ADM Ethanol Markets Case to Continue

Judge Rejects Archer Daniels Midland Motion to Dismiss Ethanol Market Case

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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A court denied an Archer Daniels Midland motion to dismiss an ongoing ethanol markets lawsuit. (DTN file photo by Chris Clayton)

LINCOLN, Neb. (DTN) -- A federal judge denied Archer Daniels Midland's motion to dismiss one of two lawsuits alleging the company manipulated the ethanol market, stating in an order last week that there is enough evidence to allow the case to continue.

Midwest Renewable Energy is one of two remaining companies that allege ADM drove ethanol prices down at the Argo terminal in Illinois in an attempt to drive away competition.

The other company, AOT Holding, also filed a similar complaint. Both cases were filed in the U.S. District Court for the District of Central Illinois.

An order initially was posted to the docket on Sept. 26 and then removed because it contained "confidential" information, according to a later text order posted by the court in the Midwest Renewable Energy case.

The court ruled that Midwest Renewable Energy's lawsuit can continue, despite efforts by ADM to have it dismissed.

The court dismissed MRE's original lawsuit in August 2021 and the company filed an amended complaint.

Both complaints alleged ADM violated the Sherman Antitrust Act in committing monopoly and attempted monopoly in the ethanol market.

In dismissing MRE's first complaint the court held the plaintiff did not prove antitrust injury.

The court said in the order pulled from the docket last week that Midwest Renewable Energy's amended complaint had sufficiently corrected deficiencies that were found in the first complaint.

MRE alleged in the amended complaint that ADM made about 67% of all sales both inside and outside of the trading window at the Argo terminal in Illinois.

That amended complaint lists nearly 20 ethanol plants that either shut down or scaled back production because of market concerns in November and December 2018.

Also, the court is expected to consider a motion filed by Midwest Renewable Energy for class certification, as part of the antitrust action. If approved by the court, other companies similar to Midwest Renewable Energy could be awarded damages if the cases go the plaintiffs' way.

In the AOT Holding lawsuit, attorneys also filed a motion for class certification on Sept. 22.

The lawsuits allege ADM manipulated the market at the Argo terminal by flooding the fuel terminal with lower-priced ethanol starting in November 2017 through March 2019. The Argo terminal is the daily location for ethanol trading. The court said the specific trading in question occurred during the 30-minute "market-on-close," or MOC, window.

The trading window is considered crucial because the trading is used to set the daily Chicago benchmark price to determine the value of Chicago ethanol derivatives.

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"Expert: ADM Manipulated Ethanol Market,"…

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