Approval for Menu Foods settlement fund

02-06-2008 | |

Menu Foods Income Fund said on Friday that a US court gave preliminary approval to a settlement agreement covering lawsuits in US and Canadian courts.

Menu Foods was hit by more than 100 class action lawsuits last year after pet
foods it distributed were found to contain toxic ingredients imported from
China.

In March 2007, the company, whose products were sold under such
labels as Iams, Eukanuba, and President’s Choice, recalled tens of millions of
containers of wet dog and cat food.

Menu Foods said the settlement
agreement, which was announced in principle in April, would resolve class action
lawsuits filed in US and Canadian courts.

$24 million fund
The
deal calls for Menu Foods and its insurer to create a fund of $24 million to pay
for up to 100 percent of damages incurred by pet owners, subject to certain
limitations, the company said.

The fund will be operated by a neutral
claims administrator and will be available to US and Canadian consumers who
purchased or obtained recalled pet food, it said.

Paul Henderson, chief
executive of Menu Foods, said the company was pleased with the negotiated
settlement, which he said will enable it to focus on rebuilding its
business.

“If finally approved, the agreement will provide restitution to
the pet owners affected by the 2007 pet food recalls,” Henderson said in a
statement.

He reiterated the company’s previous statements that Menu
Foods, other pet food producers and pet owners were victims of “a terrible fraud
committed by a company in China.”

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