`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`FOREST RIVER FARMS, individually and
`on behalf of all others similarly situated,
`
`Case No. ____________________
`
`Plaintiff
`
`v.
`
`DEERE & CO. (d/b/a JOHN DEERE),
`
`Defendant.
`
`CLASS ACTION COMPLAINT
`
`JURY TRIAL DEMANDED
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 2 of 50 PageID #:2
`
`TABLE OF CONTENTS
`
`I.
`
`II.
`
`NATURE OF ACTION .....................................................................................................1
`
`JURISDICTION AND VENUE........................................................................................6
`
`III.
`
`PARTIES ............................................................................................................................7
`
`A.
`
`B.
`
`Plaintiff....................................................................................................................7
`
`Defendant & Co-Conspirators..............................................................................7
`
`IV.
`
`V.
`
`VI.
`
`TRADE AND COMMERCE ............................................................................................8
`
`RELEVANT MARKETS ..................................................................................................8
`
`FACTUAL ALLEGATIONS............................................................................................9
`
`A.
`
`B.
`
`C.
`
`D.
`
`E.
`
`F.
`
`G.
`
`Technology in John Deere Tractors ...................................................................10
`
`Deere’s Longtime Strategy of Forced Dealership Consolidation. ...................14
`
`Deere’s Promise—and Failure— To Provide the Full Spectrum of Repair
`Tools. .....................................................................................................................17
`
`To the Extent Deere Has Made Diagnostic and Repair Tools Available, They
`Are Insufficient to Restore Competition to the Deere Repair Services
`Market...................................................................................................................24
`
`There Are No Legitimate Reasons to Restrict Access to Necessary Repair
`Tools. .....................................................................................................................26
`
`Deere Has Not Provided Farmers and Independent Repair Shops with the
`Necessary Software and Continues to Misrepresent the Issue. .......................28
`
`Defendant’s Monopolization of the Deere Repair Services Market Has Led to
`Artificially High Prices and Record Profits for John Deere............................30
`
`VII. CLASS ACTION ALLEGATIONS ...............................................................................31
`
`VIII. ANTITRUST INJURY ....................................................................................................34
`
`IX.
`
`X.
`
`XI.
`
`CLAIMS FOR RELIEF ..................................................................................................35
`
`REQUEST FOR RELIEF...............................................................................................46
`
`JURY TRIAL DEMANDED...........................................................................................47
`
`i
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 3 of 50 PageID #:3
`
`Plaintiff alleges upon personal knowledge as to itself and its own actions, and upon
`
`information and belief, including the investigation of counsel as follows:
`
`I. NATURE OF ACTION
`
`1.
`
`This case is about John Deere’s monopolization of the repair service market for
`
`John Deere (“Deere”) brand agricultural equipment with onboard central computers known as
`
`engine control units, or “ECUs.” Farmers have traditionally had the ability to repair and maintain
`
`their own tractors as needed, or else have had the option to bring their tractors to an independent
`
`mechanic. However, in newer generations of its agricultural equipment, Deere has deliberately
`
`monopolized the market for repair and maintenance services of its agricultural equipment with
`
`ECUs (“Deere Repair Services”) by making crucial software and repair tools inaccessible to
`
`farmers and independent repair shops. Furthermore, Deere’s network of highly-consolidated
`
`independent dealerships (the “Dealerships”) is not permitted through their agreements with Deere
`
`to provide farmers or repair shops with access to the same software and repair tools the Dealerships
`
`have. As a result of shutting out farmers and independent repair shops from accessing the necessary
`
`resources for repairs, Deere and the Dealerships have cornered the Deere Repair Services Market
`
`in the United States for Deere-branded agricultural equipment controlled by ECUs and have
`
`derived supracompetitive profits from the sale of repair and maintenance services.
`
`2.
`
`This is an antitrust class action pursuant to Sections 1 and 2 of the Sherman Act (15
`
`U.S.C. §§ 1, 2) brought by Plaintiff Forest River Farms on its own behalf and on behalf of a class
`
`of persons and entities similarly situated. Plaintiff seeks to represent those persons and entities
`
`who purchased repair services from Defendant Deere and Co. (d/b/a John Deere) and Deere-
`
`affiliated independent Dealerships and technicians in the Deere Repair Services Market for Deere
`
`agricultural equipment from January 12, 2018 to the present.
`
`1
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 4 of 50 PageID #:4
`
`3.
