Paul Goeringer, Extension Legal Specialist
Department of Agricultural and Resource Economics, College of Agriculture and Natural Resources, University of Maryland
On April 10, 2018, a federal district court judge granted preliminary approval to the $1.51 billion MIR162 Syngenta settlement. This settlement, reached in September 2017 and officially announced in March 2018, would settle claims by U.S. farmers for Syngenta bringing Viptera and Duracade corn varieties to market before approval in China. This approval means corn growers in the Mid-Atlantic region will begin to see formal notices hitting their mailboxes in May, and the claims process will begin. Corn growers and eligible landlords will be able to file claims electronically beginning May 11, 2018, at www.cornseedsettlement.com, or by calling 1-833-567-CORN(2676) to request a paper form. Corn growers and eligible landlords will need to file a claim by October 12, 2018.
The settlement includes all U.S. corn farmers, including those who opted out of the original class action suit and those who grew Agrisure Duracade corn and Agrisure Viptera corn varieties. The settlement will also include landlords who based rental rates on yield or price, such as a flex-lease based on yield or price or a crop-share lease. Fixed cash landlords are not eligible to participate. The period included in the settlement is September 15, 2013 through the 2018 crop year. Corn growers and eligible landlords are not required to retain an attorney to assist in collecting on this settlement.
The settlement will include four classes defined as:
Class 1: Growers and eligible landlords who did not use Duracade or Viptera,
Class 2: Growers and eligible landlords who did use Duracade or Viptera,
Class 3: Grain handlers, and
Class 4: Ethanol producers.
Claims to three of the four classes will be limited in the amount that may be recovered:
- Class 2 will be limited to $22.6 million,
- Class 3 will be limited to $29.9 million, and
- Class 4 will be limited to $19.5 million.
Class 1 will receive a minimum of $1.44 billion, with the bulk of the settlement going to corn growers and eligible landlords who did not grow Duracade or Viptera corn seeds. If a person qualifies in two classes (for example, you grew Duracade seed one year but not in other years), you are permitted under terms of the proposed settlement to collect as long as the recovery is not duplicative. The settlement does not allow for recovery of silage or fed-on-farm corn.
Corn growers and eligible landlords in Class 1 and Class 2 will prove the amount they are entitled to recover using USDA’s Form FSA 578. This form determines the corn grower’s or eligible landlord’s corn acreage minus any failed acres and silage acres. Multiply the acreage by the county average yield for the marketing year reported by NASS, deducting the percentage of bushels fed on the farm reported by the corn grower or eligible landlord, multiplying by the marketing year weighted average to get the recovery amount for that marketing year.
The weighted averages for each market year are:
- 2013/14 – 26%
- 2014/15 – 33%
- 2015/16 – 20%
- 2016/17 – 11%
- 2017/18 – 10%
The weighted averages represent damage impact determined by the plaintiffs’ economic experts during the Kansas trial. For example, if a corn grower or eligible landlord seeking recovery had reported 100 acres on her FSA Form 578 with a county yield of 150 bushels per acre and no silage or fed on-farm corn reported in marketing year 2014/15, then the corn grower or eligible landlord is entitled to a 2014/15 compensable recovery quantity of 4,950 bushels for the 2014/15 marketing year. At this time, a dollar value on that compensable recovery quantity is unknown. The recovery method for the other two classes (grain handlers and ethanol producers) will follow a different format. This overview will not cover those recovery methods.
Corn growers or eligible landlords have until August 10, 2018, to file an objection as to why the court should not grant final approval to the settlement, or to opt-out of the settlement. Many growers may have already opted out of the class action, but may need to opt-out again based on the language of the proposed settlement agreement. Corn growers or eligible landlords who do nothing will receive no settlement payment and conclude any legal claim once the court grants final approval to the settlement.
The court has set a final approval hearing on the settlement for November 15, 2018, at 1 pm in Kansas City. According to the order granting preliminary approval, payment of settlement claims should happen no later than April 1, 2019.
