When lawsuits filed against Monsanto Company (“Monsanto”) and BASF Corporation (“BASF”) for allegedly causing dicamba-related injury to farmers were consolidated into the multidistrict case known as in In re: Dicamba Herbicides Litigation, No. 1:18-md-02820 (E.D. Mo. 2019), the multiple claims were divided into two general categories. That resulted in the filing of two separate complaints. The Crop Damage Class Action Master Complaint (“Crop Damage Master Complaint”) was filed on behalf of plaintiff farmers who did not plant dicamba-tolerant seeds or spray dicamba-based herbicides, but suffered dicamba-related crop damage from spraying done by third parties. The Master Antitrust Action Complaint (“Master Antitrust Complaint”) was filed on behalf of plaintiff farmers who were direct purchasers of Monsanto’s dicamba-tolerant soybeans. They claim to have been injured by Monsanto’s alleged monopoly in the dicamba-tolerant traits market. The plaintiffs in the Antitrust Master Complaint brought three claims against Monsanto for alleged violations of the Sherman Antitrust Act (“Sherman Act”).
The Sherman Act is a federal statute that prohibits efforts to monopolize marketplaces or restrict interstate commerce. In the Master Antitrust Complaint, the plaintiffs brought their claims under Section 2 of the Sherman Act. That particular section of the Act prohibits any attempt to monopolize interstate trade or commerce, going so far as to make the act a felony.
The plaintiffs brought three claims against Monsanto for violating Section 2 of the Sherman Act. First, the plaintiffs raised the claim of Monopoly. Under that claim, the plaintiffs alleged that Monsanto possessed monopoly power of herbicide-tolerant traits in soybeans, and that Monsanto used that power to suppress competition in the herbicide-tolerant market. Second, the plaintiffs raised the claim of Attempt to Monopolize. Under that claim, the plaintiffs alleged that Monsanto acted with the intent to create and maintain a monopoly of the herbicide-tolerant market. Finally, the plaintiffs raised a claim of Combination, Contract, or Conspiracy to Monopolize. Under that claim, the plaintiffs alleged that Monsanto and BASF collaborated to engage in a conspiracy to monopolize Monsanto’s herbicide-tolerant traits by making an agreement for BASF to sell dicamba-based herbicides while Monsanto sold dicamba-tolerant soybean seeds.
Monsanto asked the court to dismiss all three of the plaintiffs’ claims against it. The company made three arguments in support of dismissal: (1) the plaintiffs lacked standing to bring a claim under the Sherman Act because they were not “direct purchasers”; (2) the plaintiffs failed to allege a plausible antitrust violation; and (3) the plaintiffs failed to adequately plead willfulness, specific intent to monopolize, and conspiracy. The court agreed with Monsanto that the plaintiffs lacked standing to bring claims under the Sherman Act, and therefore dismissed the complaint. However, the dismissal was without prejudice, meaning that the plaintiffs could bring their antitrust claims against Monsanto again provided that they fixed the standing issue.
When a plaintiff brings a claim into court they must have what is known as “standing.” A person has standing to bring their claim if they can show that they have suffered an injury to their own legal interests, and that the court has the authority to provide a remedy for that injury. Monsanto argued that to have the necessary standing to bring a claim under the Sherman Act, a plaintiff must be a “direct purchaser” from the alleged monopoly supplier. In other words, Monsanto argued for the plaintiffs to have standing to bring a claim under the Sherman Act, they had to show that they directly purchased their dicamba-tolerant soybeans from Monsanto. To support its argument, Monsanto relied on other court cases that had concluded that only plaintiffs who had made direct purchases from the alleged monopoly supplier had standing to bring Sherman Act claims.
The court agreed with Monsanto, and found that the plaintiffs had failed to show that they had made direct purchases of dicamba-tolerant soybeans from the company. The court noted that not only had the plaintiffs not alleged that they purchased the dicamba-tolerant soybean seeds directly from Monsanto, none of the plaintiffs had identified where they purchased their seeds. Instead the plaintiffs alleged that they had entered into a licensing agreement with Monsanto to use the dicamba-tolerant trait technology as a part of the overall seed purchase. According to the court, this was not enough for the plaintiffs to bring Sherman Act claims against Monsanto because the seeds themselves were still purchased through a third party. It is common practice for farmers to purchase seeds through a third party such as an independent seed dealer, rather than directly from Monsanto. However, to successfully raise a claim under the Sherman Act, the plaintiff needs to have directly purchased from the defendant. Because the plaintiffs in this case could not establish a direct purchase connection between themselves and Monsanto, the court concluded that the plaintiffs lacked standing to bring Sherman Act claims and dismissed the Master Antitrust Complaint.
Because the Master Antitrust Complaint has been dismissed, it will not be progressing to the trial stage of the In re: Dicamba litigation.
To read the Master Antitrust Complaint, click here.
To read the court’s opinion on motions to dismiss in In re: Dicamba, click here.
To read the text of the Sherman Act, click here.
To read the previous article in this series involving claims for trespass and nuisance, click here.
To read the first article in this series providing an overview of lawsuits concerning dicamba, click here.