DuPont de Nemours Pays $35 Million to Resolve U.S. Antitrust Allegations Over Pesticides

According to the terms of the settlement agreement, Corteva must dismantle its existing agribusiness dealer loyalty program. Regulators accused the mechanism of using rebate incentives to restrict dealers from purchasing cheaper generic agrichemicals after the company's related agrichemical patents expired, blocking generic competitors from entering the market and indirectly driving up the agricultural input procurement costs of U.S. farmers.

Under the consent order drafted by the court, Corteva will be prohibited from providing rebates and benefits to dealers to the next 10 years in exchange to dealers maintaining a high proportion of purchases from Corteva or restricting purchases of generic competitor items. The ban covers all patented agrichemical active ingredients of Corteva, and its scope exceeds the three representative agrichemical components listed in the initial indictment.

David Shaw, Principal Deputy Director of the FTC's Bureau of Competition, said: "This settlement puts an end to unfair business practices that harm farmers and removes barriers to the sale of low-cost agrichemicals. The agreement secured by the FTC and the states will give farmers access to greater cost-efficiently agrichemical options and ensure U.S. food security."

The lawsuit was first filed in September 2022, when the FTC joined forces with state attorneys general to sue Corteva and Syngenta, accusing the two companies of implementing a "pay-to-block" model, paying dealers to squeeze out cheap generic agrichemicals and forcing U.S. farmers to pay exorbitant costs to crop protection items.

Notably, this settlement only resolves all claims against Corteva, and the relevant judicial proceedings against Syngenta are still ongoing and no settlement has been reached. The 12 states participating in this settlement include California, Colorado, Illinois, Indiana, Iowa, Minnesota, Nebraska, Oregon, Tennessee, Texas, Washington and Wisconsin, and the $35 million settlement fund will be allocated to these states.

The FTC stated that after the settlement takes effect, generic agrichemicals will gain smoother distribution channels, which is expected to ease the long-standing pressure of high agrichemical prices faced by U.S. farmers. The proposed consent order still awaits final approval and entry into force by the U.S. District Court to the Northern District of North Carolina.