8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 1 of 30 - Page ID # 1
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF NEBRASKA
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`BAYER US LLC,
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`Plaintiff,
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`v.
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`ALTEN, LLC; MEAD CATTLE
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`COMPANY, LLC; GREEN DISPOSAL
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`MEAD, LLC; PLATTE RIVER GREEN
`FUELS, LLC; and TANNER SHAW, in his )
`individual and official capacities,
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`Defendants.
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`Case No. 8:22-cv-82
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`COMPLAINT AND DEMAND FOR
`JURY TRIAL
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`Plaintiff Bayer US LLC, for its Complaint against the above-named Defendants, states and
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`alleges as follows:
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`NATURE OF THE CASE
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`1.
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`Plaintiff Bayer US LLC (“Bayer”) brings this action seeking indemnification,
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`contribution, and contract and other damages from the parties responsible for both the
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`environmental conditions at the site of the AltEn ethanol plant in Mead, Nebraska and the costs
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`Bayer has been incurring to respond to those conditions and stabilize the site.
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`2.
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`Defendants AltEn, LLC (“AltEn”), Mead Cattle Company, LLC (“Mead Cattle”),
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`and Green Disposal Mead, LLC (“Green Disposal”) operated at the site of the AltEn plant and
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`worked together as a “closed-loop” system comprising an ethanol plant, cattle feedlot, and bio-
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`char production unit. Defendant Tanner Shaw is the President of AltEn, Mead Cattle, Green
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`Disposal and Platte River, and all are under his direction and control.
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 2 of 30 - Page ID # 2
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`3.
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`In June 2016, Monsanto Company—now an affiliate company of Bayer
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`(collectively referred to as “Bayer”)1 —and AltEn entered into a Renewable Resource Material
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`Agreement that governed the sale of Bayer’s treated and untreated seed (“RRM”) to AltEn for its
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`use in ethanol production. Under the Agreement, AltEn was obligated to handle and store RRM
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`safely; segregate RRM from other seed whose by-product might be used for livestock feed or
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`agronomic purposes; convert all solid by-products derived from RRM into bio-char; recycle any
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`liquid by-products derived from RRM within the facility; pay Bayer for the RRM; indemnify
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`Bayer; return any unused seed to Bayer; and provide insurance coverage to Bayer as an additional
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`insured under AltEn’s liability policies. The Agreement also required AltEn to comply with all
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`applicable environmental laws and regulations and to notify Bayer about environmental incidents
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`and non-compliance at the facility. AltEn was also prohibited from utilizing its relationship with
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`Bayer in promotional or marketing efforts without Bayer’s explicit written permission.
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`4.
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`AltEn failed to properly handle, store, and otherwise manage the RMM and the by-
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`products from the ethanol manufacturing process in violation of federal and state laws and AltEn’s
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`contractual commitments to Bayer. AltEn did not inform Bayer about the numerous notices of
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`non-compliance and violations issued by state regulators. AltEn also failed to pay Bayer for the
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`RRM as AltEn was obligated, and improperly referenced Bayer and/or Monsanto in promotional
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`and marketing efforts without permission. These and other failures led to the release of untreated
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`thin stillage and manure from a tank at the AltEn plant that flowed onto neighboring properties,
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`the stockpiling of thousands of tons of wet cake by-product, and the mismanagement of millions
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`1 In June 2018, an indirect and wholly owned subsidiary of Bayer AG merged with Monsanto Company
`with Monsanto surviving the merger. At that time, Monsanto became an indirect and wholly owned subsidiary of
`Bayer AG. Bayer US LLC and Monsanto Company are indirect and wholly-owned subsidiaries of Bayer AG.
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`2
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 3 of 30 - Page ID # 3
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`of gallons of wastewater in lagoons that were, under AltEn’s management, perilously close to
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`failure.
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`5.
