A year and 10 days before a federal jury trial was scheduled to begin, Village Farms International Inc. agreed to accept a final payment of $11.25 million from Travelers Insurance Co. related to hail damage at its Texas greenhouses in May 2012.
That brings the total paid to the British Columbia, Canada, greenhouse company to $49.2 million, said Stephen Ruffini, Village Farms’ executive vice president and chief financial officer.
“We think this is a fair and equitable settlement,” Ruffini said Sept. 6. “It is unfortunate it took a long time, but we had never had a claim this large and I’m told large claims take more time.”
Ruffini said Village Farms is on schedule to have 60 acres of the 80 damaged greenhouse acres in Texas in production by spring or summer 2014. The company has three large greenhouses in Marfa, Texas. The May 2012 hailstorm destroyed about half of the greenhouse acres and significantly damaged the other half, according to court documents.
Village Farms, which has U.S. headquarters in Heathrow, Fla., filed a case against Travelers Insurance in Federal Court in Texas on July 31 seeking $18.5 million.
The greenhouse company alleged the insurance company failed to pay full amounts for property damage and lost business income. A jury trial was set for Sept. 16, 2014.
According to the original complaint filed by Village Farms, the insurance company also failed to make prompt payments on the hail damage claim. As of February this year Travelers Insurance had paid only $1 million to Village Farms for business interruption since the storm damage, according to the Federal Court complaint.
If repairs go as planned, the greenhouse grower expects to have 130 acres in production in Texas by spring or summer 2014, said Village Farms chief executive officer Michael DeGiglio in a news release.
“This will allow for the fulfillment of our growing retailer demand as well as provide incremental production area for the growing demand of our new exclusive varieties,” DeGiglio said in the release.
Corrected content: This story originally had the date of the jury trial incorrect. The trial was set for Sept. 16, 2014.