ADM Ethanol Lawsuit Nears Key Ruling

LINCOLN, Neb. (DTN) -- A federal judge in an ongoing class-action lawsuit against Archer Daniels Midland may be getting closer to rendering a final decision on whether to allow a key witness to testify in an ongoing ethanol markets lawsuit.

The U.S. District Court for the Central District of Illinois is again considering whether an economic model created by an expert witness works and whether the witness hired by the plaintiff, AOT Holding AG, should be excluded from testifying.

In recent months, ADM filed its fifth motion to exclude witness Shaun D. Ledgerwood from presenting his findings using a so-called regression analysis model he created on behalf of AOT and Maize Capital Group LLC, a second plaintiff in a related case.

That model, AOT alleges, shows ADM manipulated the ethanol market at the Argo terminal in Illinois. Ledgerwood is a principal at the Brattle Group, Inc. and a former economist at the Office of Enforcement of the Federal Energy Regulatory Commission.

The court issued an order on May 28, 2026, directing the court's independent expert to further study the validity of the model.

The requests made by the court in the new order suggest a final decision on Ledgerwood may soon be made.

BOTTOM LINE ASSESSMENT REQUESTED

The court is asking Professor Michael Wooldridge to consider three specific issues as they relate to the Ledgerwood model, concluding with a "bottom line" assessment of the model.

Wooldridge, an Ashall Professor of Foundations of Artificial Intelligence at the University of Oxford, previously testified at an evidentiary hearing that it was improper to award damages for trades on days where there is no price suppression.

"Having read the parties' briefs, it has become apparent to the court that it cannot make an informed decision on ADM's motion without the direct input of Professor Wooldridge, the court's appointed neutral expert," the court said in its order.

In its fifth motion filed with the court to exclude the witness, ADM argues Ledgerwood's model calculates damages even on days when there was no price suppression.

According to the order, ADM argues the model could be generating hundreds of millions of dollars in "phantom" damages.

Wooldridge is asked to study whether the model improperly assumes that ADM alone moved ethanol prices, whether the model reliably estimates the price of ethanol derivatives and whether it calculates damages that are attributable to the plaintiffs' theory of liability in the case.

"As the court stated at the evidentiary hearing, it is by no means an expert in econometrics," the court said in its order.

"Professor Wooldridge should, to the extent practicable, make his report accessible to a layperson with zero background knowledge of econometrics, and who has a rudimentary, college-level knowledge of economics and mathematics."

FIRST FOUR MOTIONS

The first four motions to exclude Ledgerwood's testimony that were denied by the court, centered on the construction of the Ledgerwood model itself -- essentially the raw ingredients fed into the formula.

Attorneys for both parties are required to file a notice with the court after conferring with Wooldridge as to a possible deadline for filing a new report.

After the report is filed, according to the order, then both sides will be required to submit a proposed briefing schedule.

DTN reached out to Archer Daniels Midland as well as to an attorney representing AOT.

AOT and other companies have alleged ADM manipulated ethanol prices, violating the Commodity Exchange Act.

Specifically, AOT alleged ADM suppressed the daily benchmark price of ethanol to benefit its short positions. AOT has alleged ADM's actions benefited the company by increasing the value of ADM's "short" or "hedged" ethanol positions.

AOT filed a class-action lawsuit in May 2020, alleging ADM manipulated the daily ethanol market at the Argo terminal by flooding the fuel terminal with lower-priced ethanol starting in November 2017 through March 2019. The specific trading in question occurred during the 30-minute "market-on-close," or MOC, window.

PREVIOUS CONCLUSIONS

Wooldridge reportedly has previously concluded AOT did not suffer economic damage from ADM's alleged actions.

The model Ledgerwood developed, according to court documents, includes:

-- Futures price of corn

-- Wages paid to manufacturing workers

-- Electricity and natural gas prices

-- Prices of byproducts of ethanol production

-- Railroad transportation costs

-- Storms or other severe weather in Illinois

-- Gasoline price in New York Harbor

-- Price of renewable identification numbers, or RINs

-- Amount of ethanol and gasoline stocks in the U.S.

-- U.S. imports and exports of ethanol and the Chinese tariffs placed on them.

ADM has previously argued Ledgerwood and his report are not admissible because the model almost always finds ethanol-price suppression on ADM's part, and that he used the wrong model and data for pricing, among other issues.

Read more on DTN:

"ADM Loses Decision to Exclude Witness," https://www.dtnpf.com/….

Read more about Ledgerwood here: https://www.brattle.com/….

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

Follow him on social platform X @DTNeeley

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