 1998-2005.
Ahold has agreed to make a payment of USD 297 million into a settlement fund, in return for a release from all claims from all participating class members in relation to these pricing practices.
Ahold indemnified U.S. Foodservice against damages arising out of this class action as part of the terms of Ahold’s sale of U.S. Foodservice in July 2007 to a consortium of Clayton, Dubilier & Rice and Kohlberg, Kravis Roberts & Co for a purchase price of USD 7.1 billion.
The class comprises any person in the United States who purchased products from U.S. Foodservice pursuant to an arrangement that defined a sale price in terms of a cost component plus a mark-up, and for which U.S. Foodservice used a so-called “Value Added Service Provider” transaction to calculate the cost component.
The settlement is subject to approval by the United States District Court for the District of Connecticut, which is anticipated to address the issue in late 2014 or early 2015. In addition, the settlement is subject to potential reduction and/or termination, based on the compensable sales volume attributable to class members that elect to opt out of the settlement. Upon becoming unconditional the settlement will definitively resolve this potential liability for Ahold.
De Brauw acted as lead counsel to Ahold in determining and executing case strategy, and acted as Ahold’s agent in instructing teams from law firms White&Case and Quinn Emmanuel.
Marnix Leijten (lead partner), Albert Marsman and Patrick Ploeger
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