DECATUR - Archer Daniels Midland Co. will pay $400 million to settle a federal antitrust lawsuit that claimed the company conspired to fix the price of high fructose corn syrup, a sweetener used in products ranging from soft drinks to pasta sauces.
"We are pleased to have reached a resolution with our customers in the food and beverage industries," G. Allen Andreas, chairman and CEO of Decatur, Ill.-based ADM, said in a statement late Thursday.
The settlement is subject to approval by U.S. District Court in Peoria.
The class-action lawsuit was filed in 1995 by about 20 corn syrup buyers, who alleged that ADM's actions cost them $1.6 billion. Plaintiffs included the Coca-Cola Co. and PepsiCo.
The case had been scheduled for a September jury trial and ADM could have faced damages of nearly $5 billion, as jurors could have tripled any award if they found the company guilty.
"In light of the potential exposure inherent in litigation, the board of directors concluded that it was in the best interests of the company to dispose of this matter," Andreas said in a statement.
The settlement could potentially extend to about 2,700 plaintiffs who bought the corn-based sweetener from 1991 to 1995.
The lawsuit grew out of a federal investigation into ADM's involvement in a price-fixing scandal involving the livestock feed supplement lysine and citric acid, used in food, detergents and other products.
ADM pleaded guilty to federal antitrust charges in that case and was fined $100 million, but received immunity from all other charges. The company was never convicted of fixing corn syrup prices.
Three former ADM executives received prison sentences in 1999 as a result of the price-fixing scandal.