Delaware court revives Blue Bell Creameries shareholder suit

Delaware's Supreme Court has overturned a judge's dismissal of a shareholder lawsuit against one the country's largest ice cream manufacturers involving a 2015 listeria outbreak that killed three people and caused the company significant financial losses

ByRANDALL CHASE AP Business Writer
June 19, 2019, 9:37 AM
FILE - In this April 10, 2015, file photo, Blue Bell ice cream rests on a grocery store shelf in Lawrence, Kan. Delaware's Supreme Court on Tuesday, June 18, 2019, overturned a judge's dismissal of a shareholder lawsuit against one the country's larg
FILE - In this April 10, 2015, file photo, Blue Bell ice cream rests on a grocery store shelf in Lawrence, Kan. Delaware's Supreme Court on Tuesday, June 18, 2019, overturned a judge's dismissal of a shareholder lawsuit against one the country's largest ice cream manufacturers involving a 2015 listeria outbreak that left three people dead and caused the company significant financial losses. (AP Photo/Orlin Wagner, File)
The Associated Press

DOVER, Del. -- Delaware's Supreme Court has overturned the dismissal of a shareholder lawsuit against one the country's largest ice cream makers after a 2015 listeria outbreak that killed three people.

The court ruled Tuesday that a judge erred because the plaintiff had not demanded that the board of Blue Bell Creameries take action itself before the lawsuit was filed. That demand requirement can be waived if a plaintiff raises reasonable doubts about the impartiality of directors because of close ties to management. Former CEO Paul Kruse is a defendant in the suit.

The court also said the lawsuit adequately alleges that the board at Blue Bell failed to implement any system to monitor food safety performance or compliance.

The Brenham, Texas, company suffered significant financial losses due to the outbreak.

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