Overview of Syngenta Litigation

Rincker Law Food & Ag Law Leave a Comment

iStock_000017345908SmallOne of the most important questions that corn producers are asking themselves lately is whether or not to join in a class action lawsuit against Syngenta for being responsible for the drop in the market price of corn in 2013. The litigation arose when Syngenta manufactured a genetically modified seed containing the MIR 162 trait for corn.

At that time, the GMO was approved by the United States government, but had not yet been approved by the Chinese government, a major import of United States corn. In 2013 when China received shipment of corn from the United States containing this trait that they had not yet approved, they rejected the shipment and multiple other shipments, which China suspected of having the same trait. This rejection by China led to a drop in the demand of corn in the United States and a decrease in the market price of all corn regardless of whether or not the seeds used came from Syngenta.

Economists approximate that this allegedly caused a loss of somewhere between $1 billion and $2.9 billion for US farmers and corn producers. Multiple lawsuits have been filed against Syngenta in both state and federal courts, but the biggest one is currently in the District Court of Kansas. This lawsuit, with farmer Plaintiffs from eleven states, alleges that Syngenta had a duty of care in respect to the selling of the genetically modified seeds to corn producers and that Syngenta breached this duty when it led buyers of the seed to believe that this GMO had been approved by China.

In June of 2015, Syngenta filed a motion to dismiss this lawsuit stating that Syngenta has no control over how third-parties used its seeds and that the third party use resulted in the contamination of the corn supply chain, not Syngenta’s own activities. In September of 2015, the District Court judge ruled against Syngenta’s motion to dismiss and allowed the litigation to continue. The Court held that the corn producers were using the seeds in the method that was intended and Syngenta as a manufacturer has a duty to “exercise reasonable care not to commercialize and sell its product in a way that creates a risk of widespread harm resulting from the intended use of the product by all of its customers.”

The Court also stated that the risk of harm spread to “participants in an inter-connected market” where even those who had not used Syngenta’s seeds were affected by Syngenta’s failure to perform the reasonable care in commercializing its seeds. This declaration allows anyone in the corn business, including farmers and importers and exporters, to join in the litigation against Syngenta.

The next step in this class action suit now is to start discovery where Plaintiffs will start collecting information from farmers who were affected by Syngenta’s action. The Plaintiffs will also work on getting a class certified by the District Court. A class certification is one where the Court determines who will qualify as a Plaintiff in this case against Syngenta. Once the class is identified, more farmers and corn producers will be added to this litigation and many others.

For farmers that are considering joining as members of the class, there are many law firms that are ready to help you join. Most of these firms are offering free consultations and there is no upfront cost for farmers who do wish to join in the litigation. The firms involved in the litigation are prepared to pay for all costs for the lawsuit and will only be paid if they achieve a successful verdict or settlement.

However, the thing for farmers to consider is the amount of time that it will take in getting a result in this lawsuit. The legal process is often very slow and with a case where the Plaintiffs are an extremely large number it could take quite some time to reach a conclusion. Farmers also need to consider the financial information they will have to provide to the law firms in order to establish their case and how much they should recover if a favorable verdict or settlement occurs.

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