Manufacturers, Wholesalers, Retailers Crop Input Antitrust Class Action

This class action brings an antitrust suit against three groups of companies involved in the manufacturing, wholesaling, and retailing of crop inputs. Crop inputs include seeds and crop protection chemicals, like fungicides, herbicides, and insecticides. The complaint alleges, “The existing distribution process maintains supracompetitive Crop Input prices by denying farmers accurate product information, including pricing information, which would allow them to make better-informed purchasing decisions.”

The class for this action includes two groups:

• All persons or entities living in the US who, between January 1, 2014 and the date the effects of the unlawful conduct end, bought from one of the defendants in this case a crop input made by one of the manufacturing defendants, and
• All persons or entities who, between January 1, 2014 and the date the effects of the unlawful conduct end, bought from a retailer other than one of the retailer defendants in this case a crop input made by one of the manufacturing defendants.

Yes, farmers are getting better yields with new crop inputs, but the price they must pay for them
“is increasing at a rate that dramatically outpaces yields—for example, over the last 20 years, the price of seed corn rose 300%, while corn yields increased only 33% to 35%.”

The complaint alleges, “This disparity is proving increasingly devastating to farmers, who are not the least profitable level of the American food supply chain and are drowning in hundreds of billions of dollars of operating debt that is forcing them into bankruptcy at a record pace.”

In 2016 and 2017, new sales platforms appeared, including Farmers Business Network (FBN) and AgVend, Inc. The complaint says that these “aimed to provide a cheaper, more transparent way for farmers to buy Crop Inputs” by bringing products directly from the manufacturers to farmers, “circumventing the opaque, convoluted distribution system.”

This threatened to upset the manufacturers’, wholesalers’, and retailers’ dominance of the market. According to the complaint, instead of competing fairly, these parties “conspired to block the platforms’ access to Crop Inputs by engaging in a group boycott.” Manufacturers and wholesalers agreed not to sell to FBN, for example, the complaint alleges.

In response, FBN bought a retailer that had existing agreements with manufacturers, but the complaint alleges that the manufacturers retaliated by canceling the agreements, and also refused to sell to AgVend.

The complaint charges, “As a result of [the companies’] misconduct, farmers remain trapped in an inefficient, opaque Crop Input market that eliminates their profits and destroys their livelihoods.”

The defendants in this case include the following companies:

• Manufacturers: Bayer CropScience Inc., Corteva Inc., Syngenta Corporation, and BASF Corporation
• Wholesalers: Cargill Incorporated, Winfield Solutions, LLC, Univar Solutions, Inc.
• Retailers: CHS Inc., Nutrien Ag Solutions Inc., Growmark Inc., Simplot AB Retail Sub, Inc., Tenkoz Inc., and Federated Co-operatives Limited

Article Type: Lawsuit
Topic: Agriculture
Tags: Agriculture, Antitrust, Collusion and Price Fixing