Case Profiles: The Kraft Heinz Company Securities Litigation and Fair Fund

Merger between food companies mismanaged, plaintiffs allege, and leads to two concurrent settlements

Case Name 1: The Kraft Heinz Company

Settlement Fund: $450,000,000

Claim Filing Deadline: 10/10/2023

Class Period: 11/6/2015 - 8/7/2019

Case Name 2: The Kraft Heinz Company

Settlement Fund:  $62,314,211.31

Claim Filing Deadline: August 31, 2023

Class Period: 2/26/2016 -- 02/21/2019

In July 2015, Brazilian private equity giant 3G Capital concocted a merger between Kraft Foods Group and H.J. Heinz-- with an assist from Warren Buffet's Berkshire Hathaway. It was a strange alliance, according to Ken LaCroix of the blog D&O Diary. "3G Capital is a private equity firm known for its aggressive cost-cutting strategies," he wrote, "which often involve significant layoffs and restructuring. This approach is very different from Buffett’s 'value investing' philosophy, which focuses on identifying undervalued companies with strong fundamentals and holding them for the long term."

On February 21, 2019, nearly four years after the merger, Kraft Heinz made a grim announcement: the company had to make a $15.4 billion goodwill impairment charge. Upon this news shares of KHC fell 27%, from $48.18 per share on February 21 to $34.95 per share on February 22.

According to the plaintiffs, Kraft Heinz spent its first years as a new company reporting significantly increased profits thanks to its cost cutting and various synergies, while "in fact 3G Capital was imposing arbitrary and across-the-board cuts to costs. These cuts gutted the Company’s ongoing investments in R&D, quality control, and its global supply chain. These undisclosed and misrepresented cost cuts led to a significant degradation in the brand value of Kraft Heinz’s historic food brands and destroyed key customer relationships, which drove the massive $15.4 billion goodwill impairment."

Buffet eventually had to admit on CNBC's Squawk Box, "I was wrong in a couple of ways about Kraft Heinz," and perhaps one of those ways was pairing with a hedge fund with quite different strategies than his.

Kraft Heinz's problems eventually led to not only this securities class action but a related SEC Fair Fund. That fund, for precisely $62,314,211.31, has a deadline of August 31, 2023 (recently extended from June 21). Its class period is February 26, 2016 to February 21, 2019.

Kraft Heinz investors thus have over half a billion in recovery available to them in similar cases with similar class periods. If you would like to know more about what these cases or any of the hundreds of litigations in which we are filing claims for investors, then please give us a call at 312-204-6970.


"Kraft Heinz Securities Litigation Settles for $450 Million"

The Oracle of Omaha kickin' KHC on CNBC:

Plaintiff attorneys Bernstein Litowitz Berger & Grossmann on the litigation and settlement:

More News from the Class Action World

Case Name: Alphabet

Read More

Read More

Read More

Case Name: Read More

Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, MDL 1720


Read More

Read More

Case Name: ... Read More

Read More

Case Name 1: The Kraft Heinz Company

Read More