BALTIMORE -- Tyson Foods Inc. has agreed to settle a lawsuit that accused the poultry giant of falsely claiming its chickens were "raised without antibiotics."
Under the proposed settlement, filed in U.S. District Court in Baltimore, Springdale, Ark.-based Tyson would pay up to $50 to anyone who bought poultry that was labeled antiobiotics-free.
The payout from Tyson would be capped at $5 million, not including $3 million in attorneys' fees. If Tyson doesn't give that much money back to consumers, it will make up the difference by donating products to food banks.
Attorneys for the plaintiffs and for Tyson have asked U.S. District Judge Richard D. Bennett to grant preliminary approval to the settlement. At that point, Tyson would begin a national print and Internet advertising campaign to let people know how they can claim refunds.
"We're pleased a settlement has been reached and will now wait for the court to review and, we hope, approve the agreement," Tyson spokesman Gary Mickelson said in a statement. "While we believe our company acted appropriately, we also believe it makes sense for us to resolve this legal matter and move on."
In 2007, Tyson began advertising and labeling its poultry products as having been "raised without antibiotics." The following year, USDA ordered Tyson to remove the labels when it found that the company had injected its chickens with antibiotics before they hatched. Tyson argued the labels were accurate because chickens aren't "raised" until after they're born.
Researchers believe the widespread use of antibiotics in livestock has fueled the emergence of drug-resistant bacteria known as superbugs, which killed more than 65,000 people in the U.S. last year.
Tyson had revealed previously that it includes ionophores in its chicken feed. Though widely considered an antibiotic, ionophores are not used to treat illnesses in humans and thus are not believed to raise human health concerns.
The class-action consumer lawsuit grew out of the USDA probe and a previous lawsuit filed by Tyson's competitors about its ad campaign. It claimed Tyson preyed on the growing market for organic and natural foods.
James J. Pizzirusso, an attorney for the plaintiffs, said the settlement "puts a lot of value in the hands of consumers" and could benefit the needy as well if Tyson ends up donating products to food banks.
The settlement establishes a three-tiered system for consumers who bought poultry with the "raised without antibiotics" label. Those who saved their receipts can claim a refund of up to $50. Those who did not save receipts can submit a sworn statement detailing the poultry they bought and receive up to $10.
Those who claim they bought Tyson poultry at least once between June 2007 and April 2009 can receive a $5 coupon.
"We wanted to make the total value high enough that people would go through that trouble," Pizzirusso said. "Ten dollars is not a fortune, but it's not nothing. If you bought this product and bought at least $10 worth, all you have to do is fill out a form to get $10."
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