The Yukon School District has received a check for $500,000 to settle a federal lawsuit against its former food distributor.
The settlement with Sysco Foods Oklahoma was signed Jan. 10. It releases all claims the school district had against the company, which school officials had claimed overcharged for its services.
The settlement originally was confidential. However, both sides have agreed to waive the confidentiality.
Under the agreement, the board of education for the Yukon School District received $272,611.09 while attorneys Michael Blaschke and Randall Sullivan received the remainder of the funds.
The lawsuit, which was filed in 2016, claimed Sysco overcharged the district by more than $750,000 between 2008 and 2012.
The lawsuit claimed allegations of actual and constructive fraud, fraud in the inducement, breach of fiduciary duty and breach of contract.
In the lawsuit, the school district said Sysco was awarded a contract to provide food services based on a bid price. However, they actually charged significantly more.
The school district stated that Sysco began overcharging on the first item purchased in the school year by 28.5 percent.
The settlement states that despite the settlement, Sysco denies any wrongdoing.
The lawsuit was prompted after a company called Cost Defender notified the district of the overpayment.
Superintendent Dr. Jason Simeroth said the company offered to audit the school’s books. While it is not unusual for companies to offer to provide services, such as audits, to boost their business, Cost Defender’s representative sent an open records request.
“They came in and said they wanted to check numbers. … He did all of the investigative digging himself to prove his data. He was very determined,” Simeroth said.
As a result, the company will receive a percentage of the settlement.
The remainder will go to the attorneys.
Simeroth said he is glad to have the lawsuit settled.
“I feel like as best we could, a wrong has been righted and the district has been vindicated,” the superintendent said.
The funds will be returned to the school district’s general fund.
The district’s current food service provider, Southwest Foods, uses a different food supplier. This year, however, is the final year of a five-year contract. Simeroth said a new request for bids is expected later this spring.