Farmers promised CRC Plus settlement checks

An English fable tells the story of four tourists — two British, one American, and one Czechoslovakian — on safari in Africa.

One morning, the story goes, the American and the Czechoslovakian decided to venture out sightseeing without a local guide. Unfortunately, the two are surprised by a pride of lions and the Czechoslovakian is swallowed whole by an especially ferocious lion.

Since the only pride of lions in the area consists of one male amongst a large group of female cats, though, there remains a slim hope the unlucky tourist can still be saved.

However, the group is told, the local wildlife officials can only shoot one lion in their quest to rescue the Czech from inside the lion. That means they have to be completely sure the right suspect is identified.

That will not be a problem, the American tourist explains, as he is sure his traveling companion has been consumed by the male lion. So the local wildlife officials shot the male lion and split him open, but alas they find nothing.

The moral of the story: never trust someone who tells you that the Czech is in the male.

That take home message may also apply to rice farmers included in the CRC Plus class action lawsuit.

Two years after the suit was filed, and 14 months after a settlement was agreed to in the case, rice producers included in the class action have yet to see any money.

That may soon change. A letter sent Aug. 3 from the U.S. District Court presiding over the case in Little Rock, Ark., to rice growers affected by the litigation settlement asks producers for their tax identification numbers in order to process claims. Rice growers must return their identification numbers, or Social Security numbers by Aug. 31 in order to be included in the settlement.

“We are in final stage of preparation for distributing the proceeds from the CRC Plus settlement,” the letter states.

According to the New Orleans firm representing the plaintiffs in the lawsuit against American Agrisurance (AmAg), the settlement money will be divided among the total responses received from the Aug. 3 letter to rice growers. The checks reportedly will be printed and mailed out shortly after the Aug. 31 response deadline.

“Farmers should have checks in their hands by mid-September,” an official with the law firm says. “The money is gaining interest and will be calculated using a special master on formula and will be dependent on acreage and the amount of crop each farmer had.”

Pete Dunn with Dunn, Marley and Harris in Clarksdale, Miss., who sold the CRC Plus policies to farmers, adds, “We contacted the claim administrator and were told that the checks are imminently in the mail and should be out to farmers within the next several weeks.”

Dunn, however, says he was unable to determine the per acre amount of money farmers included in the lawsuit will receive. “I guess we just won't know that information until after this is all done.”

There is some speculation that the pool of farmers sharing in the $3.7 million-dollar proposed legal settlement announced in June 2000 will be smaller than was earlier projected.

An estimated 6,000 rice producers applied for the supplemental 3-cent-per-pound crop revenue insurance coverage offered by AmAg. However, an unnamed source says that of the more than 6,000 letters that went out to growers eligible to be included in the class action, only about 2,600 responses were returned.

“Whatever the amount is on the check a rice farmer gets, something is better than nothing. Maybe the settlement will at least make up for the agonizing moments farmers had while they were making the decisions related to the insurance coverage of their rice crop,” Dunn says.

Filing the class action suit on behalf of himself and other rice farmers, Arkansas farmer Jimmy Wallace alleged breach of contract, fraud and violation of the Arkansas Deceptive Trade Practices Act by the crop insurance company.

Shortly after Wallace and hundreds other Delta rice growers signed up for the revenue insurance product offered by AmAg, the company abruptly announced March 1, 1999, that it was canceling its previous offer to farmers. Coming to the realization that the CRCPlus policies the company had sold were threatening the company's bottom line, Am Ag CEO Rick Gibson told its customers that it was cutting CRCPlus coverage for rice from 3 cents to 1.5 cents per pound.

The proposed class action lawsuit settlement includes any and all farmers in the nation who applied for CRCPlus coverage on rice for 3 cents. Anyone that applied for 3-cents-per-pound crop revenue coverage and didn't receive it is included.

One-third of the settlement will be paid to attorneys handling the case, and an “incentive award” will be paid to those who have served as class representatives in the litigation.

American Agrisurance's parent company, Acceptance Insurance Company Inc., has said it is settling the case “solely to avoid further litigation expense and inconvenience, and to remove the distraction of burdensome and protracted litigation.”

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