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`Instead of complying with numerous emergency orders, notices of violations and
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`other directives issued by the Nebraska Department of Environment and Energy (“NDEE”) and
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`engaging in remediation efforts, AltEn and its officers and affiliates – led by Tanner Shaw – have
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`(i) abandoned the site, (ii) sold off their assets to prevent their creditors (including the State and
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`Bayer) from having access to assets necessary to perform remediation and reimburse Bayer for the
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`costs it has incurred to respond at the site, (iii) hindered the response and stabilization efforts
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`performed by Bayer and other seed companies, (iv) refused to undertake or participate in any way
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`in those response and stabilization activities, (v) interfered with Bayer’s right to obtain insurance
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`proceeds under AltEn’s pollution liability policy and (vi) dissipated assets to avoid any
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`responsibility for the environmental problems that Defendants caused.
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`6.
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`At the request of Federal and State authorities, Bayer conducted extensive
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`emergency response stabilization activities at the site beginning in February 2021.
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`7.
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`To date, Bayer and other seed companies have spent millions of dollars to stabilize
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`the site and to ensure that the materials abandoned by AltEn were stable and contained so they
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`would not be the source of a potential release from the site. Efforts to date include:
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`Reduce water levels in the lagoons below safe operating levels;
`Consolidate and temporarily cover wet cake to eliminate storm
`water runoff and decrease odor;
`Construct new water storage ponds to hold treated water during the
`winter weather;
`Treat more than 13 million gallons of contaminated water;
`Develop land-application water-quality standards for treated water;
`Empty and reconstruct the emergency spill basin;
`Remove material from both digesters; and
`Winterize the AltEn physical plant.
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`3
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 4 of 30 - Page ID # 4
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`8.
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`As a result of Defendants’ abandonment of the site, Bayer and other seed companies
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`have also been forced to pay site utility bills and equipment lease payments in order to facilitate
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`their emergency response efforts.
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`9.
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`Despite AltEn’s contractual obligations to Bayer, AltEn has failed to reimburse
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`Bayer for the costs it is incurring to respond to the conditions at the AltEn facility, and has
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`interfered with its insurance carrier’s attempts to investigate and resolve Bayer’s coverage claim.
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`10.
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`Bayer seeks relief against AltEn, Mead Cattle, Green Disposal, Platte River and
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`potentially other related entities to contribute to the costs they caused, are responsible for, and have
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`thus far willfully avoided and prevented from being paid.
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`PARTIES
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`11.
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`Plaintiff Bayer US LLC is a Delaware limited liability company with its principal
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`place of business in New Jersey and its sole member is Bayer Corporation which is an Indiana
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`corporation with a principal place of business in New Jersey.
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`12.
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`Defendant Tanner Shaw (“Shaw”) is an individual who, upon information and
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`belief is domiciled in Kansas. Shaw is the individual at the center of a complex web of companies
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`related to the AltEn ethanol plant in Mead, Nebraska. Shaw’s relations to the entity defendants
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`are as set out hereinafter. Until at least 2021, Shaw listed 5225 Renner Road, Lake Quivira, Kansas
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`(“the Quivira Mansion”) as his mailing address and that of many of the entity defendants.
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`13.
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`Defendant AltEn, LLC is a Kansas limited liability company with its principal
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`office in Shawnee, Kansas. AltEn is registered as a foreign limited liability company in Nebraska.
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`AltEn owned and operated an ethanol manufacturing plant located at 1344 County Rd. 10, Mead,
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`Nebraska 68041 (“AltEn Facility”).
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`4
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`14.
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`Defendant Mead Cattle Company, LLC (“Mead Cattle”) is a Nebraska limited
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`liability company. Mead Cattle owned and operated a cattle feedlot located adjacent to the AltEn
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`Facility property at times relevant to this action.
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`15.
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`Defendant Green Disposal Mead, LLC is a Nebraska limited liability company.
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`Green Disposal owned and operated a bio-char production unit on the AltEn Facility property.
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`16.
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`Defendant Platte River Green Fuels, LLC is a Kansas limited liability company
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`with its principal office last located at the Quivira Mansion address.
