More Syngenta Corn Settlement Details

OMAHA (DTN) -- It may be at least a year before farmers and others start to receive payments from a $1.51 billion settlement from a lawsuit filed following Syngenta's release of Agrisure Viptera and Agrisure Duracade MIR162 corn traits.

A federal court recently approved three additional subclasses of parties allegedly hurt by Syngenta's actions, according to an April 10, 2018, court order from the U.S. District Court for the District of Kansas in Kansas City.

The settlement now will include three additional subclasses. That includes any producer who owned any interest in corn in the U.S. priced for sale, purchased Agrisure Viptera and/or Agrisure Duracade corn seed, and produced corn grown from those traits. The settlement also will include any grain-handling facility and ethanol plant that owned interest in corn priced for sale during the period.

Court documents show Syngenta was required to make about $400 million in initial payments to the escrow account by the end of March. The final $1.1 billion is due either by April 1, 2019, or 30 days after the court's final approval order, whichever comes later. Payouts will not begin until the total funds are deposited and the court approves the final settlement.

Paul Minehart, Syngenta's head of corporate communications for North America, said in a statement the company supports the settlement.

"Syngenta is pleased that the court granted preliminary approval to the settlement, which allows Syngenta to avoid the burden, distraction and uncertainty of ongoing litigation and to continue its focus on agricultural innovation," he said in a statement to DTN. "Agrisure Viptera and Agrisure Duracade demonstrate significant, scientifically validated benefits for growers in combatting a wide spectrum of pests. Syngenta launched these products to help ensure that American farmers could access the latest seed technology approved in the U.S. and to help farmers increase their productivity and crop yield."

According to the court order last week, corn producers involved in the settlement number in the "thousands," while there are more than 1,500 grain handlers and more than 180 ethanol producers affected.

So far, it's unclear how much farmers and other parties will receive.

The court acknowledged in last week's order that the $1.51 billion settlement may not account for all damages in the case. Original lawsuits estimated the damages at near $5 billion.

"The amount of the settlement ($1.51 billion) is very large in an absolute sense, and it represents a significant percentage of the actual nationwide damages alleged by the MDL plaintiffs' experts," the court said in its order.

"Although the plaintiffs prevailed in the first trial (Kansas), that verdict is subject to post-trial review and appeal, and given the disputed nature of the factual and legal issues, other plaintiffs face a significant risk of little or no recovery in future trials. Therefore, it is reasonable to believe that the immediate recovery of such a substantial sum is more valuable than the mere possibility of a more favorable outcome after protracted and expensive litigation over many years in the future."

In June 2017, a jury awarded farmers $217.7 million in compensatory damages in what was the first lawsuit filed against Syngenta on the shipment of Viptera corn to China. The trial was one of several on tap in the U.S. District Court for the District of Kansas in Kansas City.

The lawsuit was filed by four Kansas farmers who represent more than 7,000 farmers in the state. It is the first of multiple lawsuits claiming Syngenta should have inspected and prevented harvested Viptera (MIR 162) corn from being shipped to China in 2013 and 2014.

Plaintiffs in the case allege Syngenta sold corn with Agrisure Viptera and Duracade traits prior to the traits receiving import approvals in several countries, including China. China claims it found and rejected corn shipments containing the traits, which plaintiffs say led to lower corn prices.

The official lawsuits filed on behalf of corn producers include cases in Alabama, Arkansas, Colorado, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Nebraska, North Carolina, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, Texas and Wisconsin.

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

Follow him on Twitter @toddneeleyDTN

(AG/ES)