NEW YORK -- Gristede's Foods here said it has entered into a memorandum with RMED International, a former shareholder, that would settle a class-action lawsuit filed by RMED in 1994 against Sloan's Supermarkets, Gristede's predecessor company, and John A. Catsimatidis, chairman and chief executive officer of both companies.
As a result, Gristede's said its directors' and officers' insurance carrier decided to settle the matter, with neither Gristede's nor Catsimatidis being required to pay any portion of the settlement amount. The carrier will also reimburse a portion of the defendant's legal fees, the company said.
The settlement is subject to formal approval by U.S. District Court in the Southern District of New York and is further subject to the execution of a definitive settlement agreement between the parties.
RMED International, Westport, Conn., which manufactures disposable diapers for private-label distributors, was a Sloan's stockholder from early 1993 until June 1994. In the suit, RMED claimed it was damaged by nondisclosures of certain filings made by Sloan's with the Securities and Exchange Commission between January 1993 and June 1994 relating to an investigation by the Federal Trade Commission of a Sloan's acquisition that was said to be anticompetitive.
Gristede's has consistently denied all allegations and said it made all required public disclosures.
In March 2002, a U.S. District Court judge ruled that a trial would be necessary to resolve outstanding issues of fact.