Plaintiffs allege that defendants illegally conspired to inflate prices charged for their food products through a network of Value Added Service Providers, or VASPs. These companies bought food and sold it to US Foodservice Inc., who in turn sold it to their end customers under a “cost-plus” billing arrangement. A cost plus billing arrangement is where end customers agree to pay the suppliers cost, plus a fixed additional percentage. Plaintiffs state that the VASPs were actually wholly controlled by US Foodservice Inc., for the sole purpose of falsely inflating costs for selected food items. These inflated costs were invoiced to US Foodservice Inc., who in turn charged them to end customers in addition to any additional previously agreed upon additional percentage.
Any person or entity that purchased products from United Food Service under a “cost plus”
(a cost component plus and agreed upon markup) and for which United Food Service used a Value Added Service Provider (VASP) to calculate the cost component any time from
1998-2005. The alleged VASP’s that are a part of this settlement are:
- Seafood Marketing Specialists Inc.
- Frozen Farms Inc.
- Produce Solutions Inc. aka Cross Valley Produce Inc.
- Private Labels Distribution Inc., aka Private Brands Distribution Inc.
- Specialty Supply & Marketing Inc.
- Commodity Management Systems Inc.
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