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`JURISDICTION AND VENUE
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`17.
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`This Court has diversity jurisdiction over the claims in this case pursuant to 28
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`U.S.C. § 1332. The parties are citizens of different states, and the amount in controversy exceeds
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`$75,000.00, exclusive of interest and costs.
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`18.
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` Bayer US LLC is a Delaware limited liability company with its principal place of
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`business in New Jersey and its sole member is Bayer Corporation which is an Indiana corporation
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`with a principal place of business in New Jersey. Therefore, Bayer US LLC is a citizen of Indiana
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`and New Jersey for purposes of diversity jurisdiction. Upon review of information publicly
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`available to Bayer US LLC, and as explained in the following paragraphs, none of the named
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`Defendants or their respective members or submembers are citizens of Indiana or New Jersey.
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`19.
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`AltEn is a Kansas limited liability company with its principal office last located at
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`the Quivira Mansion, 5225 Renner Road, Shawnee, Kansas 66217. Upon information and belief,
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`AltEn’s known member is Platte River Green Fuels, LLC. Platte River Green Fuels, LLC’s known
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`members are E3 Platte River, LLC, and Falcon Energy, LLC. E3 Platte River, LLC’s known
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`members are Falcon Energy, LLC and E3 Bio Fuels, LLC. Falcon Energy, LLC is a forfeited
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`Kansas for-profit corporation. E3 Bio Fuels, LLC’s known member is Earth, Energy &
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`Environment, LLC. Earth, Energy & Environment, LLC has two members, Dennis Langley
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`5
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 6 of 30 - Page ID # 6
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`(deceased) and Langley Group Ltd., a Kansas for-profit corporation. All of the members and sub-
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`members of AltEn are Kansas entities and share AltEn’s principal address, that being the Quivira
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`Mansion. Therefore, upon review of publicly available information, AltEn is a citizen of Kansas
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`for purposes of diversity jurisdiction.
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`20. Mead Cattle is a Nebraska limited liability company, with its principal office
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`located at 1344 County Road 10, Mead, Nebraska 68041 (the same as the AltEn Facility). Upon
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`information and belief, the members and sub-members of Mead Cattle trace back to one or more
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`of the entities and other persons identified in Paragraph 19, and Mead Cattle is therefore a citizen
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`of Kansas for purposes of diversity jurisdiction.
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`21.
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`Green Disposal is a Nebraska limited liability company, with its principal office
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`located at 1344 County Road 10, Mead, Nebraska 68041 (the same as the AltEn Facility). Green
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`Disposal owned and previously operated a bio-char production unit at the AltEn Facility. Upon
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`information and belief, the members and sub-members of Green Disposal trace back to one or
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`more of the entities and other persons identified in Paragraph 19, and Green Disposal is therefore
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`a citizen of Kansas for purposes of diversity jurisdiction.
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`22.
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`Upon information and belief, Tanner Shaw is domiciled in and is a citizen of Kansas
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`for purposes of diversity jurisdiction.
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`23.
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`At all relevant times, upon information and belief, AltEn, Mead Cattle, Green
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`Disposal, and Platte River were operated and/or managed by the same persons, among whom were
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`Shaw and his late stepfather, Dennis Langley, both residents of Kansas.
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`24.
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`Venue is proper in this Court under 28 U.S.C. § 1391(b)(2) in that a substantial part
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`of the events or omissions giving rise to the claims occurred in this District, witnesses are located
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`in this District, and other lawsuits concerning similar claims are pending in this District.
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`6
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 7 of 30 - Page ID # 7
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`AltEn’s Ethanol Manufacturing Facility
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`FACTUAL BACKGROUND
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`25.
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`The AltEn Facility in Mead, Nebraska, began ethanol manufacturing operations on
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`or about January 2015, and used grain to produce approximately 24,000,000 gallons of ethanol
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`annually.
