Maple Leaf refutes bread price-fixing claims ahead of attempt to add it to lawsuit

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Maple Leaf Foods asserted its innocence in an alleged bread price-fixing scheme ahead of a hearing to determine whether it will be added to an ongoing class-action lawsuit.

In a statement Wednesday, Maple Leaf said any claims that it participated in the alleged conspiracy are false.

“As we’ve said before, Maple Leaf Foods has done nothing wrong here,” the company said on its website.

When the class-action lawsuit was originally certified in an Ontario court in 2021 against several grocery retailers and other food companies, Maple Leaf was not included.

However, the plaintiffs are set to argue in a hearing scheduled on Thursday that Maple Leaf should be added as a defendant in the lawsuit because of its ownership of Canada Bread at the time of the alleged conspiracy.

Canada Bread was fined $50 million by the Competition Bureau in 2023 after admitting to four counts of price-fixing, but has argued as part of the class-action lawsuit that Maple Leaf, which was its majority owner at the time, should shoulder the blame instead.

“Based on additional evidence produced to us as result of Canada Bread’s guilty plea, we allege that Michael McCain and Maple Leaf Foods were personally involved in this conspiracy to defraud Canadian consumers and we believe they should be subject to the same scrutiny as the other defendants in this case,” said Jay Strosberg, managing partner at Strosberg Wingfield Sasso LLP, in an emailed statement.

McCain, the previous CEO of Maple Leaf and now the company’s executive chairman, previously denied involvement in the alleged conspiracy.

“We continue to believe that the pricing practices of Canada Bread were responsible, consistent with industry practice, and above all, lawful,” he said in a statement on the company’s website in August 2023.

In recently filed court documents, Canada Bread accused Maple Leaf of using it as a “shield” to avoid liability in the alleged price-fixing scheme. Maple Leaf was Canada Bread’s controlling shareholder until it was purchased by Grupo Bimbo in 2014.

Canada Bread argued Maple Leaf knew or ought to have known of any anti-competitive conduct, making it “vicariously and contractually liable.”

Maple Leaf, which has denied the accusations, said in its Wednesday statement that Canada Bread is trying to set itself up to recover damages. It said it will vigorously defend itself against what it called unfounded claims.

The class-action lawsuit is one of two launched in the wake of an ongoing Competition Bureau investigation into an alleged industry-wide conspiracy to fix the price of bread.

The bureau began investigating the alleged scheme in 2016 and has alleged at least $1.50 was added to the price of a loaf of bread over a period of 16 years.

Loblaw and Weston Foods, both subsidiaries of George Weston at the time, had admitted to participating in an “industry-wide price-fixing arrangement” and received immunity from prosecution in exchange for co-operating.

However, other grocers and food companies have denied participating in such an arrangement, with Metro recently arguing in court documents that Loblaw and its parent company George Weston were trying to spread blame across the industry. Loblaw denied the claims by Metro.

Recently, Loblaw and George Weston announced they agreed to pay a combined $500 million to settle the two class-action lawsuits in Ontario and Quebec.

A timeline of events in the bread price-fixing scandal

Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.

Here’s a timeline of key events in the bread price-fixing case.

Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.

Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.

Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.

Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).

Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.

June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.

Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”

Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.

July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.

Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.