Minneapolis Food wholesaler and retailer Nash Finch said Wednesday that it signed a Stipulation of Settlement, which, if approved by the court, will resolve claims in a fraud class-action suit pending in the United States District Court for the District of Minnesota.
The suit was filed after the company issued revised earnings on Oct. 25, 2005. The suit challenged public statements that the company made about its acquisition of certain assets from Roundy’s Supermarkets. Nash Finch denies it engaged in any wrong-doing.
The settlement states that $6.75 million will be distributed to members of the class. This includes all people who purchased Nash Finch’s common stock between Feb. 24, 2005 (the date the company announced its agreement to acquire certain assets from Roundy’s) and Oct. 20, 2005.
The settlement payment will be funded by Nash Finch’s insurance coverage.
“We believed, and continue to believe, that this case lacks merit and had planned to defend the litigation vigorously,” said Alec Covington, president and CEO, Nash Finch.
“We have agreed to the settlement so that we can eliminate the distraction and expense of further litigation,” he said. “We believe that our shareholders are best served with this matter behind us, and our attention can now be focused on our business and the implementation of our strategic plan, Operation Fresh Start.”
Designed to sharpen the company’s focus and support growth initiatives, Operation Fresh Start will feature new retail formats, emphasis on supply chain services and key categories, as well as integrated services, including IT support, accounting, finance, human resources and legal.