Grabar Law Office is investigating claims on behalf of farmers against the Syngenta Crop Protection AG, Syngenta Corporation, and Syngenta Crop Protection, LLC (collectively, “Syngenta”), and Corteva, Inc. (“Corteva”) (collectively with Syngenta, “Defendants”), that Defendants have implemented special “loyalty programs” in connection with key active ingredients that are incorporated into pesticides with the intent and outcome to stifle competition and maintain artificially high prices for these products.

On September 29, 2022, following an investigation, the Federal Trade Commission filed a complaint against Syngenta and Corteva (“Defendants”) alleging that Defendants’ loyalty programs foreclose generic competition for pesticides which result in higher prices for farmers in violation of federal and state antitrust laws.

As alleged by the FTC and ten state Attorneys General, In order to obtain Defendants’ loyalty payments, distributors severely curtail sales of, and in some cases wholly refrain from selling, pesticides that compete with those manufactured by Defendants. Without these distributors, competing manufacturers cannot effectively sell their pesticides and farmers are forced to purchase Defendants’ higher-priced products. As a result, farmers face decreased innovation, fewer choices, and increased prices totaling many millions of dollars in overcharges.

Each year more than 1 billion pounds of pesticides are used in the United States, costing approximately $10 billion per year.  Syngenta and Corteva are two of the largest pesticide manufacturers in the United States and globally. In 2021, Syngenta’s worldwide pesticide sales were approximately $13.5 billion.  Corteva’s were $7.3 billion.

As revealed by the FTC’s investigation, Defendants’ loyalty programs provide that Defendants will make payments in the form of “rebates” to distributors based on their purchases of Defendant-branded pesticides—but there is a condition: distributors and retailers must limit their purchases of generic pesticides to a set percentage. Defendants both reward participation in their loyalty programs and punish non-compliance. Indeed, Defendants ensure that Distributors profit more from accepting Defendants’ “rebates” payments than they would from distributing a higher volume of lower-priced, generic pesticides.

A copy of the FTC complaint can be viewed here: FTC - Syngenta Complaint

Only a small number of distributors dominate the sale of pesticides in the United States. Since they profit from participating in Defendants’ loyalty programs and face significant financial consequences if they do not, these distributors readily exclude generic pesticides from their distribution lists. As a result, generic competitors are almost entirely foreclosed from efficiently distributing their products. Prices remain high and farmers pay millions of dollars more than they otherwise would have for pesticides containing Defendants’ ingredients. Defendants, on the other hand, are able to maintain high prices and dominant market positions years after their exclusivity expires. While Defendants and their distributors benefit, farmers are left to pay supracompetitive prices for pesticides and are deprived of access to cheaper generic alternatives.

As a result of Defendants’ conduct, Defendants have restrained competition, maintained unlawful monopolies, and harmed America’s farmers, reducing choices for these farmers and costing them millions of dollars in overcharges.

Syngenta’s loyalty program applies to at least three active ingredients that are threatened by generic competition: azoxystrobin, mesotrione, and metolachlor.

Corteva’s loyalty program applies to at least three active ingredients: rimsulfuron, oxamyl, and acetochlor.

If you have purchased pesticides in the United States containing the active ingredients azoxystrobin, mesotrione, metolachlor, rimsulfuron, oxamyl, or acetochlor since January 1, 2017, you may have been overcharged, and could be eligible to bring a claim to receive a return of overcharges as well as potentially a court approved incentive award if appropriate.

If you would like to learn more about this matter at no cost to you, contact us at jgrabar@grabarlaw.com or call 267-507-6085.