In brief: Dannon Co. settles lawsuit

The Dannon Co. said Friday it will reimburse consumers for up to $100 of Activia and DanActive yogurt purchases and change its marketing and labeling to settle a class-action lawsuit.

The lawsuit, filed in 2008, alleges Dannon overstated the yogurt’s health benefits. The company claims the products can strengthen the body’s defenses or regulate digestion because of bacteria they contain.

White Plains, N.Y.-based Dannon, a unit of France’s Danone, denies any wrongdoing and said it settled the suit to avoid any further litigation and expense. Once the settlement is approved, consumers will be able to find out more about the process for filing for reimbursement and other information at www.Dannon Settlement.com.

Fed may monitor pay

The Federal Reserve for the first time would police banks’ pay policies to make sure they don’t encourage excessive risk taking under a plan the Fed is drafting.

The proposal is the Fed’s latest response to criticism that it failed to crack down on lax lending, reckless gambles and other practices that led to the financial crisis.

The central bank’s more activist stance carries a risk, though: It could intensify accusations from lawmakers and other critics that the Fed is overstepping its bounds and should be reined in.

Under its proposal, the Fed would review – and could reject – pay policies that could cause too much risk-taking by executives or other employers, according to two people familiar with the plan. The Fed would not actually set compensation, however, those people said.

States’ job losses rose

WASHINGTON – Forty-two states lost jobs last month, up from 29 in July, with the biggest net payroll cuts coming in Texas, Michigan, Georgia and Ohio.

The Labor Department also reported Friday that 27 states saw their unemployment rates increase in August, and 14 states and Washington, D.C., reported unemployment rates of 10 percent or above.

The report shows jobs remain scarce even as most analysts believe the economy is pulling out of the worst recession since the 1930s. Fed Chairman Ben Bernanke said earlier this week that the recovery isn’t likely to be rapid enough to reduce unemployment for some time.