This week, that mediation is set for Thursday. If that doesn’t work, a one-month trial is set to start on November 15.
David Burstyner, a lawyer for the farmers, was asked for his opinion.
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His firm, Adley Burstyner, said on its website that the action was meant to get money for dairy farmers who supplied Fonterra in May and June 2016.
The class action is trying to get a judge to say that Fonterra’s step-down was illegal, including that it was misleading, deceptive, and unfair.
On June 17, 2020, the case was brought to the Supreme Court of Victoria.
The company said that court hearings have happened in 2020, as well as last year and this year.
“Orders were made for Fonterra to find documents on April 21, 2021. The date for mediation with Fonterra is October 13, and the trial is set to start on November 15,” the website said.
Fonterra has filed detailed witness statements from Matthew Watt, Judith Swales, Michael Cronin, and Mark Conway. The court ordered Fonterra to turn over 55,000 documents, such as New Zealand board minutes and internal communications about prices.
“The plaintiffs have turned in their witness statements and five expert reports from a world-class milk price expert, a forensic accountant, an expert industry consultant, an industry expert and leader, and a psychologist.”
Late in June of this year, The Standard said that farmers were worried that Fonterra was coming up with a new defence to weaken compensation claims from Australian suppliers who lost money because of the milk processor’s 2016 price clawback.
At a hearing on June 15, Fonterra asked for permission to change its defence to include a 40-cent payment made to farmers in 2017-18. It said that the payment should be counted as part of the controversial 2016 farmgate price clawback.
The class action claims that Fonterra broke its contract with a retroactive step down in May 2016 when it cut the expected milk payments.
Farmers had to pay back a big chunk of their income. In the same year, the NZ giant made $834 million in profit.
The clawback caused a serious cash flow problem and led to a class action lawsuit, which is backed by 300 farmers who say Fonterra misled and tricked them, acted unfairly, and broke contracts with dairy farmers.
Former suppliers said that the defence was “absolute rubbish” and that it was an attempt to lower the financial compensation claim for lost income in the past, which Mr. Burstyner said was expected to be “hundreds of millions of dollars.”
He said that the 40c payment wasn’t given to all farmers who lost money because of the step down because Fonterra wouldn’t give it to farmers who switched to other processors.
Mr. Burstyner said, “It seemed like a very spiteful thing to do.”
At the time, Matthew Watt, who was in charge of Fonterra Australia’s farm source, said, “This payment is for the 17-18 season, not the 15-16 season.”
Mr. Watt wrote on the dairy insider blog, “Even though the law doesn’t require it, we’re giving our suppliers an extra 40 cents because it’s the right thing to do.”
All Fonterra farmers who lost money because of the price drop in 2015–16 will be able to get this extra payment, whether they are still farming or are retired or coming back,” he wrote.
“We’re trying to get in touch with all the farmers who left us.”
The payment came at the same time as Murray Goulburn’s decision to forgive almost $150 million in debts owed by farmers. This was done after the Australian Competition and Consumer Commission sued the cooperative over the milk price mess in 2015-16.
A year ago, the managing director of Fonterra, René Dedoncker, said that the future of dairy in the south-west was safe and that the Cobden factory would be there “for the long run.”
About three years ago, Fonterra closed its plant in Dennington, which put 100 people out of work.
Fonterra said last month that it would no longer sell its Australian operations.
Fonterra was contacted for comment.
