Court Throws Out Potash Price-Fixing Lawsuit

A federal appeals court on Friday threw out a lawsuit brought by purchasers of potash who accused seven major producers of running a global conspiracy to raise the price of the mineral, which is used mainly in fertilizer.

Reversing a lower court order, the 7th Circuit Court of Appeals in Chicago said the purchasers failed to show a plausible “direct, substantial and reasonably foreseeable” link between the alleged foreign anti-competitive conduct and a 600 percent surge in U.S. potash prices from 2003 to 2008.

The appeals court directed the dismissal of claims alleging violations of the Sherman Act, a U.S. antitrust law.

Defendants included Canada’s Agrium Inc and Potash Corp of Saskatchewan Inc, Minnesota-based Mosaic Co , and four companies from Russia and Belarus: JSC Uralkali , JSC Silvinit, JSC Belarusian Potash and JSC International Potash. They accounted for about 71 percent of global potash supply when the case was brought in 2008.

The plaintiffs included Minn-Chem Inc and Kraft Chemical Co, as well as several individuals.

Potash is a key crop nutrient used by farmers worldwide and is also used to make animal feed supplements, glass and soaps. The worldwide market for potash may total $25 billion to $30 billion in 2011, according to industry experts.

“We were very pleased by the decision, which calls for a complete dismissal,” said Stephen Shapiro, a partner at Mayer Brown in Chicago who argued the case for the potash companies. “The court decided that the law requires dismissal because the complaint failed to allege any substantial or direct connection between the alleged conduct and the United States.”

Bruce Simon, a partner at Pearson, Simon, Warshaw & Penny in San Francisco who argued the case for the purchasers, said his clients are evaluating their options.

Overseas Conduct

The purchasers accused the potash companies of conspiring since 2003 to artificially restrict output and boost prices, citing “parallel” business conduct in Brazil, China and India.

They said the conspiracy contributed to the 600 percent surge in prices, following years of relative stability.

The defendants countered that U.S. courts did not have jurisdiction in an alleged offshore pricing conspiracy, and that any similarities in their conduct were coincidental.

U.S. District Judge Ruben Castillo in November 2009 allowed the case to continue, saying the allegation of a conspiracy was plausible. He then certified his order for immediate appeal.

Writing for the 7th Circuit, Judge Diane Sykes said the lawsuit offered “very little of substance” to show a link between alleged overseas price-fixing and U.S. potash prices.

“Contrary to what the district court seemed to think, it is not enough that the defendants are engaged in the U.S. import market,” Sykes wrote.

“The complaint does not allege that the defendants agreed to worldwide production quotas or a global cartel price, nor are there allegations that the defendants ever imposed a price or supply quota on the American potash market specifically.”

Demand for potash is expected to total between 55 million and 60 million tons in 2011, and the average price is now just below $500 a ton, industry experts said.

Judge Daniel Manion joined Sykes’ opinion. A third judge who had been on their panel, Terence Evans, died last month.

The case is Minn-Chem Inc et al v. Agrium Inc et al, 7th U.S. Circuit Court of Appeals, No. 10-1712.

(Source: Chicago Tribune)

