Court Freezes Neb. Ethanol Plant Assets

Court Freezes Nebraska Ethanol Company Assets, as Seed Companies' Cleanup Tab Rises

Todd Neeley
By  Todd Neeley , DTN Environmental Editor
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A federal court has frozen the assets of the company that operated an ethanol plant in Mead, Nebraska. (DTN file photo)

LINCOLN, Neb. (DTN) -- A federal court froze the assets of the owners of a now-defunct Mead, Nebraska, ethanol plant on Wednesday as major seed companies continue to lead an environmental cleanup at the plant.

Back in February 2022, seed companies led by Bayer filed a series of lawsuits against AltEn LLC in the U.S. District Court for the District of Nebraska in Omaha, alleging the company was selling off assets, had abandoned the plant and was not helping in the cleanup effort.

On Wednesday, the court issued an order granting a preliminary injunction to freeze AltEn assets except for funds needed by the company to continue permitting and other needed operations, including groundwater monitoring.

The seed companies, including Bayer, Syngenta Seeds LLC, Pioneer Hi-Bred International Inc., Corteva Agriscience LLC, Agreliant Genetics LLC, Beck's Superior Hybrids Inc. and Winfield Solutions LLC, have spent tens of millions of dollars so far in the cleanup, according to the court's order.

"Seed companies have shown a threat of irreparable harm from an unrecoverable judgment in the absence of a preliminary injunction, in light of the seed companies' expenditure of nearly $28 million so far to fulfill the operators' remediation obligations, which the seed companies seek to recover in this action," the court said in the order.

AltEn has about $1.8 million in cash assets remaining, the court said, and is spending about $100,000 a month to maintain permitting and other obligations at the site.

The state of Nebraska filed a brief with the court in opposition to a complete asset freeze. The state was concerned AltEn would be unable to maintain permitting and other necessary functions at the site during cleanup.

The asset freeze includes several AltEn-affiliated companies, including Earth Energy and Environment LLC, AltEn Operating Company E3, Integrated Recycling LLC, E3 Biofuels LLC, Falcon Energy LLC and Mead Acquisition Company LLC.

According to a memorandum filed by the court, AltEn president Tanner Shaw has accounted for millions of dollars generated through asset sales made by the company.

The seed companies' lawsuits came nearly six weeks after the state approved plans by AltEn's "Facility Response Group" -- AFRG, a group headed by seed companies and remediation engineers -- to treat 150 million gallons of pesticide-contaminated water stored at four lagoons on the AltEn property.

The seed companies are attempting to recover from AltEn the ongoing costs of cleanup.

The plant ran into a series of environmental problems and was shut down by the state in spring 2021.

AltEn stored on-site corn seeds treated with neonicotinoid insecticides and fungicides. AltEn did not dispose of the pesticide-contaminated distillers grains and wastewater properly. A group of seed companies that provided seed to the plant have been undertaking cleanup of lagoons near the plant.

In the summer of 2021, the state of Nebraska granted approval to a voluntary cleanup of the site requested by a coalition of companies that includes AgReliant, Bayer U.S. LLC, Beck's, Corteva, Syngenta and WinField.

The seed companies alleged in their lawsuit that AltEn not only physically abandoned the ethanol plant but "financially abandoned" the operation, including its debts and other obligations. The actions by AltEn, the companies said, were hurting the efforts to clean up the site.

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:

"AltEn Owner Tries to Sell Toxic Biochar,"…

"Health Monitoring Planned in Mead, NE,"…

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Todd Neeley

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