Washington Attorney General Bob Ferguson announces a lawsuit against Ostrom Mushroom Farms of Sunnyside in August 2022 in Seattle. The suit was settled May 16, 2023, for $3.4 million.

SUNNYSIDE, Wash. — The former owner of a mushroom farm in Sunnyside, Washington, will pay $3.4 million to settle a lawsuit filed by Washington Attorney General Bob Ferguson accusing it of discriminating against female U.S. workers.

Ostrom Mushroom Farms, which ceased to exist in February after more than 50 years in business, did not admit any of the allegations, but agreed to the settlement to end the litigation, according to an order filed May 16 in Yakima County Superior Court.

Ferguson announced the lawsuit in August at an event staged in Seattle with the United Farm Workers. The suit alleged Ostrom favored foreign seasonal workers who, Ferguson claimed, have “fewer rights.” His office cited a Southern Poverty Law Center report that called the H-2A visa program “close to slavery.”

With the lawsuit unsettled, Ostrom sold its operations to Greenwood Mushroom Farm of Ontario, Canada, in February. In a separate order filed May 16, Greenwood agreed not to discriminate against U.S. workers.

Greenwood CEO Clay Taylor said in an interview the company doesn’t need to hire foreign workers because it has enough local applicants. “We take great pride in our relationship with our employees,” he said.

Greenwood mushrooms are sold under the Windmill Farms brand.

In a press release, the UFW welcomed the settlement and said it will continue to seek union recognition.

Ostrom grew mushrooms in Lacey for 50 years before moving to Sunnyside in 2019. The company said its operations had become incompatible with a growing urban area.

State lawmakers appropriated $1 million to prepare the site of Ostrom’s new indoor-growing facility at the Port of Sunnyside. Ostrom employed about 200 workers, according to court records.

“Ostrom’s investment in state-of-the-art facilities and in a dedicated local workforce over the past four years helped solidify the production of high-quality mushrooms as a valuable economic driver in this region,” according to a written statement from Ostrom.

The money from the settlement will compensate workers allegedly discriminated against, according to the attorney general’s office, which estimated 170 people will be eligible for payments.