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`26. Mead Cattle owned and operated a cattle feedlot located immediately adjacent to
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`the AltEn Facility. The operations were designed to function as a “closed-loop” system whereby
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`Mead Cattle would transfer manure to the AltEn Facility, whose two digesters would then convert
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`the manure into methane used to power the ethanol production. AltEn would convey by-product
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`from the ethanol production, known as wet distiller’s grain a/k/a wet cake back to Mead Cattle as
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`feed for the cattle.
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`27.
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`Green Disposal owned a bio-char unit at the AltEn Facility at all times relevant to
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`this action. The bio-char unit incinerated wet cake into a charcoal-like material known as bio-
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`char.
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`28.
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`The bio-char was stored in large totes made of a flexible, woven fabric called
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`supersacks.
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`29.
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`The AltEn Facility and Mead Cattle occupied two adjacent lots and shared several
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`common easements.
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`30.
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`The AltEn Facility, Mead Cattle, and Green Disposal shared an entrance onto the
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`property, and the only entry points were on the Mead Cattle lot.
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`31.
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`The AltEn Facility and Mead Cattle shared facilities and utilities including a natural
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`gas pipeline.
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 8 of 30 - Page ID # 8
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`32.
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`The AltEn facility received discarded food and other feedstocks and acquired
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`various raw products for its operations, many of which remain on the facility and will require
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`management.
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`33.
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`AltEn marketed what it called a “Green Recycling Program” to agricultural
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`companies like Bayer, under which the companies would supply corn, wheat, sorghum, milo seed,
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`and other grains (collectively, “Seed”) to AltEn for use in its ethanol manufacturing process. See,
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`e.g., Exh.2, AltEn 2020 email soliciting seed companies’ participation.
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`34.
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`Bayer, AgReliant Genetics, Beck’s Superior Hybrids, Pioneer/Corteva, Syngenta
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`Seeds, and WinField Solutions (collectively, “Seed Companies”) were among many companies
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`that sent Seed to the AltEn Facility.
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`Bayer’s Contracts with AltEn
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`35.
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`In June 2016, Bayer and AltEn entered into the RRM Agreement to sell RRM to
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`AltEn for its use in ethanol production. A copy of the RRM Agreement as amended by two
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`subsequent contract Amendments are attached, and incorporated herein, as Exhibits 1, 1-A and 1-
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`B.
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`36.
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`According to the RRM Agreement, acceptance of RRM by AltEn transferred all
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`title, risk of loss and all other incidents of ownership from Bayer to AltEn. See Exh. 1, RRM ¶ 6.
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`37.
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`The 2016 RRM Agreement obligated AltEn to pay Bayer $25 per ton of RRM. See
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`Exh.1, RRM-Exhibit A, ¶ 10. The Amendments to the 2016 RRM Agreement updated the payment
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`amounts and total outstanding owed to Bayer. See Exhs. 1A and 1B.
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`38.
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`By entering into the RRM Agreement, AltEn represented and warranted to Bayer
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`that:
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 9 of 30 - Page ID # 9
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`AltEn was engaged in the business of using RRM for ethanol production
`a)
`and had “the requisite experience, knowledge and expertise; suitable facilities; qualified
`personnel; and legal right to utilize the RRM supplied hereunder to produce ethanol;”
`b)
`AltEn was “in compliance with and, in utilizing RRM, shall remain in
`compliance all applicable laws, ordinances, orders, rules, regulations and actions of the
`United States, EPA, NDEQ and any state or political subdivision thereof or other
`governmental unit or agency…;”
`c)
`AltEn had obtained, is in compliance with, shall keep in effect, and shall
`remain in compliance with all permits, licenses and certifications necessary for utilizing
`RRM for ethanol production as contemplated.
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`See Exh. 1, RRM ¶ 7.
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`39.
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`The RRM Agreement required AltEn to promptly notify Bayer of federal, state, or
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`local warnings, citations, indictments, claims, notices of violations, lawsuits or other proceedings
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`related to AltEn’s use of RRM. See Exh. 1, RRM ¶ 12.
