Loblaw Cos Ltd. and its parent company George Weston Ltd. stated that they have agreed to pay $500 million to settle a class-action lawsuit related to their alleged involvement in a price-fixing scheme for bread.

The class action was filed against a group of companies that includes Loblaw, Weston, Metro, Walmart Canada, Giant Tiger, and its owner Empire Co. Ltd.

The lawsuit alleges that the defendants conspired to fix the price of packaged bread in Canada and was brought on behalf of all residents of Canada who purchased packaged bread after November 1, 2001, excluding residents of Quebec and parties related to the defendants.

In a press release, George Weston said it will pay $247.5 million in cash, while Loblaw will pay $252.5 million, consisting of $156.5 million in cash and a $96 million credit that was previously paid to customers by Loblaw under the Loblaw Card program.

Galen Weston, President of Loblaw, who is also the Chairman and CEO of George Weston, stated, "This behavior should never have happened."

He said in a statement, "On behalf of the Weston Group of Companies, we regret the price-fixing behavior that we discovered and self-reported in 2015."

"We have the honor of serving Canadians from coast to coast. We must earn this privilege every day. Reaching a settlement on this matter was the right thing to do in response to past behavior that does not meet our values and ethical standards."

Loblaw's President and CEO Per Bank added that they are seeking to "earn the trust of Canadians whenever and wherever they choose to shop with us."

He said in the press release, "We will continue to work hard to meet this commitment."

Lawyers representing the plaintiffs stated that the payout, which is subject to court approval, is the largest antitrust settlement in Canadian history.

Jay Strosberg, Managing Partner of Strosberg Wingfield Sasso LLP, said in a separate press release, "This is a significant milestone in the history of Canadian class actions and sends a strong message that behavior harming consumers will not be tolerated."

The lawyers said their focus will now shift to preparing for trial in ongoing class actions against Canada Bread, Sobeys, Metro, Walmart Canada, and Giant Tiger.

The plaintiffs accused the companies of participating in a price-fixing conspiracy at the industry level over a 14-year period between 2001 and 2015, resulting in an artificial increase in packaged bread prices.

The Competition Bureau began investigating the alleged price-fixing of bread in January 2016. Weston Foods and Loblaw, both of which were subsidiaries of George Weston at the time, previously admitted to participating in "industry-wide price-fixing arrangements" and received immunity from prosecution in the price-fixing and cooperation exchange case.

At least $1.50 was added to the price of a loaf of bread during the 16-year conspiracy, according to the Bureau's claims in court documents in 2018.

In June 2023, Canada Bread was fined $50 million after pleading guilty to four charges related to price-fixing for bread products under the Competition Act. The Competition Bureau described it as the highest price-fixing penalty ever imposed by a Canadian court.

In its defense statement filed in the class action last October, Canada Bread denied its involvement in a widespread conspiracy to fix bread prices and denied benefiting from the alleged conspiracy or the price increases it acknowledged.

Metro filed a defense statement and counterclaim in the Ontario Superior Court late last year, accusing Loblaw and George Weston of conspiring to involve the competing grocer.

Metro denied its involvement in price-fixing of bread and accused the companies of trying to shift blame to the industry and avoid the public perception that Loblaw was the only retailer involved in price-fixing.

Sobeys also denied involvement in the class action and stated it is wrongly implicated.

Walmart Canada denied conspiring to fix the price of bread or violating the Competition Act, while Giant Tiger stated that it did not participate in or was aware of the alleged conspiracy.