`
`John Deere is indisputably the biggest player in agricultural machinery markets in
`
`the United States. Deere wields significant economic power in the market for large tractors and
`
`combine tractors in North America1 and has a larger market share than that of the next two biggest
`
`tractor makers, Case New Holland and Kubota Corp., combined.2
`
`4.
`
`Modern John Deere tractors, combines, and other agricultural equipment with
`
`ECUs (collectively referred to herein as “Tractors”) have grown increasingly technologically
`
`advanced. Tractors manufactured in the last two decades now require proprietary software and
`
`associated repair tools (collectively referred to as “Software”) to perform or complete many
`
`repairs. For example, an owner of a Tractor may be able to replace the transmission on their
`
`equipment, but that Tractor will not operate unless proprietary John Deere Software “approves”
`
`the newly-installed part. A farmer or mechanic may have the necessary mechanical parts,
`
`knowledge, and the skill to repair a Tractor, but without access to the Software, the repair is not
`
`recognized by the Tractor’s ECU, making the repair ineffective and the Tractor still unable to
`
`function properly.
`
`5.
`
`Despite the use of, and access to, this Software being essential to the continued
`
`functionality of its Tractors, Deere has deliberately made this necessary Software unavailable to
`
`individual owners and independent repair shops. Instead, Deere makes the full Software available
`
`only to Deere Dealerships and technicians, who are not permitted by Deere to sell it.
`
`1 Jennifer Reibel, Manufacturer Consolidation Reshaping the Farm Equipment Marketplace,
`Farm Equipment (Aug. 29, 2018), https://www.farm-equipment.com/articles/15962-
`manufacturer-consolidation-reshaping-the-farm-equipment-marketplace.
`2 Peter Waldman & Lydia Mulvany, Farmers Fight John Deere Over Who Gets to Fix an
`$800,000 Tractor, Bloomberg Businessweek (Mar. 5, 2020),
`https://www.bloomberg.com/news/features/2020-03-05/farmers-fight-john-deere-over-who-gets-
`to-fix-an-800-000-tractor.
`
`2
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 5 of 50 PageID #:5
`
`6.
`
`Historically, farmers who owned Deere Tractors have had the option of repairing
`
`their Tractors themselves or taking them to an independent repair shop of their choosing.
`
`By making the Software, for all practical purposes, unavailable, Deere has succeeded in
`
`foreclosing competition in the multi-billion dollar Deere Repair Services Market.
`
`7.
`
`Deere and the Dealerships are highly motivated to prevent competition, either from
`
`independent repair shops selling Deere Repair Services, or from farmers with the knowledge and
`
`skills to perform their own repairs. Deere’s business for its Repair Services is three to six times
`
`more profitable than its sales of original equipment.
`
`8.
`
`Deere’s monopolization of the Deere Repair Services Market allows Deere and the
`
`Dealerships to charge and collect supracompetitive prices for its services every time a piece of
`
`equipment requires the Software to diagnose or complete a repair. Consequently, Plaintiff and
`
`Class members have paid millions of dollars more for the repair services than they would have
`
`paid in a competitive market.
`
`9.
`
`John Deere has demonstrated that it understands that farmers have a right to repair
`
`their own Tractors, while at the same time misleading the public regarding how easy it is for
`
`farmers or independent repair shops to perform repairs.
`
`10.
`
`After a trade group representing Deere made a highly-publicized promise in 2018
`
`to make the necessary Software and tools available by January 2021, Deere has failed to follow
`
`through on this promise. In 2021, multiple investigative journalists attempted to determine whether
`
`the Software was available. The Dealerships’ response was that they did not sell the Software, or
`
`3
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 6 of 50 PageID #:6
`
`that it was only available to licensed dealers, and the Dealership was not allowed to sell it to anyone
`
`else.3
`
`11.
`
`Deere continues to exploit its relationship with customers who have purchased
`
`extremely expensive Tractors, locking customers into paying for expensive and inconvenient
`
`Repair Services from Deere and its Dealerships. Deere has created an effective tying arrangement,
`
`whereby the purchase of Deere Repair Services is tied to the initial purchase of Deere Tractors.
`
`12.
`
`The motive behind restricting access to the Software is simple: Deere and its
`
`Dealerships did not want their revenue stream from service and repair—a far more lucrative
`
`business than original equipment sales—to end when the equipment is purchased, as it often did
`
`in the past when owners could perform their own repairs or rely on individual repair shops.
