ADM Trial Set for 2024

LINCOLN, Neb. (DTN) -- With a trial possibly years away in an ongoing ethanol market manipulation case, plaintiffs are waging a fight for the disclosure of information from Archer Daniels Midland, according to court documents.

Four cases have been combined in the U.S. District Court for the Central District of Illinois in Urbana. All the plaintiffs allege ADM manipulated the ethanol market at a key trading hub between 2017 and 2019.

At the end of last week, AOT Holding AG, Maize Capital Group LLC, Midwest Renewable Energy LLC, Green Plains Trade Group Limited, and a group of six ethanol companies led by United Wisconsin Grain Producers LLC filed a joint motion to compel ADM to respond to their discovery request.

The lawsuits all allege ADM intentionally manipulated and artificially depressed the price of ethanol by targeting ethanol sales activity at the Argo terminal in Illinois.

The Argo terminal is the daily location for ethanol trading. The 30-minute trading window at the terminal is considered crucial because it is used to set the daily Chicago benchmark price to determine the value of Chicago ethanol derivatives.

That benchmark is used to price and settle ethanol derivatives on the New York Mercantile Exchange and the Chicago Board of Trade.

The plaintiffs asked the court to compel ADM to provide a list of documents and other evidence, including company policies and procedures for "deleting and placing litigation holds on documents," as well as mobile devices used by ADM ethanol traders.

The companies also have asked for ADM's "litigation holds and preservation efforts" for employees involved in the ethanol business, as well as records of "inquiries and investigations into ADM's trading of ethanol or ethanol derivatives," along with communications with "regulatory bodies or self-governing organizations related to such inquiries and investigations."

Unless a settlement is reached, the case is likely to take years to resolve.

According to a court order, a trial in the cases is scheduled for Jan. 30, 2024. All sides have until Nov. 18, 2022, to complete discovery.

In addition, the court has yet to rule on a January ADM motion to dismiss the United Wisconsin Grain Producers LLC lawsuit. ADM argued in its dismissal motion the cases involving producers suing producers don't qualify as an antitrust case.

ADM added in the motion that, at 10% of the market, the company does not have a dominant share to support the plaintiffs' claim of a monopoly.

The ethanol producers filed a response in opposition to dismissal.

"Plaintiffs' complaint explains in vivid detail how defendant ADM, facing declining profitability in its ethanol business, engaged in an unlawful scheme guaranteed to maximize the short-term and long-term profitability of that business at the expense of every other market participant," the companies said in a motion.

"Put in the simplest terms, ADM unlawfully and artificially depressed ethanol prices at the Argo terminal thereby depressing the Chicago Pricing Indexes that are then used as the reference point to set the price for over 70% of the U.S. ethanol market. ADM's motion to dismiss is premised largely on its implied assertion that, regardless of what it did, it cannot be held liable for any harm it caused because it lowered prices for purchasers of ethanol. This is clearly not the law."

In November, Wisconsin producers United Wisconsin Grain Producers, Didion Ethanol, Ace Ethanol, Fox River Valley Ethanol, Badger State Ethanol and Iowa producer Pine Lake Corn filed their lawsuit. All the cases are pending in the federal court in Illinois.

Read more DTN coverage here:

-- "Ethanol Price Manipulation Case Moves" (https://www.dtnpf.com/…)

-- "ADM Motions to Dismiss Ethanol Case" (https://www.dtnpf.com/…)

-- "Ethanol Case Moves to Illinois" (https://www.dtnpf.com/…)

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley

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