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Dennis VanDerGinst on KBUR AM radio talking about Corn Farmer Lawsuit against Syngenta

Click play below to listen to Dennis VanDerGinst being interviewed on KBUR AM radio with Steve Hexom about the Corn Farmer Lawsuit against Syngenta.

Who is Syngenta, the defendant in these GMO corn lawsuits?

  • Syngenta is the world’s largest seed supplier
  • Syngenta is based in Basel, Switzerland
  • It has a market capitalization in excess of $32 billion
  • It has three primary U.S. entities
    • Syngenta Produce US, LLC (Delaware)
    • Syngenta Crop Protection, LLC (North Carolina)
    • Syngenta Seeds, LLC (Minnesota)

Syngenta is a large multi-national corporation, with sales units integrated in (1) Europe, Africa and the Middle East; (2) North America; (3) Latin America; and (4) Asia Pacific. Syngenta’s 2013 Annual Report explains that “Syngenta’s largest market is Europe, Africa and the Middle East, which represented approximately 30 percent of consolidated sales in 2013 (2012: 30 percent) followed by North America and Latin America, each of which represented 28 percent
of consolidated sales in 2013 (2012: 30 percent and 26 percent, respectively). Markets for agricultural products in Europe, Africa and the Middle East and North America are seasonal resulting in both sales and operating profit for Syngenta in these markets being weighted towards the first half of the calendar year, which largely reflects the northern hemisphere planting and growing cycle. Latin America has its main selling season in the second half of the year due to its location in the southern hemisphere.”

Syngenta’s sales exceed $14 billion per year, with crop protection products selling at double the sales volume of its seed products. Syngenta’s crop protection products include selective herbicides, non-selective herbicides, fungicides, insecticides, seed care and other crop protection offerings. Its seed sales are comprised of primarily corn and soybeans, but also of diverse field crops and vegetables. It also sells lawn and garden products.

Syngenta’s Research and Development function employs nearly 5,500 people working at R&D centers and field stations around the world and has been organized to continue to develop quality Crop Protection and Seeds products, while enabling the development of crop-focused solutions which integrate Syngenta’s technologies. Underpinning Syngenta’s core Seeds R&D and Crop Protection R&D structure are global competency platforms that include biotechnology, regulatory, product safety, as well as a global trialing capability.

Syngenta self-insures or uses a combination of insurance and self- insurance for certain risks. Syngenta reported cash and cash equivalents on December 31, 2013 and 2012 of $902 million and $1,599 million, respectively. Of total cash and cash equivalents of $902 million (2012: $1,599 million), $153 million (2012: $125 million) is required to meet insurance solvency requirements of the Group’s insurance subsidiaries. In its 2013 Annual Report to its shareholders, Syngenta states, “Litigation is subject to many uncertainties, and the outcome of individual matters cannot be predicted with certainty. Syngenta maintains general liability insurance, including product liability insurance, covering claims on a worldwide basis with coverage limits and retention amounts which management believes to be adequate and appropriate in relation to Syngenta’s businesses and the risks to which it is subject.”

Syngenta is governed by its executive committee, chaired by Michael Mack, the CEO, and with member John Ramsay, the COO, and John Atkin, Robert Derendes, Caroline Luscombe, Christoph Mader, Mark Peaccok, Davor Pisk and Jonathan Seabrook.

Written by*:
Mikal C. Watts
WATTS GUERRA, LLP
Four Dominion Drive, Bldg. Three, Suite 100
San Antonio, Texas 78257

* This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.

Who can join this GMO corn lawsuit against Syngenta?

  • Corn Producers – Farmers and Landlords Leasing Their Farmland Who Lost Money from the Drop in Corn Prices
  • Non-Producers – Grain Elevators and Corn Exporters Who Lost Money from the Drop in Corn Prices
  • Both Can Claim Lost Income from the Drop in Corn Prices

  • Other Damages may include Storage Costs, Clean-Up Costs and Transport Costs

Thousands of individual farmers, landlords, grain elevators and corn exporters have filed suit against Syngenta, alleging that its actions caused the drop in corn prices and the consequent collective losses of billions of dollars. Who can join this lawsuit against Syngenta? In sum, the answer is anyone directly affected by the drop in corn prices that Syngenta caused.

