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NORWAY -- Norway Schools Superintendent Randy Van Gasse received bids for milk service this summer from what he thought were two different companies, Jilbert’s and Morning Glory.  But after talking to the United States Department of Justice, he learned they are both owned by Dean Foods.

"One comes in at two-tenths of a cent less per carton of milk than the other; you would like to think that's an honest bid,” said Van Gasse.  “But in this case where the same company owns both of these providers, I'm not so certain."

The Department of Justice filed an antitrust lawsuit against Dean Foods for its acquisition of Foremost Farms last year.  The lawsuit alleges that the move “reduced competition substantially in the sale of milk to school districts in the U.P. and Wisconsin...these districts have been left with a monopoly provider."

Dean Foods and Foremost Farms were two of the biggest milk providers before the acquisition.

"I was a little disappointed because I thought we're actually getting competitive bids, and as it turns, out we were not,” Van Gasse said.  “It's not a process.  It's not a legitimate bid process and that's what concerns us."

Similar to schools, grocery stores like Marcouiller's in Niagara will be keeping a close eye on the lawsuit.  In fact their milk sales have dropped since the acquisition was announced back in April 2009.

"It's affected sales a bit,” said Marcouiller’s Dairy Manager Charlie Freeman.  “A lot of people like to see the Morning Glory label and now they switched the label and people are asking questions, sales are a little bit lower...and now there's no competition so they kind of pretty much dictate the market."

In a statement, Dean Foods said it has been “fully compliant with antitrust laws, and will defend itself vigorously against the complaint.”