Canadian meat heavyweight Maple Leaf Foods (MLF) has filed a defamation lawsuit against Canada Bread and its parent company, the Mexican bakery giant Grupo Bimbo, related to an alleged bread price-fixing scheme.
The lawsuit, filed on 21 November (Thursday), in the Ontario Superior Court of Justice, is seeking C$200m ($141.9m) in damages for defamation, competition violations and conspiracy.
Maple Leaf Foods has also sought C$10m in punitive damages and demanded indemnification for any costs incurred.
The lawsuit stems from allegations made by Canada Bread against Maple Leaf.
Canada Bread had claimed Maple Leaf used it as a "shield" to evade responsibility in the alleged packaged bread price-fixing scheme, which is the focus of two class-action lawsuits and an ongoing probe by the country's Competition Bureau.
In its latest lawsuit, Maple Leaf stated: “Throughout the period from at least late October 2017 to November 2024, Grupo Bimbo and Canada Bread have continued to conspire and collude in an effort to falsely and unfairly blame MLF for their self-inflicted wounds and business failures and to lay the groundwork for unfounded claims Canada Bread and Grupo Bimbo have indicated they intend to commence against MLF.”
In a response sent to Just Food, Grupo Bimbo said: "Canada Bread is aware of Maple Leaf Foods' latest actions. Maple Leaf Foods’ claim is completely without merit. We have no further comment regarding litigation between the parties."
Mississauga, Ontario-based Maple Leaf divested its 90% stake in Canada Bread in 2014 to Grupo Bimbo, the world's largest bakery business with operations across more than 30 countries.
The investigation into the bread price-fixing scandal dates back nearly a decade.
In 2015, the Competition Bureau of Canada initiated an investigation into allegations of price-fixing, involving Canada Bread, Weston Foods and supermarket chain Loblaw, both subsidiaries of George Weston.
Also implicated in the investigation were Maple Leaf Foods, as the former owner of Canada Bread, along with retail chains Metro, Sobeys, Wal-Mart Canada, and Giant Tiger Stores.
In December 2017, Weston Foods and Loblaw acknowledged their involvement in what they called an "industry-wide price-fixing arrangement." In return for their complete cooperation with the Bureau's investigation, they were granted immunity from prosecution.
In June 2023, Canada Bread pleaded guilty to four counts of price-fixing and was fined C$50m by the Ontario Superior Court.
Canada Bread filed a lawsuit in September this year against Maple Leaf Foods, seeking damages for the fine it incurred in the price-fixing case.
It alleged that “Maple Leaf failed to act in accordance with the law and breached its management agreements with Canada Bread. From 1995 to 2014, as the controlling shareholder, Maple Leaf appointed directors to serve on the Canada Bread board of directors and positioned some of the most senior officers of Maple Leaf to operate Canada Bread and occupy the most senior executive role.”
The following month, an Ontario court dismissed a motion filed by plaintiffs for Canada Bread to have Maple Leaf Foods included in the class-action lawsuit related to the price-fixing scandal.
The plaintiffs aimed to overturn a December 2021 ruling by the Ontario Superior Court, which had excluded Maple Leaf from the price fixing case.