`
`13.
`
`Deere’s scheme to prevent independent repairs creates additional revenue for Deere
`
`over the entire useful life of every piece of equipment it sells.
`
`14.
`
`Deere unlawfully stifles competition by blocking independent repair shops and
`
`reducing consumer choice in what would otherwise be a robust and competitive repair aftermarket,
`
`thereby artificially increasing Deere Repair Services prices to supracompetitive levels.
`
`15.
`
`Deere’s aggressive, forced consolidation of its Dealerships also was implemented
`
`with the intent of further limiting price competition for Deere Repair Services, even among Deere
`
`Dealerships.
`
`16.
`
`As a result of Deere’s unlawful withholding of the necessary Software to perform
`
`repairs from farmers and independent repair shops and its forced consolidation of the Dealerships,
`
`3 Jason Koebler & Matthew Gault, John Deere Promised Farmers It Would Make Tractors Easy
`to Repair. It Lied., Vice Motherboard (Feb. 18, 2021),
`https://www.vice.com/en/article/v7m8mx/john-deere-promised-farmers-it-would-make-tractors-
`easy-to-repair-it-lied.
`
`4
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 7 of 50 PageID #:7
`
`Plaintiff and the Class paid artificially inflated prices for Deere Repair Services during the Class
`
`Period. Prices in the Repair Services Market exceeded the amount they would have paid if the
`
`prices had been determined by a competitive market. Plaintiff and Class members were therefore
`
`injured by Defendant’s conduct.
`
`17.
`
`Deere’s illegal monopoly of the Deere Repair Services Market should be enjoined
`
`and dismantled, and Plaintiff and the Class should be reimbursed by Deere for the amount they
`
`overpaid for Deere Repair Services.
`
`18.
`
`Deere violated Section 1 of the Sherman Act by forcing consolidation of its
`
`affiliated Dealerships to eliminate inter-brand competition for Repair Services. Deere also violated
`
`Section 1 of the Sherman Act through its arrangements with Co-conspirator Dealerships to not sell
`
`the Software to farmers and independent repair shops. Finally, Deere violated Section 1 of the
`
`Sherman Act through forcing Plaintiff and Class Members to purchase Deere Repair Services from
`
`Deere once they were locked in to ownership of an expensive Deere Tractor. Deere’s tying
`
`arrangement between Deere Tractors and Repair Services had both the intent and effect of harming
`
`competition in the market for Deere Repair Services.
`
`19.
`
`Deere also violated Section 2 of the Sherman Act by monopolizing or attempting
`
`to monopolize the Deere Repair Services Market in a manner that harmed competition and injured
`
`the purchasers of such services by reducing choice and increasing prices in this market to
`
`supracompetitive levels. Deere has also leveraged its monopoly power over Deere Software to tie
`
`sales of its Tractors to sales of Deere Repair Services, in violation of Section 2 of the Sherman
`
`Act.
`
`5
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 8 of 50 PageID #:8
`
`20.
`
`Deere has unjustly enriched itself by profiting from Plaintiffs’ payment of
`
`supracompetitive prices for Deere Repair Services in violation of the antitrust laws and should be
`
`made to disgorge these profits.
`
`21.
`
`Plaintiff seeks declaratory and injunctive relief, treble and exemplary damages,
`
`costs, and attorneys’ fees. As for equitable relief, Plaintiff seeks an order requiring Deere to make
`
`the necessary Software available, at reasonable cost, to individuals and repair shops.
`
`II.
`
`JURISDICTION AND VENUE
`
`22.
`
`Plaintiff brings this action on behalf of itself and the Class under Section 16 of the
`
`Clayton Act (15 U.SC. § 26) to secure injunctive relief against Defendant for violating Sections 1
`
`and 2 of the Sherman Act (15 U.S.C. §§ 1 and 2), and to recover actual and compensatory damage,
`
`treble damages, interest, costs and attorneys’ fee for the injury caused by Defendant’s conduct.
`
`23.
`
`This Court has subject matter jurisdiction under 28 U.S.C. §§ 1331, 1337 and
`
`Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15(a) and 26.
`
`24.
`
`This Court also has subject matter jurisdiction pursuant to 28 U.S.C. § 1332(d)(2)
`
`because sufficient diversity of citizenship exists between parties in this action, the aggregate
`
`amount in controversy exceeds $5,000,000, exclusive of interest and costs, and there are 100 or
`
`more members of the proposed class.
