A global seed company won a ruling that claims involving defective seed were subject to mandatory arbitration, enabling the company to settle a matter related to corn seed on favorable terms.
The case involved claims that the company's corn seed purchased and planted by plaintiffs in 2010 was defective, resulting in the corn plants being more susceptible than expected to “green snap.” The plaintiffs initially filed the case in state court, asserting claims for breach of express warranty, breach of implied warranties and negligent misrepresentation.
With Faegre Baker Daniels serving as lead counsel, the seed company removed the case to federal court and immediately asked to dismiss or stay the case due to the plaintiff’s failure to submit the case to private arbitration in Polk County, Iowa, as required by the terms and conditions of sale stated on the bags of corn seed. The court permitted limited discovery on the issue of whether arbitration was required, and then, in a series of decisions, the court ordered that arbitration was required. The plaintiffs opted not to submit their claims to arbitration and the case was settled on terms very favorable to the client.