Court: No Evidence of Chem Price Fix
Companies Win Chemical Price-Fixing Antitrust Lawsuit Filed by Farmers
LINCOLN, Neb. (DTN) -- A federal court dismissed an antitrust lawsuit that accused large agriculture companies, including Bayer, Corteva Agriscience and Syngenta, of conspiring to fix the prices of crop inputs, including herbicides, fungicides and insecticides.
Farmer plaintiffs in Illinois and Minnesota filed a petition in 2021 with the U.S. District Court for the District of Eastern Missouri in St. Louis, alleging a group of agribusinesses conspired to boycott electronic trading platforms, causing millions of dollars of damages to farmers from lack of competitive prices for crop inputs.
The plaintiffs alleged the companies worked to keep the price of crop inputs higher dating back to 2014 by operating an alleged "secretive supply-chain" process that prevented farmers from comparison shopping for seeds, chemicals and other inputs.
Companies named in the lawsuit were Syngenta, Bayer, Corteva, BASF, Cargill, Winfield Solutions, Univar Solutions, CHS Inc., Nutrien Ag Solutions, GROWMARK Inc., Simplot AB Retail Sub Inc., Tenkoz Inc. and Federated Cooperatives Ltd.
Those companies filed a motion to dismiss the case on multiple grounds, and the court agreed with their arguments.
They argued the plaintiffs had not pleaded a "plausible boycott conspiracy" either directly or circumstantially. The companies said the plaintiffs had not alleged an injury was caused to support antitrust claims and that the Sherman Act was time-barred, among other things.
"Here, plaintiffs concede that they have no direct evidence of a conspiracy," the court said in an order issued on Sept. 13, "so they must plead the existence of the alleged conspiracy through circumstantial evidence showing parallel conduct accompanied by plus factors. Defendants argue that plaintiffs have failed to plausibly plead parallel conduct and frequently engage in impermissible group pleading as opposed to providing nonconclusory factual allegations connecting specific defendants to the alleged conspiracy."
The plaintiffs argued that starting in at least 2014, independent crop input sales platforms "threatened defendants' supra-competitive prices, dominant market position, control over crop input pricing and present and future access to farmers' data."
As part of the lawsuit, the plaintiffs pointed to various independent actions taken by the companies as evidence of a conspiracy.
The court said in its order that it included CHS sending a letter to its farmer members discouraging them from using a new competitor; that Bayer formed a task force to study emerging competition; that Syngenta conducted an audit in response to sales to unauthorized dealers; and that Bayer, Corteva and Syngenta have provisions in their standard contracts that authorize audits.
"Such allegations are not only conclusory and speculative; they are also another example of impermissible group pleading," the court said in its decision.
"Plaintiffs point to no specific action by any identified defendant(s), rather they assert that 'wholesaler and retailer defendants' generally conspired to induce 'manufacturer defendants' generally to cut off the supply of crop inputs to e-commerce platforms. Such generic pleading lacks the requisite specificity needed to plausibly allege a conspiracy."
The plaintiffs also alleged that a similar investigation by Canadian authorities was evidence supportive of their claims.
The court disagreed.
"Even if the court were to reach that question and credit the Canadian investigation as a plus factor supporting the involvement of certain defendants in an antitrust conspiracy, those allegations would carry little persuasive weight," the court said.
"The Canadian investigation, during which the targets were compelled to produce extensive documentation and information to the Canadian Competition Bureau, concluded without a finding of anticompetitive conduct in the Canadian crop inputs market."
Bayer said in a statement to DTN that the court's ruling was "consistent with the findings of Canada's Competition Bureau" that investigated similar allegations and closed the case without taking any further action.
"Bayer believes crop input markets are competitive, fair and diverse," the company said.
"Whether online or in-person, growers have many options to purchase agricultural products, and Bayer welcomes any business that enables us to better support growers."
A spokesperson for Corteva Agriscience said the claims made in the lawsuits consolidated in the federal court in Missouri had "no basis" and the court was "right to reject" the case.
"We have and will continue to vigorously compete in agricultural markets, supporting farmers' success by providing access to the latest innovative tools, products and on-the-ground support," Corteva said.
Todd Neeley can be reached at todd.neeley@dtn.com
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