Abbott settled a government infant formula lawsuit for nearly $385 million.

On Sept. 14, 2026, Abbott Laboratories agreed to pay nearly $385 million to settle a whistleblower lawsuit regarding powdered infant formula that the the federal supplemental nutrition program for women, infants and children, known as WIC, and state Medicaid programs allegedly paid for.

The government claims the company told those programs that formula from its Sturgis, Michigan, plant met federal and state requirements when it did not.

How the whistleblower case began

In February 2022, Abbott recalled certain powdered formulas from the Sturgis plant. Eight months later, Scott Millard, Kristine Cooper and Loren Cooper, who all worked for the company, filed a lawsuit suit in the U.S. District Court for the Western District of Michigan.

The False Claims Act lets private citizens sue on the government's behalf and collect a share of any recovery. The United States, California, Maryland and Tennessee partially joined the case in August 2025, and Massachusetts, New York and Connecticut followed that November.

What the government alleges happened at the Sturgis plant

Federal attorneys allege Abbott knowingly made formula in conditions that exposed the products to an unacceptable risk of contamination. Frequent roof leaks allegedly allowed water to drip over equipment, and the company turned to temporary fixes, such as roof leak umbrellas, instead of addressing the root causes, according to the lawsuit. Company leadership understood that the wet conditions raised the risk of contamination, the complaint claims.

Additionally, Abbott operated spray dryers that turn liquid formula into powder even after the company documented cracks and pits inside them, according to the proposed class action. The company worsened the dryers' condition by running more product batches through them between cleaning cycles so it could increase production, the U.S. Department of Justice contends.

The lawsuit also claims Abbott skipped tests for bacterial growth on purpose to avoid positive results. In some cases where testing showed microorganism contamination, the company failed to disclose those results when the Food and Drug Administration requested them during 2019 and 2022 inspections, the complaint alleges.

The Abbott infant formula settlement breakdown

The settlememnt resolves claims tied to the Sturgis plant and a second plant in Casa Grande, Arizona, from January 2018 through December 2022. Abbott will pay $384,999,040.12 plus interest, split three ways:


  • The United States: $348,700,868, including $174,350,434 in restitution

  • Medicaid participating states: $35,491,288.40, including $17,745,644.20 in restitution

  • Massachusetts: $806,883.72 for supplemental WIC claims

Out of the federal share, the government will pay the three whistleblowers $69 million. The company denies the allegations, and the agreement states that the deal is no admission of facts or liability.

What the settlement means for WIC families

WIC pays for more than half of all infant formula bought in the country, the Department of Justice says. Because WIC and Medicaid paid for the formula, Abbott pays the settlement to the federal government and the states rather than to families.

The company agreed not to seek payment from WIC or Medicaid participants or their parents for any of the billings the deal covers. The government kept its right to pursue criminal and tax liability along with liability for personal injury tied to the covered conduct.

There is no claims process and no money available to individual consumers through this settlement.