Potash producers PotashCorp, Mosaic Co. and Agrium have settled U.S. antitrust lawsuits that accused them of artificially inflating potash prices.
PotashCorp and Mosaic paid $43.75 million each while Agrium paid $10 million to settle the cases brought by U.S. buyers in 2008, the companies said in separate statements on Wednesday (all figures US$).
Russian group JSC Uralkali, the world’s second-largest potash producer by capacity after Canada’s PotashCorp, agreed in September to settle the cases by paying $12.75 million.
Three more companies from Russia and Belarus — JSC Silvinit, JSC International Potash and JSC Belarusian Potash — were also named in the lawsuits in 2008. Uralkali and Silvinit merged in 2011.
The companies named in the lawsuits accounted for about 71 per cent of global potash supply in 2008. The United States consumed 6.2 million tons of potash that year, of which 5.3 million was imported.
The settlement is subject to final approval of the U.S. District Court for the Northern District of Illinois.
Saskatoon-based PotashCorp said it decided to settle after weighing the multi-year financial cost required to defend the allegations.
"These allegations are completely without merit and we deny all of the claims asserted in the lawsuit," CEO Bill Doyle said in a statement.
The settlement, he said, is an example of the "abuse of class actions in the United States" where self-interested lawyers enlist nominal plaintiffs to press "meritless claims."
Steven Hart, one of the lawyers for direct purchaser plaintiffs such as small companies and farmers, said he was disturbed by Doyle’s comment.
"We feel they were reckless comments and inappropriate," Hart said. "Obviously this was a legitimate case… It is inappropriate and self-serving to suggest that this claim was without merit."
Calgary-based Agrium said in a separate statement it and the other defendants "deny all allegations of wrongdoing, liability, or damage to any of the plaintiffs or putative classes in the action, deny that they engaged in any violation of law or breach of duty, and believe they acted properly at all times."
Mosaic, headquartered at Minneapolis, added it "chose to settle these claims to avoid the significant costs, burden and distraction of protracted litigation."
— Shounak Dasgupta and Rod Nickel are Reuters correspondents in Bangalore and Winnipeg respectively. Includes files from AGCanada.com staff.