Full Breakdown
Abbott Agrees to $385 Million Settlement Over Infant Formula Contamination Claims
By Drooid · · How we work
Core Event
Abbott Laboratories has agreed to pay $385 million to resolve federal and state claims that its powdered infant formula was produced in conditions that posed a substantial risk of microbial contamination. The settlement addresses allegations that Abbott submitted false claims to U.S. Department of Agriculture (USDA) and Medicaid programs for formula manufactured at its Sturgis, Michigan, and Casa Grande, Arizona facilities between January 1 2018 and December 31 2022. The agreement contains no finding of liability and does not require Abbott to admit wrongdoing.
Background & Context
In 2022, Abbott recalled several infant-formula brands, including Similac, after reports of illnesses linked to the bacterium *Cronobacter sakazakii* and *Salmonella Newport*. The recall intensified a national shortage that had already been strained by pandemic-related supply-chain disruptions and stockpiling. The U.S. Justice Department filed a lawsuit alleging that Abbott knowingly manufactured formula in environments that failed to meet federal safety standards, and that the company failed to properly test products or alert regulators to positive test results.
Timeline
- January 1 2018 – December 31 2022 – Period during which the alleged manufacturing failures occurred.
- 2022 – Abbott closed the Sturgis plant after the Food and Drug Administration began an investigation; the plant reopened later that year.
- November 13 2025 – The United States filed a Complaint in Intervention alleging false claims submitted to the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) and state Medicaid programs.
- September 14 2026 – Abbott announced the settlement of the claims.
Data & Statistics
- Total settlement: $384,999,040 (rounded to $385 million in public statements).
- Payment to the United States: $348,700,868 for False Claims Act allegations.
- Payment to participating states: $36,298,172 for Medicaid and WIC claims.
- The recall affected multiple formula lines and contributed to a shortage that left many families unable to obtain infant formula.
Official Statements & Responses
- The U.S.
- U.S. Attorney for the Western District of Michigan Timothy VerHey stressed that suppliers to government nutrition programs must meet or exceed all federal nutrition and safety requirements.
- Abbott stated that tests of unopened formula retrieved from homes during the 2022 recall were negative for *Cronobacter sakazakii*, and that no unopened, distributed Abbott formulas have ever tested positive for either *Cronobacter* or *Salmonella Newport*.
Conflicting Reports & Gaps
- Settlement amounts are reported as $385 million, “more than $384 million,” and the precise figure $384,999,040 across sources.
- While Abbott and the Justice Department cite negative test results for *Cronobacter*, the Chicago Tribune notes that the Centers for Disease Control and Prevention did not identify a definitive link between *Cronobacter* cases and the Sturgis facility.
- Some reports mention *Salmonella Newport* as part of the 2022 recall, whereas other sources focus solely on *Cronobacter*.
Verbatim Quotes
- “When someone supplies the government with food that is meant to be given to our infant children, we demand that it meet or exceed every federal nutrition and safety requirement,” — Michigan Timothy VerHey
- “Today’s settlement is a victory for American families and makes clear the safety of our children is not negotiable,” — Acting Deputy Attorney General
