OMAHA, NE (AP)--A lawsuit has been filed against ConAgra Foods over fictitious sales and misreported earnings at a subsidiary.
ConAgra announced in May that accounting problems at United Agri Products Cos. would result in $120 million in lower earnings for 1998 through 2000.
United Agri Products, based in Greeley, CO, supplies fertilizer, seed and other farm products. It accounts for about 9% of ConAgra's business.
The lawsuit was filed Aug. 17 in federal court in Omaha on behalf of investors who held ConAgra stock between Aug. 28, 1998, and May 23, 2001. It asserts that ConAgra and several of the company's officers and directors violated federal securities laws by misrepresenting the company's financial performance to inflate its stock value.
ConAgra said the lawsuit is without merit.
"We will vigorously defend against the action," company spokeswoman Karen Lynn said. A lawsuit "is not unexpected whenever a company restates financials."
ConAgra and the Securities Exchange Commission are investigating the accounting problems at United Agri Products.
The lawsuit, since transferred to U.S. District Judge Richard Kopf in Lincoln, seeks class action status, asks for an Omaha jury trial and seeks damages, attorney's fees and other costs to be determined by the court.
With $27 billion in annual sales, ConAgra is the nation's largest food service manufacturer and second largest retail food supplier. Its major brand names include Healthy Choice, Hunt's tomato products, Banquet meals and Armour meats.