`
`25.
`
`Venue is appropriate in this District pursuant to Sections 4, 12, and 16 of the
`
`Clayton Act, 15 U.S.C. 28 U.S.C. §15(a), and 28 U.S.C. § 1391(b), (c) and (d) because Defendant
`
`Deere & Company transacted business in this District, is licensed to do business or is doing
`
`business in this District, and because a substantial portion of the affected interstate commerce
`
`described herein was carried out in this District.
`
`6
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 9 of 50 PageID #:9
`
`26.
`
`The activities of Defendant as described herein, were within the flow of, were
`
`intended to, and did have direct, substantial, and reasonably foreseeable effects on the foreign and
`
`interstate commerce of the United States.
`
`III. PARTIES
`
`A. Plaintiff
`
`27.
`
`Plaintiff Forest River Farms is corporation located in Forest River, North Dakota.
`
`Plaintiff Forest River Farms owns five John Deere Tractors and two John Deere Combines with
`
`ECUs. During the Class Period, Plaintiff Forest River Farms purchased Deere Repair Services in
`
`North Dakota from a John Deere dealership to diagnose and repair Tractor and Combine
`
`malfunctions and suffered antitrust injury as a result of Defendant’s conduct alleged herein.
`
`B. Defendant & Co-Conspirators
`
`28.
`
`29.
`
`Deere & Co. is a publicly-traded company headquartered in Moline, Illinois.
`
`“Defendant” as used herein, includes, in addition to those identified specifically
`
`above, all of the named Defendant’s predecessors, including companies that merged with or were
`
`acquired by the named Defendant, as well as Defendant’s wholly-owned or controlled subsidiaries,
`
`dealerships, affiliated and/or authorized technicians, and/or Co-conspirators that sold Deere Repair
`
`Services in interstate commerce, directly or through its wholly-owned or controlled affiliates, to
`
`purchasers in the United States during the Class Period.
`
`30.
`
`Co-conspirators include independently-owned dealerships with agreements with
`
`Deere giving them the right to sell Deere Tractors and Deere Repair Services. Based on recent
`
`data, out of the 1,544 Dealerships affiliated with Deere, 91% of these Dealerships are owned by a
`
`“Big Dealer,” i.e., a dealer that owns 5 or more individual locations. Although not an exhaustive
`
`list, the largest Dealership groups are Ag-Pro Companies (75 locations in 8 states), United Ag &
`
`7
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 10 of 50 PageID #:10
`
`Turf (53 locations in 6 states), C&B Operations (36 locations in 6 states), Papé Machinery (35
`
`locations in 5 states); RDO Equipment (32 locations in 9 states); Brandt Holdings (32 locations in
`
`5 states); Greenway Equipment (31 locations in 2 states); Van Wall Group (31 locations in 4
`
`states); and Quality Equipment (28 locations in 2 states).
`
`IV. TRADE AND COMMERCE
`
`31.
`
`During the Class Period, Defendant, directly or through its subsidiaries or affiliated
`
`Dealerships, sold Deere Repair Services in the United States in a continuous and uninterrupted
`
`flow of interstate commerce and foreign commerce, including through and into this judicial
`
`district.
`
`32.
`
`During the Class Period, Defendant controlled all of the market for Deere Repair
`
`Services in the United States.
`
`33.
`
`Defendant’s business activities substantially affected interstate trade and commerce
`
`in the United States and caused antitrust injury in the United States.
`
`V. RELEVANT MARKETS
`
`34.
`
`Deere Repair Services Market. The principal relevant market
`
`to evaluate
`
`Defendant’s anticompetitive conduct is the Deere Repair Services Market.
`
`35.
`
`The Deere Repair Services Market constitutes various services and labor to repair,
`
`maintain, and clear fault codes from Deere Tractors.4
`
`36.
`
`There are no available substitutes for Deere Repair Services, and Deere Repair
`
`Services are not interchangeable with any other manufacturers’ service.
`
`37.
`
`The relevant geographic market is the United States.
`
`4 As defined supra, Deere “Tractors” for purposes of this litigation include all John Deere
`tractors, combines, and other agricultural equipment with ECUs.
`8
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 11 of 50 PageID #:11
`
`38.
`
`Defendant Deere has market and monopoly power in the relevant market through
`
`its control over access to the Software.
`
`39.