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`40.
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`The RRM Agreement obligated AltEn to convert all solid by-products resulting
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`from use of the RRM into bio-char and to recycle all liquid by-products entirely within AltEn’s
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`facilities. In no event was AltEn permitted to use any by-products from Bayer RRM for livestock
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`feed or for agronomic purposes. AltEn agreed to handle, store, and process RRM so that it was
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`segregated from seed whose by-products from ethanol manufacturing might be used for livestock
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`feed or agronomic purposes. See Exh. 1, RRM ¶ 8.
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`41.
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`The RRM Agreement prohibited AltEn from referring to Bayer or any of Bayer’s
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`subsidiaries or use or refer to any of Bayer’s trademarks including logos and taglines in any way,
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`including but not limited to promotional and marketing materials or press releases, without
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`prior written permission from Bayer except as necessary to provide services under the Agreement.
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`See Exh. 1, RRM ¶ 9.
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`42.
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`Under the RRM Agreement, AltEn was obligated to indemnify Bayer from and
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`against “any and all third-party or direct claims, liabilities, suits, proceedings, judgments, orders,
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`fines, penalties, damages (special, incidental, consequential, or indirect), losses, costs, and
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`9
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`expenses” arising out of or connected with any RRM following delivery, AltEn’s and its
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`contractors’ activity under or related to the RRM Agreement, negligent acts or omissions by AltEn
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`or its employees or agents, or any failure by AltEn or its employees or agents to comply with the
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`RRM Agreement. Such covered damages include but are not limited to “damage to or loss or
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`destruction of any property” and “any contamination of, injury or damage to or adverse effect on
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`persons, animals, aquatic or wild life, vegetation, waters, air, land or the environment.” See Exh.
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`1, RRM ¶ 10.
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`43.
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`The RRM Agreement also obligated AltEn to include Bayer as an additional
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`insured on several types of insurance policies, including $2 Million worth of Comprehensive
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`General Liability coverage and $1 Million of Excess/Umbrella coverage. See Exh. 1, RRM ¶ 11.
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`AltEn’s Ethanol Production Practices
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`44.
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`Not long after the AltEn Facility started producing ethanol in 2015, AltEn began
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`storing wet cake in piles at various locations on the AltEn property.
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`45.
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`On October 23, 2018, AltEn applied to the Nebraska Department of Agriculture
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`(“NDA”) to register its distiller’s grain by-product as a soil conditioner, and AltEn received a label
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`for such use.
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`46.
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`In the following months, NDA collected samples of AltEn’s distiller’s grain, and
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`lab analysis showed detectable concentrations of pesticides.
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`47.
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`Based in part on the lab results, NDA determined the registered soil conditioner
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`was adulterated and issued a Stop-Use and Stop-Sale Order that prohibited the use of AltEn’s
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`distiller’s grain (wet cake) as a soil conditioner, and accordingly AltEn cancelled the registration
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`of its distiller’s grain as a soil conditioner on August 14, 2019.
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`48.
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`AltEn did not inform Bayer about the NDA Stop-Use and Stop-Sale Order.
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`49.
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`On September 23, 2019, NDEE issued a Notice of Violation (“NOV”) to AltEn for
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`waste disposal violations, including operating a solid waste management facility on its property
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`without a permit, and prohibited AltEn from stockpiling the distiller’s grain onsite and required
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`disposal of the distiller’s grain at a permitted solid waste management facility. After receiving the
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`NOV, AltEn continued to stockpile distiller’s grain onsite without submitting a disposal plan or
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`having a solid waste management permit as ordered in the NOV.
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`50.
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`51.
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` AltEn did not inform Bayer about the NOV.
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`By February 2020, Green Disposal was also facing environmental violations and
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`entered into a Consent Decree with NDEE to allow limited operation and testing of its bio-char
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`unit at the AltEn Facility. NDEE took samples of the material generated by the bio-char unit in
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`March 2021, and test results indicated that the bio-char contained detectable levels of pesticides.
