VeraSun Energy Corp. was a leader in production of renewable fuel. However, back in the fourth quarter of 2008, the corporation filed for Chapter 11 bankruptcy protection. The company claims that the move was made so that the ethanol producer could maintain business as usual as they reorganized the companies infrastructure. In 2009, VeraSun sold off several plants to smaller companies, as well as some to Valero.
In response to the requests for repayment, officials are urging the farmers to hire legal counsel. Iowa State Representative Mark Kuhn is among those officials.
''People thought the VeraSun bankruptcy problem was behind them,'' said Kuhn. He also said, ''one [legal option] is the normal causes of business defense, where producers would prove that they were acting within the normal laws of business with VeraSun at the time and that there was nothing extraordinary.''
Farmers congregated at a Holiday Inn in downtown Sioux Falls, South Dakota to discuss the matter.
''We received a letter about a week and a half ago. It came in a plain white envelope. It didn't look like anything important,'' said Conrad Schardin, a farmer from Lake Benton Minnesota. ''They say we have 30 days to respond. If we don't respond by that they could take us over back to New York or wherever this law firm is at.''
The farmers are not alone in their fight. Joining them at the meeting were a few lawyers, Lisa Richardson, the executive director of the South Dakota Corn Grower's Association, as well as Dale Blumenhourst, a representative from the South Dakota department of agriculture.
Richardson hopes that by organizing, the farmers can keep legal costs to a minimum. ''What we're trying to do is organize so we have limited legal fees,'' she said.
Blumanhourst's main concern was making sure that the farmers had representation. ''At this point it's just a matter of making sure they get proper counsel,'' Blumenhourst said. ''That they do in fact respond to the letters.''
According to Richardson, VeraSun is within its rights to request a repayment.
''I understand it's a legal course they can take. I don't consider it ethical, but it is legal,'' Richardson said.
