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

Werner Baumann, Bayer AG, and Hugh Grant, Monsanto
Industry NewsReport: Monsanto, Bayer CEOs Among Latest to Make Trump Tower Pilgrimage
January 18, 2017
The chief executive officers of German chemical giant Bayer AG and U.S. seed behemoth Monsanto, Werner Baumann and Hugh Grant, Read More
Crop InputsARA 2016: 5 Developments Worth Monitoring Into 2017
December 6, 2016
You can pretty much set your watch to it (do people even still wear watches? I know I do…but I’m Read More
Pipe rack
LegislationCourt Sides With Ag Retailers On PSM
September 23, 2016
The D.C. Court of Appeals has ruled the Occupational Safety and Health Administration violated the Occupational Safety and Health Act when Read More
Soybean Plant closeup
LegislationOhio Soybean Association Names Pat Tiberi Legislator Of The Year
August 3, 2016
The Ohio Soybean Association (OSA) has announced that Congressman Pat Tiberi (R-OH) has been named one of two Legislators of Read More
Trending Articles
AgriSync
Matt Hopkins17 Agriculture Apps That Will Help You Farm Smarter In 2017
December 9, 2016
Ag professionals are working smarter, not harder, than ever before. Smart farming technologies have enabled them to reduce costs, maximize Read More
R4023 Sprayer, John Deere
CropLife 100Ag Retail Equipment Report: The Green Party Continues
December 7, 2016
In the annual race for sales in the ag retail equipment marketplace, the color schemes for participants are a little Read More
Mike Stern
Precision AgClimate Corp. CEO Talks Retailer Support For Digital Ag
December 1, 2016
CropLife Magazine’s sister publication, AgriBusiness Global, recently sat down with Mike Stern, CEO of The Climate Corp., following the Monsanto subsidiary’s Read More
Precision AgTrimble Debuts End-to-End FMIS Platform
November 28, 2016
October’s inaugural PrecisionAg Vision Conference left this author with many thoughts and things to ponder in the coming months. Probably Read More
CHS Primeland
CropLife 100The 2016 CropLife 100 Report: Reviewing The Many Bulls And Bears Impacting This Year’s Marketplace
November 28, 2016
For virtually all of 2016, the nation was wholly focused on the big Presidential election. Some folks aligned themselves with Read More
Monsanto sign
Crop InputsMissouri Governor Meets With Bayer CEO To Discuss Monsanto Merger
November 21, 2016
Missouri Gov. Jay Nixon visited Bayer AG global headquarters in Leverkusen, Germany, on November 18 to discuss the proposed Bayer-Monsanto Read More
Latest News
ManagementPresident Trump, Wisconsin Review, and a Dow-DuPont Upd…
January 18, 2017
Editors Paul Schrimpf and Eric Sfiligoj reflect on a new administration, a recent winter show, and crop protection company mergers. Read More
Industry NewsBayer, MS Technologies Get China Approval For Balance G…
January 18, 2017
MS Technologies and Bayer have received import approval from China for Balance GT soybeans. The new Balance GT Soybean Performance Read More
Werner Baumann, Bayer AG, and Hugh Grant, Monsanto
Industry NewsReport: Monsanto, Bayer CEOs Among Latest to Make Trump…
January 18, 2017
The chief executive officers of German chemical giant Bayer AG and U.S. seed behemoth Monsanto, Werner Baumann and Hugh Grant, Read More
Giant Ragweed
HerbicidesStudy: Focusing On Weed Seedbank Can Help Manage Herbic…
January 18, 2017
Researchers writing in the latest issue of the journal Weed Science provide important insights on the control of herbicide-resistant giant Read More
Management3 Financial Trends To Watch In Agriculture
January 17, 2017
I recently had the opportunity to attend a meeting of credit managers for Midwest ag supply and input companies, in part Read More
Andersons Retail Store
CropLife 100The Andersons To Close All Retail Stores; Shutdown Does…
January 16, 2017
In a stunning announcement to the Toledo area, The Andersons Inc. said on Sunday that it would close its two Read More
Trimble TMX-2050 In-Cab Display
Eric SfiligojPrecision To Lead Agriculture In 2017?
January 16, 2017
Another new year is upon us! And I’m certain I speak for many in the agricultural world when I say Read More
Corn
Eric SfiligojThe Mood From Madison? In A Holding Pattern
January 16, 2017
Last week, I had the chance to attend the annual Wisconsin AgriBusiness Classic show in Madison, WI. It’s been a Read More
Syngenta Sign
Crop InputsAccenture Helps Syngenta Transform Its Global Logistics
January 13, 2017
Syngenta, a leading agriculture company, has collaborated with Accenture to design and implement a new digital logistics operating model across Read More
Fall Creek Seth Harden The Nature Conservancy
StewardshipLocal Farmers’ Watershed Initiative: Continuous Improve…
January 13, 2017
The goal in the Big Pine Watershed Project is to more intentionally do what local farmers and responsible ag retailers Read More
HerbicidesEPA Expands Enlist Duo Herbicide Registration To 34 Sta…
January 13, 2017
The U.S. EPA has expanded the geography for application of Enlist Duo herbicide from 15 to 34 states. This means Read More
Olson Ag Enterprise
CropLife 100Wilbur-Ellis Acquires Nebraska Seed Retailer
January 13, 2017
Wilbur-Ellis’ Agribusiness, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed and nutritional Read More
ManagementDeere-Precision Planting Update and the Ag Secretary Wa…
January 12, 2017
Editors Paul Schrimpf and Eric Sfiligoj provide the latest on the court date for John Deere/Precision Planting and the quest Read More
Monsanto sign
Seed/BiotechMonsanto, NRGene Form Agreement For Big Data Genomic An…
January 12, 2017
Monsanto Co. and NRGene have announced that the companies have reached a non-exclusive, multi-year global licensing agreement on NRGene’s genome-analysis Read More
AGCO Custom applicator
SprayersAGCO, Asmark Institute To Offer Training For Beginning …
January 11, 2017
AGCO Corp. and the Asmark Institute are collaborating to offer a new training program dedicated to educating and developing custom Read More
ManagementAg Land Values In Limbo In 2017
January 10, 2017
Several factors will come into play in 2017 that will determine the direction of land values. Randy Dickhut, senior vice Read More
Industry NewsPattison Agriculture Positioned To Be Leading Canadian …
January 10, 2017
Pattison Agriculture Limited (Pattison Agriculture), a division of The Jim Pattison Group (the Pattison Group), has announced the merger of Read More
Fertilizer Tender close-up
MicronutrientsHow Micronutrients Fit Into 2017 Fertility Plans
January 10, 2017
Where do micronutrients stand going forward in fertility plans? For one thing, Tim Mundorf, Field Representative with Midwest Laboratories, says Read More