Abbott Labs to Pay 5M in Settlement Over Baby Formula Contamination Scandal

Abbott Labs to Pay $385M in Settlement Over Baby Formula Contamination Scandal

Abbott Labs settles $385M case over baby formula contamination. DOJ closes criminal probe, but questions linger.

September 14, 2026 One Min Read

POLICY WIRE — Chicago, United States — Abbott Laboratories has agreed to pay nearly $385 million to settle a civil False Claims Act lawsuit related to bacterial contamination at its Michigan facility that produces powdered infant formula, according to the Justice Department.

The case involved allegations that the company operated under unsanitary conditions, putting products at risk of microorganism contamination and compromising their safety and quality. The settlement came after federal prosecutors initially sought felony charges, but senior Justice Department leaders decided against pursuing them.

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Associate Attorney General Stanley Woodward condemned the company’s actions, stating that no firm should jeopardize infants’ health by maintaining unsafe conditions. Abbott claimed the settlement does not imply fault or liability and noted that government tests on formula samples from affected homes showed no signs of Cronobacter sakazakii. The decision to close the criminal investigation marks a trend of softer enforcement in public health cases, as seen in other recent corporate settlements.

Reporting by Policy-Wire (PW)

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