US Foodservice, the division of Royal Ahold that precipitated that company’s financial scandal when it falsified earnings reports in order to boost the its stock price and increase the bonuses paid to executives, is now being sued by a Connecticut health care facility for participating in an illegal kickback scheme.
Waterbury Hospital has filed a federal class action lawsuit against US Foodservice, charging that the company demanded kickbacks from suppliers that sold it merchandise, which enabled it to garner a higher price than what had been agreed upon by its sales people and the hospital’s representatives.
The lawsuit maintains that the kickback scheme accounted for 16 to 20 percent of US Foodservice’s total sales between 2000 and 2003.
The class action part of the suit apparently was filed on the belief that there will be other hospitals and US Foodservice customers that have victimized in the same way.
US Foodservice and Ahold management have not been commenting on the lawsuit.
Waterbury Hospital has filed a federal class action lawsuit against US Foodservice, charging that the company demanded kickbacks from suppliers that sold it merchandise, which enabled it to garner a higher price than what had been agreed upon by its sales people and the hospital’s representatives.
The lawsuit maintains that the kickback scheme accounted for 16 to 20 percent of US Foodservice’s total sales between 2000 and 2003.
The class action part of the suit apparently was filed on the belief that there will be other hospitals and US Foodservice customers that have victimized in the same way.
US Foodservice and Ahold management have not been commenting on the lawsuit.
- KC's View:
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Gee…sounds like this little lawsuit could possibly put a crimp into Ahold’s plans to sell US Foodservice, which was announced earlier this month as one of the conclusions of the company’s extensive strategic review.
It also is sort of interesting that Ahold didn’t mention this lawsuit in its conclusions…especially since it was filed more than a month ago (though it is only getting media attention now).
Time to check US Foodservice’s organizational chart to see if somebody named Soprano has been running the place. Because the more you hear about these guys, the more you have to wonder if they had any ethical compass at all…and the more you have to wonder what now-deposed CEO Cees van der Hoeven knew and when did he know it.
