Update on Arkansas Supreme Court decision regarding punitive damages …

“The Arkansas Supreme Court has affirmed the trial court judgment, which was close to $50 million. That case was separate from the settlement we’ve been talking about.

“The trial court had found unconstitutional the state law that capped punitive damages to around $1 million. The state supreme court affirmed that and said ‘the trial court was right. This is unconstitutional.’ Therefore, the full punitive damages were awarded.

“In addition to the benefit that will provide to the Arkansas rice farmers in that case, there was also a second case where Riceland Foods sued Bayer. They received a $100 million-plus punitive damage judgment. So, that (supreme court ruling) was also good news for Riceland, as well.

“There are a lot of members of Riceland. This is great news for them.”

More on the claims process…

“Some of the submitted claims haven’t yet been certified as being complete. The claims administrator has gone through each claim and looked to see if all the I’s are dotted and T’s crossed. Are all the signatures on the releases at the right place? Has the right person signed them? Have they claimed the proper amount under the forms?

As you’d expect with such a high number, some of the claims were found to be deficient. Once a deficiency notice goes out, the claimant has 60 days to cure the deficiency.
“So, one of the reasons some of the claims haven’t been certified is they’re still going through the deficiency cure process.”

What is the actual number – either in farmer numbers of farming entities – filed?

“More than 10,000 farming entities submitted claims. But as you know, some farmers have multiple entities they farm through. So, it’s hard to boil it down to the exact number of farmers.”

On tax implications of the settlement funds…

“A lot of (rice farmers) have asked questions about when the money will reach them. For tax purposes, will it be 2011 income? Will it be 2012 income for tax purposes?

“Right now, it looks pretty clear based on the timing of everything that the money will not flow until January of 2012. Farmers should know that if they’re doing any tax planning.”