First, farmers who produce corn sustained obvious damages in the form of reduced income when the price they received for the corn they produced dropped precipitously in 2013 and 2014. Claims are being made by such farmers for Syngenta’ role in the drop in corn prices from $7.00/bushel in June, 2013 to $3.25/bushel in June, 2014. Syngenta’s actions were one of the precipitating causes of this drop.
Second, landowners who lease their land to farmers have sustained damages as well. Specifically, a landlord leasing his or her farmland to a farmer in exchange for a percentage of the crop has been damaged in the same manner as the farmer they leased to. While a landlord being paid a straight cash rent is not injured if the farmer succeeded in paying the rent owed even with falling corn prices, oftentimes those same farmers seek a reduction in cash rent during the next crop year. If the rents paid then dropped because of a falling corn price caused by Syngenta’s conduct, the landlord has a claim for this lost rental income.

Third, grain elevator companies have claims in two instances. Initially, many grain elevators have seen their profit margins on bushels handled drop dramatically as a result of the disruption to the corn export market. Furthermore, other grain elevators that buy corn on futures contracts – so called “hedge” contracts – have directly lost money when they contractually obligated themselves to pay farmers a set price for all corn produced and were therefore forced to pay that set price even when the resale price for that corn fell below the price they paid for it.

Fourth, corn exporters have lost money by virtue of contractually obligating themselves to pay grain elevators for their corn at a predetermined price, and then being forced to continue to do so even when their ability to re-sell that corn at a higher price disappeared. Exporters such as Cargill, Trans Coastal Supply Company and Archer Daniels Midland have all filed lawsuits against Syngenta for their damages.

Typically, ethanol plants have not sustained damages from the drop in the price of corn, because this has resulted in a drop in their cost of supply. However, in limited circumstances, ethanol plants contractually obligate themselves to pay for corn at a predetermined price. When the market price of corn fell well below that predetermined hedge price, ethanol plants lost money in that instance.
In addition to economic losses attributed directly to the drop in corn prices, some farmers have sustained additional damages in the form of storage costs when they have held their corn in an effort to wait on prices rising again. Moreover, farmers that planted Syngenta’s genetically modified traits (known as MIR-162 (Viptera Agrisure) or Duracade Agrisure) have sustained additional damages in the form of the cost of cleaning up storage bins, harvesting equipment and transport vehicles, as well as the extra transport costs necessitated when corn grown was rejected by nearby grain elevators, and farmers were forced to haul it long distances for eventual sale.

Written by*:
Mikal C. Watts
WATTS GUERRA, LLP
Four Dominion Drive, Bldg. Three, Suite 100
San Antonio, Texas 78257

* This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.

What did Syngenta do to cause the drop in corn prices?

  • Syngenta Made Promises to the U.S. Government Which it Did Not Keep
  • Syngenta Failed to Timely Implement Stewardship Programs Necessary to Keep MIR 162 corn away from other Approved Corns
  • Syngenta Minimized its Problems Obtaining Regulatory Approval for MIR 162, and Suggested it Had Obtained Approval When it had Not
  • When the Chinese detected unapproved MIR 162 in export shipments from the U.S., China banned U.S. corn, sending its price from $7.00/bushel to @$3.25/bushel

Syngenta developed and patented a genetically-modified trait of corn known as “MIR 162.” Several of the export partners of the United States had not approved this trait at the time Syngenta sought permission to sell it in the United States in 2010. Before Syngenta could sell this trait in the U.S., it applied for “non-regulated status” from the United States Department of Agriculture. In its application, Syngenta promised the federal government that it (1) would implement and enforce mandatory stewardship programs that would keep MIR 162 corn separated from non-MIR 162 corn; and (2) would ensure that only regular corn would be “channeled” for distribution to export partners of the United States. Syngenta promised the U.S. Government that as a result, there would be no effect on the U.S. corn export market. The U.S. Government granted the requested “nonregulated status,” and Syngenta immediately began selling MIR 162 corn seed to farmers across the United States. The lawsuits filed against Syngenta allege that Syngenta violated these promises it made to the U.S. Government.

Syngenta took no meaningful actions to implement an effective stewardship program for MIR 162 corn. While it controlled how MIR 162 was dispersed through the U.S. corn market, its failure to implement timely these stewardship programs resulted in the MIR 162 corn trait being commingled with other approved corn seeds across the United States. The National Grain and Feed Association (“NGFA”) warned Syngenta twice that its failure to implement a stewardship program could result in the rejection of U.S. exports of corn by America’s major export partners. The NGFA predicted American corn farmers could lose corn income of up to $2.9 billion during crop year 2013 and up to $3.4 billion in crop year 2014 if Syngenta chose to continue selling MIR 162 before obtaining approval for U.S. corn export partners.

