Court Combines Seed Company Lawsuits Against AltEn

Bayer: Nebraska Ethanol Plant Mishandled Treated Seed, Violated Agreement

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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A federal judge issued an order Monday to consolidate all lawsuits filed by seed companies against AltEn LLC, the owner of a closed ethanol plant in Mead, Nebraska. (DTN file photo)

LINCOLN, Neb. (DTN) -- A federal judge in Nebraska on Monday consolidated all lawsuits filed by seven seed companies against Mead, Nebraska, closed ethanol plant owner AltEn LLC.

The lawsuits allege AltEn's owner abandoned the 25-million-gallon ethanol plant site and left an environmental cleanup to the seed companies.

AltEn stored tons of corn seed treated with neonicotinoid insecticides and fungicides. More than 84,000 tons of distillers grain from those treated seeds also was stacked outside the ethanol plant because the distilled grain could not be used safely for feed or land applications.

AltEn did not dispose of the pesticide-contaminated distillers grains and wastewater properly. The seed companies have been undertaking cleanup of lagoons near the plant.

At the end of February, six seed companies that provided pesticide-treated corn seed to the ethanol plant sued AltEn. Those companies include Pioneer Hi-Bred International Inc., Corteva Agriscience LLC, AgReliant Genetics LLC, Beck's Superior Hybrids Inc., Winfield Solutions LLC, and Syngenta Seeds LLC.

Bayer AG filed a similar lawsuit at the beginning of March in the same U.S. District Court for the District of Nebraska in Omaha.

As did the other seed companies, Bayer accused AltEn and its president Tanner Shaw of selling off its assets, abandoning the Mead site and not helping in the cleanup effort. Bayer asked the court to void any asset sales by AltEn and to issue an injunction preventing additional sales.

"Bayer joins the other members of the facility response group (or FRG) that have filed lawsuits against AltEn," Bayer said in a statement to DTN, "to hold the company accountable for violating the terms of our individual contracts and mismanaging the site in a way that has led to its current condition.

"At the same time, Bayer continues to work as part of the FRG to ensure the site is stable while exploring alternatives for the NDEE (Nebraska Department of Environment and Energy) to consider as permanent remediation for the people of Mead."

AltEn President Tanner Shaw did not respond to DTN's request for comment.

The seed companies have joined forces to voluntarily clean up the Mead site. All of those companies have alleged in court AltEn's actions have hindered those efforts.

At the end of last year, the state of Nebraska approved plans by the seed companies to treat 150 million gallons of pesticide-contaminated water now stored at four lagoons on the AltEn property.

The AltEn plant ran into a series of environmental problems and was shut down by the state in February 2021 after ignoring state regulations.

The seed companies allege AltEn not only physically abandoned the ethanol plant but left the seed companies to pay debts and other AltEn financial obligations, just to continue the cleanup operation.

Instead of cooperating in the cleanup operation, the lawsuits allege AltEn has been selling off assets to divest from the ethanol plant.

BAYER'S LAWSUIT

Bayer alleged in its March lawsuit that AltEn violated an agreement that governed the sale of Bayer's treated and untreated seed to AltEn. Bayer said AltEn failed to report the environmental violations to Bayer.

AltEn was "obligated" to handle and store the seed safely and to segregate the materials from other seed "whose byproduct might be used for livestock feed or agronomic purposes," according to the lawsuit.

Bayer said AltEn was required to convert all solid byproducts derived from the treated seed into biochar, to recycle any liquid byproducts derived from the seed, and to pay Bayer for the treated seed.

Also, Bayer said any treated seed not used by AltEn was required to be returned to Bayer. In addition, Bayer alleged AltEn failed to provide insurance coverage to Bayer as an "additional insured" in AltEn's liability policies.

"These and other failures led to the release of untreated thin stillage and manure from a tank at the AltEn plant that flowed onto neighboring properties," Bayer said in the lawsuit, "the stockpiling of thousands of tons of wet cake byproduct, and the mismanagement of millions of gallons of wastewater in lagoons that were, under AltEn's management, perilously close to failure."

Despite concerns about materials at the plant, AltEn's Shaw, in December 2021, informed Nebraska regulators that he had plans to sell 600 "supersacks" of biochar from treated seed even though tests from the Nebraska Department of Environment and Energy showed the biochar had elevated levels of neonicotinoid pesticides.

Shaw planned to sell the biochar to a Kansas farmer, Brady Yingling, who operates a farm and ranch operation near Topeka, Kansas, as well as a lawn-care company. Once Yingling learned the biochar contained chemicals from treated seeds, he canceled the purchase.

Read more on DTN:

"Seed Companies Sue AltEn Over Cleanup," https://www.dtnpf.com/…

"AltEn Owner Tries to Sell Toxic Biochar," https://www.dtnpf.com/…

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

Follow him on Twitter @DTNeeley

Todd Neeley