Winn-Dixie sanctioned in Keurig US antitrust case

By Mike Scarcella

(Reuters) – A U.S. magistrate judge said food retailer Winn-Dixie Stores Inc should be punished for failing to follow court orders in its U.S. lawsuit accusing coffee maker Keurig Green Mountain Inc of abusing its power in the single-serve brewer market.

U.S. Magistrate Judge Sarah Cave in Manhattan said in a 34-page order on Monday that Keurig was entitled to recover legal fees from Winn-Dixie as a sanction for “repeatedly and consciously” violating pretrial court orders last year concerning disclosure of emails, transactional data and other information.

Winn-Dixie’s claims against Keurig, now part of Keurig Dr Pepper (NASDAQ:) Inc, are part of a sprawling multidistrict litigation in Manhattan federal court that has been ongoing for nearly a decade.

Florida-based Winn-Dixie, a subsidiary of Southeastern Grocers Inc, in 2021 accused Keurig of artificially inflating prices on its “K-Cup Brewer” in violation of U.S. antitrust law. Other claims against Keurig are pending. Keurig has disputed any liability.

U.S. courts are often called on to referee pretrial disputes involving evidence and other matters. Penalties can include dismissal of claims or a lesser sanction requiring a party to pay an adversary’s legal fees.

Cave’s ruling can be appealed to a U.S. district judge for consideration. Winn-Dixie had opposed Keurig’s bid for sanctions. Cave in a separate order last year hit Keurig with a sanction over missing evidence in related litigation involving different plaintiffs.

Representatives from Winn-Dixie and Keurig did not immediately respond to requests for comment on Tuesday. Lawyers for the two companies also did not immediately respond to similar messages.

Keurig’s lawyers at Cleary Gottlieb Steen & Hamilton in November argued to Cave that Winn-Dixie “violated its fundamental duty to cooperate and participate transparently in discovery.” Keurig wanted Cave to dismiss Winn-Dixie’s lawsuit.

Lawyers for Winn-Dixie told Cave that Keurig had not been deprived of any evidence and that dismissal of claims was too extreme.

In her ruling, Cave said she “reasonably expects” that a monetary sanction will be enough to deter any future alleged misconduct.

The case is In Re: Keurig Green Mountain Single-Serve Coffee Antitrust Litigation, U.S. District Court, Southern District of New York, No. 1:14-md-02542-VSB-SLC.