Iowa, Nebraska Attorney Generals join pesticide makers lawsuit

(Staff)
Published: Sep. 29, 2022 at 3:44 PM CDT
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SIOUX CITY (KTIV) - A vote by the Federal Trade Commission on Thursday, Sept. 29 has been joined by 10 states, including Iowa and Nebraska, in filing a lawsuit against pesticide makers Syngenta and Corteva, alleging anticompetitive practices that have harmed farmers.

The complaint, filed today in U.S. District Court in the Middle District of North Carolina, accuses the defendants of using “loyalty programs” with pesticide distributors to exclude generic competitors from the market.

The programs reward distributors for selling Syngenta and Corteva products long after their patent and other protections have expired, thus inflating prices.

“These unlawful business practices have cost farmers many millions of dollars a year,” the complaint alleges.

The lawsuit accuses Syngenta and Corteva of violating state and federal laws, including the FTC Act and the Clayton Act. The FTC and state attorneys general ask the court to end the loyalty programs, and grant equitable monetary relief and attorney fees, among other remedies. The relief would include restitution for farmers.

Syngenta, based in Basel, Switzerland, and a subsidiary of Sinochem Holdings Corp. of China, and Corteva, based in Indianapolis, are among the largest makers of crop-protection products in the United States. The companies’ products are used on a wide range of grains, vegetables, fruits, and other crops, helping improve yields and food security.

The complaint accuses Syngenta and Corteva of paying incentive payments, or “rebates,” to distributors on one condition: The distributor must keep its purchases of comparable generic products below a low threshold. Corteva and Syngenta have entered into loyalty-program agreements with substantially all leading distributors in the United States. In turn, the distributors sell the products containing the branded ingredients to retail outlets.

These loyalty programs enable the defendants to maintain high prices and dominant market positions years after exclusivity for an active ingredient has expired. They also have forced generic manufacturers out of the market, the lawsuit alleges.

In addition to Iowa and Nebraska, the lawsuit was joined by the attorneys general of California, Colorado, Illinois, Indiana, Minnesota, Oregon, Texas, and Wisconsin.