Abbott Laboratories has agreed to pay $384,999,040 to resolve federal allegations that it caused false claims to be submitted to government programs for powdered infant formula and nutritional products made at its plants in Sturgis, Michigan, and Casa Grande, Arizona, the Justice Department announced on Monday. The claims cover the period from Jan. 1, 2018, through Dec. 31, 2022.
The case matters to families because of who paid for the formula. According to the Justice Department, more than half of all infant formula bought in the United States is paid for with U.S. Department of Agriculture funds through the Special Supplemental Nutrition Program for Women, Infants, and Children, known as WIC. State Medicaid programs also cover certain infant formula.
Abbott did not admit wrongdoing. The Justice Department said the claims resolved by the settlement are allegations only and that there has been no determination of liability. In a statement reported by UPI, the company said "nothing matters more than the safety and quality of Abbott's products."
What the Government Alleged About the Sturgis Plant
The United States filed its complaint in the case on Nov. 13, 2025. According to the Justice Department, the complaint describes roof leaks as a common occurrence at the Sturgis plant, with water running and dripping over equipment. Instead of fixing the root causes, the government alleged, Abbott used temporary measures such as roof leak umbrellas to divert water in product processing areas, even though company leaders understood the wet conditions raised the risk of contamination.
The complaint also alleged that Abbott kept running spray dryers, the machines that turn liquid formula into powder, after documenting cracks and pits in them. It further alleged that the company increased the number of product batches run through the dryers between cleanings to boost production. The government also alleged that Abbott intentionally avoided testing for bacterial growth to avoid positive results and, in some cases, did not disclose contamination test results when the FDA requested them during 2019 and 2022 inspections.
"No company should be gambling on the health and safety of our Nation's infants," Associate Attorney General Stanley E. Woodward Jr. said in the department's announcement.
These are the government's allegations, not findings by a court.
The 2022 Recall and Formula Shortage
The Sturgis plant was the largest infant formula plant in the country. It came under federal investigation after four infants in Minnesota, Ohio, and Texas developed Cronobacter sakazakii infections after consuming formula made there. Cronobacter is a rare bacterium that can survive in dry foods and can cause dangerous blood infections or meningitis in infants. The CDC said the infections may have contributed to the deaths of two infants in Ohio.
In February 2022, Abbott recalled certain lots of Similac, Alimentum, and EleCare powdered formula, and the plant shut down. The closure worsened a formula supply shortage already strained by the COVID-19 pandemic. Food Safety News reported that the recall led to a severe nationwide shortage, including shortages of formula contracted by federal and state governments.
Some facts about the outbreak remain disputed. Abbott has said no unopened, distributed Abbott infant formula tested positive for Cronobacter sakazakii. The FDA said five environmental samples collected at the plant tested positive. According to the CDC's outbreak investigation summary, genetic testing of the two available patient samples did not find them to be closely related to the strains found at the plant or to each other.
Where the Money Goes
Under the agreement, Abbott will pay $348,700,868 to the United States and $36,298,172 to certain states for claims settled by their Medicaid and WIC programs. Three former Abbott employees, Scott Millard, Kristine Cooper, and Loren Cooper, filed the original whistleblower lawsuit under the False Claims Act and will receive $69 million as their share of the federal settlement.
None of that money goes to individual families. Numerous lawsuits filed by parents remain pending.
Seattle food safety attorney Bill Marler, who writes a publisher's column for Food Safety News, told the outlet that Congress could go further than the settlement and noted that it has had an infant formula bill since March. He said that "every dollar of it is backward-looking," in comments published by Food Safety News.
The Justice Department's announcement does not describe any new testing requirements for formula plants.
Practical Guidance for Parents Buying Formula Now
No active recall is tied to this settlement, and the announcement does not ask anyone to stop using a product. Parents do not need to throw away formula because of this news.
The CDC advises parents to make sure formula is not expired or recalled and that the container has no dents, puffy ends, or rust spots. Recalls are often issued by lot code, so it helps to check the code on the bottom of the container before buying in bulk.
For babies at higher risk of Cronobacter infection, the CDC suggests considering liquid, ready-to-feed formula when possible, because it is made to be sterile and powdered formula is not. The agency's guidance on preventing Cronobacterin infants also describes extra steps for preparing powdered formula for these babies, including mixing it with boiled water that has cooled for no longer than five minutes. Parents can ask a pediatrician whether their baby is at higher risk.
Cronobacter infections in infants are rare but serious. According to the CDC, the first sign is usually a fever along with poor feeding, excessive crying, or very low energy, and some infants may have seizures. Infants with these symptoms should see a medical provider as soon as possible. This is general information, not a diagnosis.
Families who use WIC can contact their local WIC clinic about which formula brands and types are currently covered.
The pending federal legislation Marler referenced has not become law, and the parent lawsuits have not been resolved. MedicalDaily will follow the litigation and any new federal testing requirements.
Key Questions Answered
How much did Abbott agree to pay? A total of $384,999,040, including $348,700,868 to the United States and $36,298,172 to certain states for Medicaid and WIC claims.
Did Abbott admit wrongdoing? No. The Justice Department said the claims are allegations only and that there has been no determination of liability.
Is there a recall right now? No. The settlement is not tied to a current recall, and consumers are not being asked to stop using any product.
What is Cronobacter sakazakii? It is a rare bacterium that can survive in dry foods such as powdered formula. It can cause dangerous blood infections or meningitis in infants.
Does this money go to affected families? No. It goes to federal and state programs, with $69 million going to three whistleblowers. Lawsuits filed by parents are still pending.
What symptoms should parents watch for? A fever with poor feeding, excessive crying, or very low energy. Some infants may have seizures. Infants with these symptoms should see a medical provider as soon as possible.
How can families check for recalls? Check the lot code on the bottom of the formula container against FDA and manufacturer recall notices, and make sure the product is not expired.