`
`Any independent repair shops who desire to compete with Deere in the Deere
`
`Repair Services Market would face insurmountable barriers. Defendant’s effective total control of
`
`the Software means that independent repair shops are unable to access the necessary resources to
`
`be able to meaningfully compete with Deere. Similarly, any farmers who wish to perform their
`
`own repairs and/or maintenance are also unable to access the resources necessary to do so.
`
`40.
`
`Independent repair shops and farmers cannot compete effectively in the Deere
`
`Repair Services Market without access to the Software.
`
`41.
`
`Deere Software Market. As discussed above, Defendant maintains market and
`
`monopoly power over the market for Deere Software. There is no available substitute for Deere
`
`Software, and it is not interchangeable with any other manufacturers’ product.
`
`42.
`
`Tractor Markets. The Deere Repair Services market and the market for Tractors
`
`are distinct. The “Tractor Markets” include the United States product markets for agricultural farm
`
`tractors, which include 2WD Farm Tractors, Compact Tractors, 4WD Farm Tractors, Row Crop
`
`Tractors, Scraper Tractors, Specialty Tractors, Utility Tractors, and Self-Propelled Combines.
`
`Defendant Deere is the largest agricultural machinery company in the world and has appreciable
`
`economic power in the U.S. Tractor Markets.
`
`VI. FACTUAL ALLEGATIONS
`
`43.
`
`Farmers traditionally and historically have been able to perform their own repairs
`
`on their own tractors. However, as software has becoming increasingly intertwined with basic
`
`operations of farming equipment, John Deere has restricted access to the necessary tools to make
`
`9
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 12 of 50 PageID #:12
`
`repairs, thereby cutting out owners and independent repair shops from the ability to make repairs
`
`to newer equipment.
`
`A. Technology in John Deere Tractors
`
`44. Modern Deere Tractors are technologically complex machines. These Tractors run
`
`firmware that is necessary for the Tractor to perform its basic functions. Without the firmware, the
`
`product is incomplete and will not run, making the firmware as vital a part to the basic functioning
`
`of a Tractor as a steering wheel or an engine. The code that runs the internal engine and the
`
`transmission components that are required to make the Tractor do anything are effectively part of
`
`the machine. The Tractors will not operate without that code.
`
`45.
`
`The central computer on a Tractor is the Engine Control Unit, or “ECU.” The ECU
`
`determines how—and if—the Tractor functions.
`
`46.
`
`Like cars, John Deere Tractors use a large number of sensors throughout the
`
`equipment that are constantly monitored by the ECU. When a sensor notices an error, no matter
`
`how small or serious, it can put the machine into “limp mode,” allowing farmers to move the
`
`machine slowly but not operate it fully. When the problem is diagnosed and repaired, the error
`
`code is cleared and the machine can continue working.5
`
`47.
`
`According to a report from a U.S. Public Interest Research Group, the John Deere
`
`S760 combine harvester has 125 different computer sensors in it. If any one of those sensors throw
`
`an error code, the combine will enter limp mode.
`
`48.
`
`Troubleshooting Deere Tractors—e.g.,
`
`interpreting the error codes—requires
`
`Software that Deere refuses to make available to farmers.
`
`5 Koebler & Gault, supra note 3.
`
`10
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 13 of 50 PageID #:13
`
`49.
`
`Since about 2000, Deere Tractors began using what is known as “CAN bus”
`
`systems in their machinery, standing for Controller Area Network. CAN bus is essentially a
`
`central electrical system that allows communications between different parts of the machinery.
`
`Sales manuals for Deere Tractors explain that an advantage of the system “allows the technician
`
`at the dealership to plug into the system using the Service ADVISOR™ computer program. The
`
`Service ADVISOR program links up to the tractor’s electrical system to read the
`
`communications between the controllers to determine where the problem is located and how it
`
`can be fixed.”6
`
`50.
`
`Service ADVISOR, per John Deere’s own sales manual materials, is
`
`a tool used by John Deere dealerships capable of providing technical and
`mechanical support for technicians and service managers through the use of a
`laptop computer. Service ADVISOR provides
`symptom-based diagnostics
`information, specific machine information, and electronic technical information. It
`also offers a connection to John Deere help and solutions through an extranet
`connection at the workshop and in the field.
`Service ADVISOR is a fast diagnostic testing system for all controller area network
`(CAN) bus tractors. This system is the cutting edge of service technology and will
`save time and money by faster equipment repair.
`(emphasis added).
`
`51.
