US: Appeals court reinstates case against ADM
A US appeal court has reinstated the long-standing class action lawsuit brought by soft drink groups against the agribusiness group, Archer Daniels Midland Co. (ADM) for allegedly colluding to fix the price of high fructose corn syrup, used as a sweetener in the manufacturer of soft drinks.
This latest ruling effectively reverses a US District Court decision in July throwing out a 1995 lawsuit filed by Coca-Cola Co., PepsiCo Inc.and other companies which could lead to huge damages. In 1996, ADM pleaded guilty to two criminal charges of price-fixing and paid $100m in penalties.
"We hold only that there is sufficient admissible evidence in support of the hypothesis of a price-fixing conspiracy," wrote 7th Circuit Court of Appeals Judge Richard Posner. The other defendants in the case are A.E. Staley Manufacturing Co., now part of UK sugar group, Tate & Lyle, and American Maize Inc, now owned by the Minneapolis-based Cargill group.
Robert Kaplan, lead attorney for the plaintiffs in the sweetener case, said he would be seeking damages of $1.4 billion, an award which he said could be trebled to $4.2 billion under federal antitrust laws.
ADM said it had no comment and was reviewing the ruling but the Cargill group did comment on the case. "We respectfully disagree with the appellate panel's decision," said Cargill spokesperson, Bonnie Raquet. "We believe that the district court correctly analyzed the factual and legal issues under controlling precedent."
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