BURLINGTON, Vt.--A class action settlement has been reached in an antitrust lawsuit brought by several Vermont dairy farmers against the nation’s largest fluid milk processor based in Dallas, Texas. The other defendants in the case, DFA and DMS, are not part of the $30 million settlement Dean Foods revealed last Thursday, December 9 in a lengthy submission to the Securities and Exchange Commission (SEC).

Dean’s statement to the SEC said the company had agreed to pay $30 million to farmers as a way to settle the “purported class action antitrust lawsuit” and that the company would also agree with “other terms and conditions” for its “raw milk procurement activities at certain of its processing plants located in the Northeast.”

The terms and conditions of procurement that are part of Dean’s settlement were not publicly available at press time Wednesday, although sources indicated that the settlement would be filed with the court this week and would be subject to the approval of the U.S. Distict Court Judge.

The lawsuit brought in October 2009 by several Vermont dairy farmers alleges, among other things, that Dean Foods and three other defendants engaged in price-fixing and conspiracy to control the milk market in the Northeast. However, one of the original defendants, HP Hood, was previously dropped from the case.

The class action includes dairy farmers serving milk markets in Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont and Virginia and the District of Columbia.

The plaintiffs contend that farmers were forced to join DFA or its marketing arm DMS (Dairy Marketing Services) in order to have a market for their milk and to continue in the dairy business. The suit specifically charges that the defendants sought to monopolize the market into which farmers had to sell their milk, fixed prices, and thus created an economic crisis in the region’s dairy industry.

Estimates are that Dean Foods has 90% of the fluid market share in New England and 40% of the fluid market share nationwide.

A similar Southeastern states class-action antitrust lawsuit is still pending in U.S. District Court in Tennessee. The U.S. Department of Justice is also investigating Dean’s acquisition of more fluid milk market share in the Midwest last year.

On the Dow-Jones Thursday, shares of Dean Foods Co. surged 7.5% after the company announced its plans to sell $400 million in notes to repay other borrowings and that it had reached this agreement to settle the Vermont-based antitrust lawsuit. Dean Foods’ stock remains 57% lower this year as the company reported lower quarterly earnings due to lower-priced private label milk attracting consumers away from Dean’s branded milk products. Even though competing in-store private label milk is also packaged by Dean Foods, the profits are less than for the company’s branded products.