ADEL, Iowa (Legal Newsline) - Parents and IEC-member schools have reached a settlement in a class action lawsuit claiming the defendants conspired to restrain competition in the market for the retail sale of food at schools in Iowa and that Martin Brothers attempted to monopolize the market in violation of Iowa antitrust laws.

Parents who purhcased lunch at IEC-member schools between Jan. 1, 2000, and Aug. 1, may be eligible to receive $3.50 per student, per year, up to a maximum of $50 per student, according to the settlement documents filed Aug. 1 in the Iowa District Court of Dallas County.

IEC-member schools are those served by the Iowa Educators Corporation, and its successor, The Iowa Association for Educational Purchasing and Martin Brothers Distributing Company Inc.

The settlement is the result of a lawsuit filed on Jan. 27, 2011, by Duane Smith, of Adel, and Brooke Smith, of Bouton, on behalf of themselves and all others similarly situated.

"The IEC and the IAEP and their counsel believe that the claims asserted in the action are without merit and that the evidence developed does not support any of those claims," the settlement document states. "The IEC and the IAEP have concluded, however, that continuation of the action would be protracted and expensive, and that it is desirable that the action be fully and finally settled in the manner and upon the terms set forth in this agreement."

The plaintiffs claimed the IEC, IAEP and Martin Brothers Distributing Company Inc., conspired to restrain competition in the market for the retail sale of food at schools in Iowa and that Martin Brothers attempted to monopolize the market in violation of Iowa antitrust laws.

Martin Brothers agreed to pay $1.925 million to pay the claims of class members and to cover other fees. The IEC and IAEP, through their insurer, will also make payments totaling $150,000 to cover certain costs, according to court documents.

Class counsel agreed to make an application for the award of attorneys' fees and expenses not to exceed $130,000, according to the settlement agreement.

The plaintiffs are represented by Steve W. Berman and Elizabeth A. Fegan of Hagens Berman Sobol & Shapiro LLP.

The defendants are being represented by Deborah M. Tharnish and Sarah E. Crane of Davis, Brown, Koehn, Shors & Roberts PC; Richard A. Duncan, Emily E. Chow and Kimberly J. Walker of Faegre Baker Daniels LLP.

Claims must be submitted by Sept. 30. A fairness hearing is scheduled for Nov. 4 for final approval of the settlement.

Iowa District Court of Dallas County case number: CVCV036641

From Legal Newsline: Kyla Asbury can be reached at classactions@legalnewsline.com.

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