ADM Ethanol Market Case Resumes in Illinois

LINCOLN, Neb. (DTN) -- An ethanol markets lawsuit against Archer Daniels Midland resumed this week after a federal court granted motions to file documents and replies under seal. ADM is fighting the court-ordered release of documents of a company accounting employee, Adam Kuffel.

On May 3, the U.S. District Court for the District of Central Illinois granted AOT Holding AG access to documents and other communications related to the 2019 suspension of Kuffel.

Kuffel was suspended without pay for allegedly violating the company's internal accounting policy.

According to a court document filed by AOT on May 31, Kuffel was suspended for "moving positions in ethanol derivatives between segregated accounts in violation of ADM's accounting policies."

Just last week, a federal magistrate granted ADM's unopposed motion to stay the lawsuit, pending a ruling on ADM's objection to the ordered release of the Kuffel information.

Attorneys for ADM alleged in an objection that the judge released sealed information in error as part of the May 3 ruling.

AOT is one of several plaintiffs that have sued ADM, alleging the company manipulated ethanol prices, violating the Commodity Exchange Act. Specifically, AOT has alleged ADM suppressed the daily benchmark price of ethanol to benefit its short positions.

At an AOT deposition of Kuffel, he said a superior ordered him to violate the policy, according to court documents. "Kuffel testified that he was acting at the direction of either Rachel Hudson or Chris Cuddy, both of whom are Kuffel's superiors at ADM," the May 3 order said.

"Central to plaintiff's theory of the case are the actions of Ray Bradbury and Adam Kuffel (ADM employees)."

AOT filed its complaint just prior to the suspension, according to the May 3 order.

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 market at the Argo, Illinois, 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.

Similar lawsuits were filed by Wisconsin ethanol producers United Wisconsin Grain Producers, Didion Ethanol, Ace Ethanol, Fox River Valley Ethanol, Badger State Ethanol and Iowa producer Pine Lake Corn. In addition, a lawsuit filed by Green Plains Inc. in Nebraska was transferred to the Illinois court.

Read more on DTN:

"ADM Ordered to Release Docs on Employee," https://www.dtnpf.com/…

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

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