`
`Even if the farmer is able to interpret the error code and determine what the problem
`
`is with the Tractor, it doesn’t matter how tech-savvy or experienced a mechanic a farmer is;
`
`without access to the necessary software tools, farmers must call the dealership to repair, or clear
`
`fault codes for, their machine.
`
`6 See John Deere & Co Sales Manual, Electrical, CAN bus electrical system (2017),
`https://www.dot.state.oh.us/Divisions/ContractAdmin/Contracts/PurchDocs/207-
`19/DeerComp01/6110M%20Product%20Info.pdf.
`11
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 14 of 50 PageID #:14
`
`52.
`
`Farmers report their Tractors shutting down from computer faults and having to sit
`
`and wait for a John Deere technician to arrive while they lose valuable time, which can lead to
`
`expensive crop losses.
`
`53.
`
`Farmers in general face issues related to long wait times for Deere technicians, but
`
`black farmers reported that they face disproportionately longer wait times. The National Black
`
`Farmers Association (NBFA) stated that after NBFA members purchased from Deere, responses
`
`for service on its equipment are followed upon more slowly compared to calls for service from
`
`their white counterparts.7
`
`54. Without access to the Software and other tools needed to diagnose and repair the
`
`error, farmers must rely on Deere dealerships and technicians to travel to where the equipment is,
`
`plug in the necessary tools, and clear the error codes.
`
`55.
`
`Replacing parts on a Tractor also can result in “bricking” of the machine if the
`
`proper Software is not used. After a new part is installed on a Tractor, a program called Service
`
`Advisor needs to be connected to the ECU to authorize the new parts. If the new part is not
`
`“authorized” by the Software, the engine of the Tractor will not start, rendering the Tractor useless
`
`to its owner until the owner pays a Deere technician to authorize the repair and therefore restore
`
`operation of the Tractor.
`
`56.
`
`During harvest time, when Tractors, including combines, are running at full throttle
`
`for weeks on end, it’s common for mechanical issues to arise. Farmers who try to solve problems
`
`themselves or take their Tractors to more convenient repair shops are blocked from completing the
`
`7 Black Farmers’ Boycott Against John Deere Continues, Deere has Lied for Years According to
`Recent Article, National Black Farmers Association (Feb. 25, 2021),
`https://www.blackfarmers.org/blog/black-farmers-boycott-against-john-deere-continues-deere-
`has-lied-for-years-according-to-recent-article.
`
`12
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 15 of 50 PageID #:15
`
`repairs without the necessary Software. For example, one customer who hired an independent
`
`agricultural equipment repair shop to replace a faulty moisture meter on a combine still had to wait
`
`and pay for the dealer to come out and use Software to authorize the part.8
`
`57.
`
`As of 2021, the reported cost for Repair Services from Deere or an authorized
`
`Dealer could range from $150–$180 per hour, with additional charges for travel and parts.
`
`58.
`
`Regardless of a farmer’s own ability and knowledge regarding how to repair the
`
`Tractor they own, without the relevant Software, an authorized John Deere technician must be
`
`called to perform many repairs.
`
`59.
`
`Logistically, this is a nightmare for many farmers. When a farmer calls a dealer to
`
`perform a repair, the farmer is at the mercy of the dealer’s schedule and must pay whatever the
`
`cost is—including travel expenses—even if the problem could be fixed in 15 minutes with access
`
`to the Software. Farmers also may work far away from the nearest dealership or technician, leading
`
`them to have to pay substantial amounts for travel time or the cost of having their equipment hauled
`
`to a dealership.
`
`60.
`
`Deere has made farmers dependent on Deere for repairs. Farmers, who often have
`
`a lifetime of skills built up enabling them to fix their own equipment, are forced to sit and wait for
`
`a service technician from Deere to arrive on site and charge $150 or more per hour for labor, on
`
`top of other costs.
`
`61.
`
`These additional costs paid to Deere by farmers cut into an already razor-thin profit
`
`margin on crops. Farmers in the United States are currently experiencing drastically increasing
`
`operating expenses while revenue and profits from crop yields remains stagnant. For example,
`
`8 Mae Anderson, Without ‘right to repair,’ businesses lose time and money, Associated Press
`(Aug. 10, 2021), https://apnews.com/article/technology-business-
`9f84a8b72bb6dd408cb642414cd28f5d.