Even worse, Syngenta then minimized the risk of its failure to obtain regulatory approval for MIR 162 from America’s corn export partners. First, several former Syngenta seed salesman have shared stories of being instructed to tell farmers that there was “no problem,” that approval “was imminent,” and that farmers “didn’t need to worry about it.” Second, Syngenta caused farmers to believe that MIR 162 corn had received regulatory approval from China when, in fact, it had not. Syngenta posted on its website a document entitled a “Request Form for Biosafety Certificate(s) Issued by the Chinese Ministry of Agriculture,” and this document suggested that the Chinese had issued such approval certificate for MIR 162. This was not true. Third, on April 18, 2012, the Chief Executive Officer of Syngenta stated on a recorded call with the U.S. investment community that Syngenta expected approval from China “in a matter of a couple of days.” This statement was also false, as approval was not procured for another two and one-half years, on December 16, 2014.

Syngenta’s actions caused MIR 162 corn to be detected by Chinese regulators in U.S. corn export shipments, who first destroyed it, and later banned it. As a result, the price of corn fell from over $7.00/bushel in June, 2013 to $3.25/bushel by June, 2014, costing American corn farmers billions of dollars.

Written by*:
Mikal C. Watts
WATTS GUERRA, LLP
Four Dominion Drive, Bldg. Three, Suite 100
San Antonio, Texas 78257

* This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.

Why is it important that Syngenta pay for its actions that caused the drop in corn prices?

  • Farmers Lost Billions of Dollars; It is Right That They Should Recover their Losses
  • Filing Suit in Civil Actions is a Constitutionally Guaranteed Right
  • Syngenta Should Not Keep its Profits from Prematurely Marketing MIR 162 When Its Actions Cost U.S. Farmers Billions of Dollars
  • This Lawsuit Will Send a Message to Syngenta and Other Seed Companies That They Should Not Put Farmers at Risk in an Effort To Achieve Profits

U.S. corn farmers lost billions of dollars in 2013 and 2014 as a result of Syngenta’s premature commercialization of MIR 162, a genetically-modified corn trait not yet approved by all of our major export partners. These losses were foreseeable to Syngenta; in fact, the National Grain and Feed Association had twice warned Syngenta in advance that its actions could cause these losses to farmers. Despite knowing that its actions could cause an implosion of the U.S. corn export market, Syngenta took a risk on the backs of the American corn farmer. That risk blew up not in Syngenta’s face; it blew up the wallets of the American corn farmer. Given these facts, it is right and proper that farmers be permitted to recover their losses from a company that profited from its own misconduct.

The lawsuits being filed by farmers against Syngenta are filed pursuant to a constitutional right to a jury trial in civil cases contained within the Seventh Amendment of the United States Constitution. In fact, many of our forefathers, including Thomas Jefferson, refused to sign off on our constitution until this right was added to it within the Bill of Rights. This Seventh Amendment right should be just as dear to us as our right to free speech in the First Amendment and our right to bear arms in the Second Amendment. This constitutional right was tailor-made for citizens like American corn farmers to seek redress against companies like Syngenta before a jury of their peers.

In 2013, Syngenta achieved revenues from the sale of its corn products in an amount exceeding $3.5 billion. It is estimated that MIR 162 (“Viptera”) corn comprised approximately 25% of Syngenta’s corn sales that year. Syngenta prematurely commercialized MIR 162 and profited handsomely. Syngenta should not be allowed to keep its profits from prematurely marketing MIR 162, especially when its actions cost U.S. corn farmers billions of dollars.

One of the legitimate purposes of civil litigation is to dissuade companies from conducting their affairs like this. When Syngenta chose to take a risk on the backs of the American corn farmer, it did so intentionally. A decade ago, Bayer took similar risks with its new strain of genetically-modified corn. As a result, in four of six trials, juries assessed punitive damages against Bayer. This is just and right. This lawsuit will send a message both to Syngenta and to other seed companies that they should not put farmers at risk in an effort to achieve profits, and will go a long way to assuring that this conduct will never occur again.

Written by*:
Mikal C. Watts
WATTS GUERRA, LLP
Four Dominion Drive, Bldg. Three, Suite 100
San Antonio, Texas 78257

* This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.