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`52.
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`53.
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`AltEn did not inform Bayer about Green Disposal’s environmental violations.
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`On February 1, 2021, NDEE conducted a site visit and inspected three lagoons
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`(West, Northeast, and Southeast Lagoons) at the AltEn Facility and found that each lagoon was
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`operating in excess of its maximum operating depth and within the area designed for freeboard.
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`NDEE also found that lagoon liners had not been repaired as required by the NOV and were badly
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`damaged.
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`54.
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`On February 4, 2021, NDEE issued a Complaint and Order requiring AltEn to
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`immediately cease discharge of industrial wastewater into its wastewater lagoons.
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`55.
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`In response to NDEE’s Complaint and Order, AltEn shut down the AltEn Facility
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`on February 8, 2021, and stopped its ethanol production.
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`56.
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` Bayer visited the Site after the shutdown and determined that AltEn had not been
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`following the contract requirements. AltEn had become lax in meeting specific requirements of its
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 12 of 30 - Page ID # 12
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`contract, which included segregating the RRM, not using RRM for agronomic purposes, running
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`solid by-products generated from RRM through its bio-char unit, recycling liquid wastewater
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`generated from RRM on site, and informing Bayer of any violations of local, state or federal
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`regulations.
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`February 2021 Discharge Event from AltEn Digester
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`57.
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`On February 12, 2021, a frozen valve failure/blowout on one of the two 4-million
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`gallon capacity anaerobic digesters at the AltEn Facility resulted in the release of thin stillage and
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`manure.
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`58.
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`The discharge of these materials, which was uncontrolled and unpermitted, flowed
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`onto and off the AltEn Facility property into a drainage ditch and onto neighboring properties
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`located as far as 4.5 miles from the digester tank.
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`59.
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`The two 4-million-gallon digesters at the AltEn Facility were designed to produce
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`methane using two inputs: (1) thin stillage from the fermentation process; and (2) manure from the
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`Mead Cattle feedlot.
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`60. Mead Cattle’s permits provided for expected flows into AltEn’s methane digester,
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`and AltEn’s operating permits reflect the receipt of substantial flows of manure from Mead Cattle.
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`61.
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`The material released in February 2021 was black in color, indicating it likely
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`included manure from Mead Cattle.
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`62.
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`Subsequent testing of ten emergency lagoon sludge samples in October 2021
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`showed the presence of animal by-product residues in AltEn’s emergency lagoon. All emergency
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`lagoon samples contained fecal coliform indicating the presence of animal by-product residues,
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`and more than 99% of saturated fat in lagoon samples was from sources other than soil and wet
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`cake.
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`63.
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`On February 17, 2021, the NDEE issued a letter of non-compliance to AltEn,
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`instructing AltEn to undertake efforts to mitigate and clean up the February 2021 discharge from
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`the AltEn Facility.
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`64.
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`On February 20, 2021, after AltEn failed to adequately address the discharge and
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`was otherwise nonresponsive to NDEE’s mandates, NDEE issued an Emergency Order and
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`Complaint (“Emergency Order”) requiring AltEn’s immediate action to mitigate the discharge.
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`The Emergency Order also prohibited AltEn from resuming commercial and industrial operations
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`until the discharge had been sufficiently remediated and would not further threaten or harm public
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`health and the environment.
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`65.
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`On March 1, 2021, Nebraska’s Attorney General filed a Complaint in State court
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`against AltEn in the District Court of Saunders County, Nebraska, for violating the Emergency
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`Order and for violations of the Nebraska Environmental Protection Act (“NEPA”), the Integrated
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`Solid Waste Management Act (“ISWMA”), and permit conditions.
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`Bayer’s Response Following the February 2021 Discharge Event
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`66.
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`Following the February 2021 discharge event, NDEE and the United States
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`Environmental Protection Agency (“EPA”) engaged with Bayer and other Seed Companies and
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`requested assistance in responding to the environmental conditions at the AltEn Facility.