`
`13
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 16 of 50 PageID #:16
`
`between 1996 and 2020, total costs for growing corn increased by 193% while yields only
`
`increased by 13.7%. In that same period, costs for growing soybeans increased by 202% while
`
`yields increased only by 12.3%.
`
`62.
`
`As a result, farmers have had difficulty paying their outstanding operating debts—
`
`estimated at well over $400 billion in 2019—and the rate of farm bankruptcies has accelerated,
`
`with declared farm bankruptcies increasing by 24% from 2018 to 2019, the biggest yearly increase
`
`since the Great Recession.
`
`63.
`
`Furthermore, given farmers’ investments in Deere Tractors, which can run upwards
`
`of half a million dollars, they have no reasonable choice but to pay for Deere’s Repair Services.
`
`The farmers are locked in to using Deere Tractors, as switching costs are so high and farmers
`
`expect to be able to use a Tractor for decades.
`
`64. While some farmers own these expensive machines outright, many farmers lease
`
`the equipment. The leaseholder is often Deere itself, which has become the fifth-largest
`
`agricultural lender in the sector.9
`
`B. Deere’s Longtime Strategy of Forced Dealership Consolidation.
`
`65.
`
`In addition to being forced to purchase Repair Services from Deere, farmers in
`
`many areas are faced with limited or nonexistent choice as to which Deere Dealership to purchase
`
`Repair Services from. This lack of meaningful choice is in large part due to Deere’s concerted
`
`efforts to force Dealerships to consolidate or lose their affiliation with Deere.
`
`9 Jesse Newman & Bob Tita, America’s Farmers Turn to the Bank of John Deere, Wall Street
`Journal (July 18, 2017), https://www.wsj.com/articles/americas-farmers-turn-to-bank-of-john-
`deere-1500398960.
`
`14
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 17 of 50 PageID #:17
`
`66.
`
`Starting approximately in the early 2000s (and coinciding with when ECUs were
`
`first being widely used in Deere Tractors), Deere implemented an aggressive strategy that
`
`pressured Dealerships to consolidate.
`
`67.
`
`In a series of meetings in Louisville, Kentucky, in the summer of 2002, Deere told
`
`dealers they should plan on a future in which they would either be a buyer or a seller.10 One former
`
`owner of a dealership in Virginia reported that in 2002 he began receiving letters, emails, and visits
`
`from Deere officials almost monthly urging him to either acquire another dealer or cash out.11
`
`68.
`
`Deere’s strategy worked. In 1996, the total number of Deere Dealership locations
`
`was approximately 3,400. By 2007, this number had decreased to 2,984. In 2021, only 1,544
`
`Dealership locations remained. Only 144 of these Dealerships are not owned by “Big Dealers,”
`
`i.e., Dealerships that operate five or more individual Dealership locations. Very few single-
`
`location dealerships remain.
`
`69.
`
`In 2009, a former owner of a Deere-affiliated dealership, Roy Dufault, reported to
`
`AgWeek, a weekly agricultural newspaper, that representatives from Deere pressured him to sell
`
`his small dealership in Fosston, Minnesota. Deere told him that for the large dealers in the area to
`
`continue to grow, Dufault needed to get out of the way, as his dealership was a hindrance to their
`
`profitability.12 Deere’s representatives told Dufault that there was no need for a location in Fosston,
`
`and that another dealership could cover the trade area remotely. At the time Deere terminated its
`
`dealer agreement with Dufault, customers expressed their concern about where they would have
`
`10 Ilan Brat & Timothy Aeppel, Why Deere Is Weeding Out Dealers Even as Farms Boom, Wall
`Street Journal (Aug. 14, 2007), https://www.wsj.com/articles/SB118705668767896842.
`11 Id.
`12 John Deere leaves a dealer and his customers high and dry, AgWeek (Sept. 21, 2009),
`https://www.agweek.com/news/3787513-john-deere-leaves-dealer-and-his-customers-high-and-
`dry.
`
`15
`
`
`
`Case: 1:22-cv-00188 Document #: 1 Filed: 01/12/22 Page 18 of 50 PageID #:18
`
`their Deere equipment serviced. In 2021, there is not a Deere Dealership within 20 miles of
`
`Fosston, and none within 100 miles that are not owned by a Big Dealer.
`
`70.
`
`In 2013, a single-location Dealership in New Hampshire, R.N. Johnson Inc., had
`
`its dealer agreement with Deere canceled after being in business 84 years. The former owner said
`
`that this action was part of