ADM Continues to Fight Ethanol Witness

LINCOLN, Neb. (DTN) -- The saga centered on whether an expert witness can testify in an ongoing ethanol markets class-action lawsuit against Archer Daniels Midland continues, as a federal judge last week made a key ruling in the case.

The fate of the witness, Shaun Ledgerwood, may not be decided until sometime in the fall.

In December 2024, ADM and plaintiff AOT Holding AG debated whether AOT's witness Ledgerwood should be allowed to present his findings using a so-called regression analysis model he created on behalf of AOT Holding 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.

Following a hearing on Dec. 6, the U.S. District Court for the District of Central Illinois entered an order setting a briefing schedule for what is expected to be a motion filed by ADM to exclude Ledgerwood's testimony.

That ADM motion was due on Feb. 12, 2025, however, the plaintiffs disclosed a supplemental document from Ledgerwood on Jan. 28, 2025. According to a court order last week, that document includes supplemental information from Ledgerwood.

ADM argued the updated information should be stricken from the record as an "improper supplement" to an expert opinion.

According to the court, the updated information includes new calculations as to how AOT alleges ADM's actions affected the market.

Ledgerwood is a former economist at the Office of Enforcement of the Federal Energy Regulatory Commission.

Court-appointed expert Jeffrey M. Wooldridge, the university distinguished professor of economics at Michigan State University, reportedly concluded AOT did not suffer economic damage from ADM's alleged actions.

Wooldridge has been involved in critiquing Ledgerwood's conclusions as part of vetting him as a witness.

"While the court does recognize a degree of willfulness in plaintiffs' and Ledgerwood's delayed acceptance of Wooldridge's critiques, for the reasons stated above, the prejudice or surprise to ADM is little to none," District Judge Colin S. Bruce said in the order.

"To the extent there is any prejudice to ADM from the supplement (and also as explained above, Ledgerwood's supplement and revised damages calculations in that supplement inure somewhat to ADM's benefit), the court will cure that prejudice by setting a new briefing schedule so that ADM can fully digest the supplement's implications and submit it for review to ADM's expert Kaplan (David). Finally, as trial dates have not been set (nor even dispositive motion dates), there is no chance of disruption to trial."

ADM's motion to exclude Ledgerwood is now due by July 1, 2025, according to the order.

The model Ledgerwood developed, according to court documents, includes the 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; the gasoline price in New York Harbor; the price of renewable identification numbers, or RINs; the amount of ethanol and gasoline stocks in the U.S.; and U.S. imports and exports of ethanol and Chinese tariffs on those.

ADM has 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.

AOT and other companies have alleged that ADM 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. 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.

Read more on DTN:

"Expert Witness Who Alleges ADM Manipulated Ethanol Market Sees Credibility Examined in Court," https://www.dtnpf.com/…

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

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