Delta farmers file suit after Missouri bank seizes harvest in grain elevator bankruptcy
A group of Mississippi Delta farmers is suing Missouri-based UMB Bank in federal court after the bank seized their fall harvests as collateral from Express Grain, a Greenwood grain elevator and biodiesel refinery.
The farmers, in a class action lawsuit, claim UMB Bank knew Express Grain was teetering on financial collapse and propped the company up through the fall soybean and corn harvest until it could fill its silos at the end of September.
Once the silos were full, the bank called the approximately $70 million in loans owed by Express Grain, forcing it to offer up the harvested grain as collateral, according to the complaint filed Nov. 8 in U.S. District Court.
The farmers claim they have not been paid for their harvests, and are suing to recoup their losses. It's typical for farmers not to be paid until after a grain elevator sells it on their behalf.
Don Barrett, a Lexington attorney representing the farmers, said he estimates the total figure of outstanding payment to be more than $100 million.
"They set a trap for these farmers and caught them," Barrett said.
The attorney for UMB Bank did not respond to a request for comment. Express Grain, through a spokesperson, also declined comment. UMB Bank has until Dec. 21 to file a response to the farmers' lawsuit.
The farmers cannot sue Express Grain for damages because the company filed for Chapter 11 bankruptcy in September, according to court records.
In its bankruptcy filing, Express Grain lists both assets and debts in between $50 and $100 million.
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The farmers claim Express Grain, by direction of UMB Bank, misled them about the financial footing of the company. The company hired salesmen to go across the Delta, pitching farmers to bring their harvests to Express Grain this season, Barrett said.
"It was an intensive marketing effort that the bank had to know about," he said.
In the spring, Express Grain President John Coleman touted the company's future and a $3 million facility upgrade in a Greenwood Commonwealth story where he said business had "grown every year."
Coleman did not respond to multiple requests for comment.
While just three farmers are named as plaintiffs in the class action complaint, Barrett said he represents at least 65 farmers who sold their harvest to Express Grain and weren't paid for it.
The missing money is taking an emotional toll on the farmers, some of whom have told Barrett they'd be ruined if they don't see some soon.
"Everything they’ve worked their lives for, this bank is attempting to take it away from them," he said. "I’ve had some clients talk about suicide. I’ve had several clients who’ve wept in my office."
The impact of farmers not being paid for a harvest season will be felt across the Delta, Barrett said.
"All these little Delta communities where people shop, their employees shop, everybody is going to be affected," he said. "I don’t mean made uncomfortable — but if this were allowed to stand, it’s going to wreck people’s lives and wreck the economy of this part of Mississippi."
Lee O. Sanderlin is an investigative and political reporter covering the state of Mississippi. Got a story tip? You can call him at 601-559-3857, send it to LSanderlin@gannett.com or message him on Twitter @LeeOSanderlin.
This article originally appeared on Mississippi Clarion Ledger: Mississippi Delta farmers suing Greenwood's Express Grain
