Canadian meat industry leader Maple Leaf Foods (MLF) has initiated legal action against Canada Bread and its parent company, Grupo Bimbo, a major Mexican bakery corporation. The lawsuit, linked to allegations of a bread price-fixing scheme, was filed on November 21 in the Ontario Superior Court of Justice. Maple Leaf Foods is seeking C$200 million (approximately $141.9 million) in damages for defamation, competition breaches, and conspiracy.
Additionally, Maple Leaf Foods is pursuing C$10 million in punitive damages and is requesting reimbursement for any expenses incurred during this process. This lawsuit is a direct response to allegations made by Canada Bread, which accused Maple Leaf of using its position as a “shield” to avoid accountability in the purported packaged bread price-fixing scheme. This scheme has prompted two class-action lawsuits and an ongoing investigation by Canada’s Competition Bureau.
Maple Leaf’s lawsuit contends: “Throughout the period from at least late October 2017 to November 2024, Grupo Bimbo and Canada Bread have continued to conspire and collude in an effort to falsely and unfairly blame MLF for their self-inflicted wounds and business failures and to lay the groundwork for unfounded claims Canada Bread and Grupo Bimbo have indicated they intend to commence against MLF.”
In a statement to Just Food, Grupo Bimbo remarked, “Canada Bread is aware of Maple Leaf Foods’ latest actions. Maple Leaf Foods’ claim is completely without merit. We have no further comment regarding litigation between the parties.”
Notably, Maple Leaf Foods divested its 90% stake in Canada Bread in 2014, transferring ownership to Grupo Bimbo, the world’s largest bakery enterprise, which operates in over 30 countries. The roots of this bread price-fixing investigation extend back nearly a decade. In 2015, Canada’s Competition Bureau launched an inquiry into possible price-fixing involving Canada Bread, Weston Foods, and the grocery chain Loblaw, all subsidiaries of George Weston.
Maple Leaf Foods, as the former owner of Canada Bread, was also implicated in this investigation, alongside various retailers, including Metro and Sobeys, as well as Wal-Mart Canada. By December 2017, Weston Foods and Loblaw acknowledged participation in what they characterized as an “industry-wide price-fixing arrangement.” They received immunity from prosecution due to their full cooperation with the Bureau’s investigation.
In June 2023, Canada Bread pleaded guilty to four counts of price-fixing, resulting in a C$50 million fine from the Ontario Superior Court. Subsequently, Canada Bread filed a lawsuit in September against Maple Leaf Foods, seeking damages associated with the fine incurred in the price-fixing case. The lawsuit alleged that Maple Leaf failed to act in compliance with the law and breached its management agreements with Canada Bread during the period it was the controlling shareholder, from 1995 to 2014.
An Ontario court dismissed an attempt by plaintiffs to include Maple Leaf Foods in the class-action lawsuit concerning the price-fixing scandal. Plaintiffs sought to overturn a December 2021 ruling that had previously excluded Maple Leaf from this case.
As the legal proceedings unfold, it is vital for professionals in the food and beverage industry to monitor these developments. Understanding the implications of such legal cases on Canadian food and drink consumer trends could offer valuable insights for maintaining a competitive edge in the market.
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