Ridout Barron


Loblaw providing gift cards after business law investigation

Restitution for business malpractice can be challenging, especially for large businesses whose practices affected a large number of customers. Loblaw Cos. Ltd. was found by a Competition Bureau investigation to be participating in a scheme to increase packaged bread prices for over 14 years. To make amends for these business law violations, they are offering customers who purchased the price-fixed bread in Alberta and throughout Canada $25 gift cards, a move that could cost the company as much as $150 million.

Loblaw's parent company, George Weston Ltd., admitted to participating in the price-fixing through its bread-maker Weston Bakeries. The details of what bread from Weston Bakeries as well as the other major bread producer involved will be made available in January when gift-card eligibility details are released. The bread price-fixing took place between late 2001 and March 2015.

The revelations came from a criminal probe that resulted from reporting by Loblaw itself.  The company claims that it reported the illegal activity as soon as it learned of its representatives working with other supermarket retailers and Canada Bead Co. Ltd to fix bread prices. As a result of their cooperation in the investigation on this activity, criminal charges will not be filed against Loblaw or George Weston for breaking Canadian business law. Several major grocers in Alberta and throughout Canada, such as Sobeys, claim they were not involved in price-fixing.

Civil class-action suits have been filed against companies involved in the price-fixing revelations. Loblaw and Goerge Weston have limited knowledge of the investigation and have been co-operating as "an immunity applicant." Alberta companies with business law questions or concerns should contact a lawyer.

Source: The Globe and Mail, "Loblaw admits to bread price-fixing scheme spanning more than 14 years", Marina Strauss, Dec. 19, 2017

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