Leave a Reply

Legislation Stories

FertilizerTFI Weighs In On Fertilizer Rail Transport Bill
May 14, 2015
With today’s House Committee on Transportation and Infrastructure as a backdrop, The Fertilizer Institute (TFI) registered its support for policies Read More
LegislationGov. Kasich Signs Ohio Bill For Lake Erie Water Quality
April 2, 2015
Gov. John Kasich has signed a bill aimed at protecting Lake Erie and Ohio’s water quality, reports editorial staff at Read More
Lake Erie Nutrient Stewardship
LegislationOhio Lawmakers Finalize Phosphorus Restrictions
March 25, 2015
State lawmakers on Wednesday finalized new rules designed to curb toxic algal blooms on Lake Erie, calling the regulations a major step forward in addressing the problem. Read More
Crop Protection Bulk Storage
LegislationARA: Chemical Security, Biotech Labeling Among Key Issues In 2015
February 12, 2015
The Agricultural Retailers Association is hopeful Beltway gridlock will lessen in 2015, allowing some key agricultural initiatives to gain legislative ground. Read More
Top 100 Articles
CropLife 100Pinnacle Purchases California-Based Specialty Crops Retailer
July 20, 2015
Pinnacle Agriculture Holdings has successfully acquired California-based NH3 Service Co.  Operating as part of Pinnacle’s Performance Agriculture brand, the new locations Read More
Asmus Farm Supply liquid fertilizer facility features 20,000 square feet
CropLife 100Slideshow: Asmus Farm Supply Shows Off Its New Liquid Fertilizer Facility
July 15, 2015
Asmus Farm Supply, Rake, IA, recently added a new liquid fertilizer facility to its company operations. The new liquid fertilizer Read More
CropLife 100Wilbur-Ellis Feed Division Facilities Receive Safe Feed/Safe Food Certification
July 13, 2015
Wilbur-Ellis Co.’s Feed Division, a marketer and distributor of value-added feed ingredients for the aquaculture, livestock and pet food industries Read More
CropLife 100BRANDT Expands To Brazil With Acquisition
July 8, 2015
BRANDT has acquired a majority interest in Target Brasil Fertilizantes Ltda. through its Brazilian subsidiary. Target Brasil manufactures, distributes and Read More
Milan Kucerak, president/CEO, West Central
CropLife 100West Central Cooperative And Its New President Are A Match Made In Deviation
June 29, 2015
To appreciate just how unique West Central Cooperative is in the world of ag retail, an observer need only consider Read More
Winter Wheat
CropLife 100South Dakota Co-op Member Owners Vote No On Unification
June 26, 2015
The Boards of Directors for North Central Farmers Elevator (NCFE) and Wheat Growers (WG) have announced that member-owners have voted Read More
Latest News
ManagementTechnology and agriculture: a Futurist’s Perspective
July 30, 2015
Futurist David Zach, speaking at this week’s InfoAg Conference in St. Louis, shared thoughts on the benefits and limitations of Read More
Biofuels Plant in Lousiana
Industry NewsIdle Biofuels Plant In Louisiana To Reopen As Ammonia F…
July 30, 2015
A Lithuania-based company plans to spend $265 million to reopen an idle biofuels refinery in Grant Parish as an ammonia Read More
FFA at Monsanto Booth at the 2015 National Farm Machinery Show
Industry NewsFive Students Receive The 2015 Monty’s Plant Food Compa…
July 29, 2015
This fall, five college-bound students will have financial support through the Monty’s Plant Food Company FFA Scholarship. All five scholarship Read More
GYPSOIL Blendable Pellets
Crop InputsBeneficial Reuse Management Launches Pelletized Gypsum …
July 29, 2015
Beneficial Reuse Management (BRM) announced this week at Ag Media Summit that its GYPSOIL Pelletized Products Division will open a Read More
StewardshipOhio Water Quality Project To Determine How Much Phosph…
July 27, 2015
Researchers with the College of Food, Agricultural, and Environmental Sciences at The Ohio State University are looking for farmers in Read More
FertilizerKoch Agronomic Services Launches N-TEGRATION Technology
July 27, 2015
Koch Agronomic Services, LLC (KAS) has launched  N-TEGRATION Technology, a process technology platform designed to enable production of enhanced efficiency fertilizers at Read More
HerbicidesExpert: IARC Herbicide Classifications Leading To Confu…
July 24, 2015
Few people in the crop protection industry had heard of the International Agency for Research on Cancer (IARC) before this Read More
ManagementFCI Trade Summit Update & Precision Tank Turns 50
July 23, 2015
Editors Dave Frabotta and Eric Sfiligoj discuss the upcoming FCI Trade Summit in Las Vegas, NV, and how Precision Tank Read More
Palmer pigweed seedhead in cotton
HerbicidesUSDA Deregulates Dow AgroSciences’ Enlist Cotton Trait
July 23, 2015
The USDA today issued its decision deregulating Dow AgroSciences’ Enlist cotton trait in the U.S. The USDA has now completed its Read More
Industry NewsVerdesian Life Sciences Showcases Versatile Product Por…
July 23, 2015
Technology has revolutionized agriculture by bringing farmers, retailers and distributors to the forefront of the digital age. To meet the Read More
FertilizerWSJ: Cf Industries Exploring Merger With Dutch Chemical…
July 23, 2015
U.S. fertilizer maker CF Industries is in advanced merger talks with Amsterdam-listed chemical company OCI NV, the Wall Street Journal Read More
HerbicidesNufarm Releases New Panther SC Herbicide
July 23, 2015
Nufarm has announced the availability of new Panther SC herbicide. Panther SC is the first liquid formulation of flumioxazin available Read More
EquipmentFarmLink Launches Farm Equipment Sharing Program
July 23, 2015
FarmLink has introduced a new online farm equipment sharing community – MachineryLink Sharing – leveraging this new economy business model Read More
HerbicidesCould The South’s Most Troublesome Weed Represent A Thr…
July 22, 2015
Palmer amaranth is undoubtedly the most troublesome weed in the southern United States, taking a devastating toll on both cotton Read More
Industry NewsH.J. Baker Hires New Director Of International Sales
July 22, 2015
Global Agriculture firm H.J. Baker announced today that Steve Langley has joined the company’s Crop Performance Division and Animal Health Read More
InsecticidesSyngenta Recommends Soybean Scouting To Prevent Economi…
July 22, 2015
Proper soybean insect pest control begins with scouting. As the warm weather continues, Syngenta encourages growers to implement a scouting Read More
Crop InputsH.J. Baker Launches Fall Sulphur Campaign
July 22, 2015
H.J. Baker has launched their “Keep Your Future Green – Use Tiger This Fall and Win Big” campaign. The campaign Read More
Central Valley Ag Randolph, NE
Retail FacilitiesStueve Construction Builds Fifth Facility For Central V…
July 21, 2015
Central Valley Ag partnered with Stueve Construction Co. to successfully design and build its Monroe, Oakland, Wakefield and Royal hub facilities Read More