Corn Farmers May Begin Filing Claims in Syngenta Settlement May 11
Judge Lungstrum granted preliminary approval for the $1.51 billion Syngenta settlement on April 10, 2018. This means that formal notice (sample here) will be mailed to class members on May 11, 2018, at which time the formal claims process will begin. Corn producers and landlords who are members of the class will be able to go online to www.cornseedsettlement.com to file their claims. If they do not have internet access, they will be able to call 1-833-567-2676 to request a paper claim form (sample here). All claims must be submitted by October 12, 2018.
Although all members of the class must file a claim by October 12, 2018, to preserve their right to a future payment, the settlement is still provisional or preliminary because Syngenta will have a limited opportunity to walk away by October 10, 2018, after receiving the final opt-out list, and the Court must determine, after all claims have been filed, whether the settlement is fair, reasonable, and adequate. The final approval hearing, after which the court would issue its final approval order, is scheduled for November 15, 2018. That date, however, could be changed without notice to the class.
Who is Included?
The settlement generally includes any person in the United States that from September 15, 2013 through April 10, 2018 (Class Period), owned any interest in corn in the United States priced for sale, if they fall within one of the following four sub-classes:
Subclass 1: Any Producer in the United States that, during the Class Period owned any Interest in Corn in the United States priced for sale during the Class Period, excluding Producers that, at any time prior to the end of the Class Period, purchased Agrisure Viptera Corn Seed and/or Agrisure Duracade Corn Seed and produced Corn grown from Agrisure Viptera Corn Seed and/or Agrisure Duracade Corn Seed.
Subclass 2: Any Producer in the United States that during the Class Period owned any Interest in Corn in the United States priced for sale during the Class Period and that, at any time prior to the end of the Class Period, purchased Agrisure Viptera Corn Seed and/or Agrisure Duracade Corn Seed and produced Corn grown from Agrisure Viptera Corn Seed or Agrisure Duracade Corn Seed. (Proposes no more than $ 22.6 million for this sub-class.)
Subclass 3: Any Grain Handling Facility in the United States that during the Class Period owned any Interest in Corn in the United States priced for sale during the Class Period. (Proposes no more than $ 29.9 million for this sub-class.)
Subclass 4: Any Ethanol Production Facility in the United States that during the Class Period owned any Interest in Corn in the United States priced for sale during the Class Period. (Proposes no more than $ 19.5 million for this sub-class.)
Crop share landlords and landlords whose rent payment is based upon yield or price are eligible to participate in the settlement, along with producers. Fixed cash rent landlords are not eligible to participate in the settlement claims process.
What are the Options?
Once provisional class members receive their notice, they have four options:
- File a claim by October 12, 2018 (online at www.cornseedsettlement.com or by paper after calling 1-833-567-2676).
- Object to the settlement by filing a motion with the court, explaining why the settlement should not be approved (the producer would remain a class member, but would not receive any payment if they don’t file a claim and the settlement is ultimately approved)
- Opt out of the settlement, which would require the producer to mail a written opt-out request to the claims administrator. The producers would receive no payment under the settlement, but could potentially file their own legal actions against Syngenta.
- Do nothing. These producers will receive no payment from the settlement, but their rights will be concluded by the settlement if final approval is granted.
It would seem to be in the best interest of anyone included in the class to file a claim. The process is straightforward and not time consuming and potential payments should be significant enough to make it worth their effort. Producers do not need to hire attorneys to file claims. They should, however, seek advice from a trusted source if they are not sure how to fill out the claim form once they have reviewed it.
Any future payments under the settlement will be based upon a claimant’s corn acreage. This acreage will be determined based upon existing government data if the claimant reported that information to USDA FSA. If claimants did report this information to FSA, they must authorize the claims administrator to access their FSA Form 578 and/or federal crop insurance information from RMA. The claim form includes an authorization section for this purpose. If the claimant did not report their acreage information to FSA, then claimants can submit their farm number, tract number, field number, corn acreage, producer share, acres grown for sileage, and failed acreage to establish their corn acreage for purposes of the settlement.
All claimants must also submit the percentage of any harvested corn for any of the crop years that was fed on the farm and not sold. They must also certify whether they purchased and planted Agrisure Viptera or Agrisure Duracade. If they did, they are not excluded from the settlement, but they are part of Subclass 2, whose members will likely receive lesser payments.
Claimants must then sign and certify their claims and submit them. Eligible landlords have a special addendum where they must report the name of the producer, the share of the crop to which the producer was entitled, and any non-sale disposition of the corn.
What Will the Payment Be?
The provisional settlement includes a $1.51 billion fund. All costs and expenses related to class notice, claims administration, notice administration, as well as attorney fees, costs, and expenses, would first be deducted from the fund. Settlement counsel has stated that they will be seeking up to one-third of the settlement fund as attorney fees, plus reimbursement for costs and expenses.
A maximum of $72 million would be allocated to subclasses 2 through 4, as noted above. The remaining fund would be used to pay members of subclass 1, which includes the U.S. corn producers who did not plant the GMO seed. The amount paid to each corn producer would be based upon their “compensable recovery quantity.” One of three methods will determine a producer’s (and eligible landlord’s) final compensable recovery quantity, after their submit their claim forms:
Method One: If acreage data was reported to FSA, multiply Form FSA 578 acres * average county yield determined through USDA NASS data
Method Two: If acreage was not reported to USDA through Form FSA 578, RMA data can be used to establish number of acres. This amount will be multiplied by average county yield determined through USDA NASS data to determine compensable quantity.
Method Three: If USDA and RMA data is not available, data reported on the claim form will be used to calculate the number of acres. That acreage will be multiplied by average county yield determined through USDA NASS data to determine compensable quantity.
The final compensable recovery quantities will be determined using the following weighted averages applied to each marketing year:
- 2013/14 – 26 percent
- 2014/15 – 33 percent
- 2015-16 – 20 percent
- 2016-17 – 11 percent
- 2017-18 – 10 percent
Each claimant, if the settlement is ultimately approved, will receive the proportion of the fund set aside for their subclass equal to their proportion of their compensable recovery quantity in the subclass. If the settlement is ultimately approved by the court, it may be more than a year before payments are issued. The settlement requires Syngenta, however, to pay all money into the settlement fund by April 1, 2019 or 30 days after final approval of the settlement, which is later. Corn producers and eligible landlords should watch for their notice to arrive shortly after May 11, 2018. They can begin filing claims on that date. www.cornseedsettlement.com will allow online filing at that time.
We will keep you posted!
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