CHICAGO – Attorney General Kwame Raoul, as part of coalition of 12 attorneys general, and the Federal Trade Commission today announced they have secured a $35 million proposed settlement with pesticide manufacturing giant Corteva Inc. that will lead to lower pesticide prices for farmers in Illinois and across the country.
Under the terms of the settlement, Corteva will dismantle its existing pesticides loyalty program, which has limited distributors’ ability to do business with generic competitors that seek to enter the market after Corteva patents have expired. Raoul and the coalition’s settlement agreement will provide relief to farmers who have long endured high pesticide prices by ensuring greater access to lower-cost generic pesticide products.
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“In Illinois we rely on our farmers to feed families and drive our agricultural economy, so farmers should not have to overpay for the products they need to protect their crops,” Raoul said. “I am proud of our coalition’s work in protecting farmers’ access to affordable options and preventing anticompetitive practices.”
“This settlement will do away with unfair corporate practices that have hurt farmers by impeding the sales of lower priced products,” said FTC Bureau of Competition Principal Deputy Director David Shaw. “The agreement the FTC and its state partners secured will give farmers better pesticide options at lower prices, enabling farmers to continue to put food on Americans’ tables.”
Raoul said for a period of 10 years, the proposed order will prohibit Corteva from conditioning payments or other benefits to a distributor on that entity purchasing a high share of a given pesticide active ingredient from Corteva or similarly limiting its purchases of generic equivalents.
The settlement reached with Corteva resolves a 2022 lawsuit that alleges Corteva implemented a post-patent loyalty program that paid distributors to block competitors from selling its cheaper generic products to farmers. According to Raoul and the coalition’s complaint, this conduct allowed Corteva to maintain elevated prices, forcing American farmers to spend millions of dollars more for essential crop protection products. The complaint made similar allegations against Syngenta, another pesticide manufacturing giant, and its post-patent loyalty program.
The settlement with Corteva builds on recent actions, including a landmark settlement with agricultural equipment maker Deere & Company, to lower the cost of living for all Americans, including farmers and consumers.
The proposed settlement agreement will end Corteva’s alleged exclusionary conduct that has raised pesticide prices for farmers. For 10 years, Corteva is prohibited from:
- Implementing loyalty programs that condition payments to a Corteva distributor customer on the customer purchasing a greater than 50% share of its requirements of a given pesticide with an active ingredient from Corteva.
- Implementing share-based programs that limit the share of a generic product that a distributor customer may purchase to under 50% (or the volume equivalent).
- Implementing a volume-based loyalty program for the purpose of replicating or reintroducing a prohibited share-based loyalty program.
- Implementing other specified conditions that enhanced the exclusionary effect of Corteva’s prohibited loyalty program on generic competitors.
- Discriminating against or threatening customers because they refuse to agree to prohibited exclusive or loyalty terms, or because they conduct business with Corteva’s competitors, including generic manufacturers.
The proposed order applies to all Corteva’s post-patent active ingredients, extending beyond the three exemplar active ingredients named in the complaint.
Joining Raoul and the FTC in this settlement are the attorneys general California, Colorado, Indiana, Iowa, Minnesota, Nebraska, Oregon, Tennessee, Texas, Washington and Wisconsin.
