VeraSun Creditors Drop Corn Repayment Suit

Joanna Schroeder

Back in August, dozens of corn growers who sold corn to bankrupt VeraSun plants across the country in 2008 received letters asking them to repay the money. Should the farmer not comply, the letters threatened to take legal action but stipulated that they would accept payment to 80 percent of what the farmer received for their corn sales to VeraSun. The deadline for response was today and with the help of the National Corn Growers Association along with state corn groups, farmers were encouraged to tap into legal resources prior to responding.

Today, these same farmers received good news – attorneys are dropping their questionable claims for payment.

“This is great news for farmers at a time when we need to focus on bringing in our crops,” said National Corn Growers Association (NCGA) President Darrin Ihnen. “We’re glad the lawyers saw the light and realized they had no legal justification to go after us. We had an excellent team working on this to make sure we had the right information, and to present our case.”

NCGA explained that because of bankruptcy law, attorneys representing VeraSun creditors were able to seek repayment from farmers and others who received money from VeraSun within 90 days prior to the bankruptcy filing. Ironically, the farmers who were asked to repay the money were not “given back their corn”.

In strongly worded correspondence sent Tuesday to the law firms demanding payment, an attorney assisting NCGA insisted that the lawyers withdraw their demands.

“We believe that many of the foregoing demands were made without any legal and factual foundation and, as such, constitute an impermissible effort to collect alleged debts that are clearly not owing,” wrote attorney David Lander of Thompson Coburn. “They appear to have been made without the inquiry reasonable under the circumstances. Moreover, we believe that the claims asserted in the vast bulk of these letters are not warranted by existing law or a non-frivolous argument for the extension, modification or reversal of existing law or the establishment of new law.”

corn, Ethanol, NCGA