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`67.
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`Due to AltEn’s inability and ineptness to respond to the environmental conditions
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`at the AltEn Facility, Bayer contracted with an environmental remediation firm skilled in
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`emergency response, Clean Harbors, to address the digester release.
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`68.
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`AltEn staff initially oversaw the effort with input from Bayer personnel
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`consultatively.
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`69.
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`Bayer’s role expanded to address NDEE’s directives to AltEn at the request of EPA
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`and State officials.
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 14 of 30 - Page ID # 14
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`70.
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`Initial response efforts focused on drawing down lagoons to safer levels and
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`erecting berms to control storm water runoff from the Site. Bayer incurred and paid costs in the
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`initial response work in February and March 2021 alone of approximately $1.5 Million.
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`71.
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` As Bayer’s role grew, it coordinated with other AltEn seed customers to form a
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`coalition known as the AltEn Facility Response Group (“AFRG”).
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`72.
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`The AFRG signed a Memorandum of Agreement (“MOA”) with NDEE under the
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`Nebraska’s Voluntary Cleanup Program (“VCP”) regarding an interim response and site
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`stabilization measures at the AltEn Facility which the AFRG has been funding to date. Bayer has
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`incurred millions of dollars in additional costs as part of this work.
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`Defendants Abandoned the AltEn Facility, their Cleanup Obligations, and their
`Contractual Duties to Insure and Indemnify Bayer.
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`73. While Bayer has been engaged in response and stabilization activities at the AltEn
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`site, Defendants have not undertaken any efforts to remediate or stabilize the AltEn Facility.
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`74.
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`AltEn began laying off their employees as early as February 2021, and by mid-
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`April 2021, had effectively abandoned the site and its responsibilities.
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`75.
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`AltEn made no efforts to properly decommission the ethanol plant and leave the
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`site in a safe and secure state.
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`76.
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`AltEn has abandoned large quantities of hazardous chemicals and fuel in multiple
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`tanks and piping within the AltEn Facility. These hazardous chemicals include combustible
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`liquids, acids, and high pH materials that may present aquatic, respiratory, and other hazards.
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`77.
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`AltEn has financially abandoned the site, including its debts and obligations to a
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`growing list of vendors, who are now approaching the AFRG to request that the AFRG take over
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`AltEn’s outstanding financial responsibilities. Several contractors have refused to perform work
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`at the AltEn Facility due to nonpayment from AltEn.
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 15 of 30 - Page ID # 15
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`78.
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`AltEn was awarded more than $210,000 in COVID-19 relief money by the
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`Nebraska Department of Economic Development in November 2020, just months before it shut
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`down the AltEn facility and financially abandoned the site.
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`79.
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`AltEn has failed to maintain the property by leaving storm damage unrepaired and
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`not providing site security, weed control, mowing, or snow removal and remains in violation of
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`certain permit compliance requirements.
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`80.
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`AltEn has failed to pay any utility bills and contractors for maintenance of the site,
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`leaving Bayer and the other Seed Companies to pay the gas and electric bills in order to perform
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`the stabilization efforts at the AltEn Facility. The AFRG has also had to assume leases for office
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`buildings and equipment while they stabilize the Site.
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`81.
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`AltEn has failed to pay property taxes for the AltEn Facility site, and on or about
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`February 15, 2022, Saunders County issued a Property Tax Distress Warrant to AltEn in the
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`amount of $23,274.20 for tax year 2021.
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`82. When Bayer presented its demands for indemnification to AltEn, along with
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`invoices paid for February and March 2021 response expenses totaling approximately $1.5 million
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`(only a portion of the total expenses Bayer has incurred to date), AltEn produced a copy of a
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`pollution liability policy (“PLP”) issued by Allied World Assurance Company (U.S.) Inc. (“Allied
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`World”) and represented to Bayer that the policy covered the claims.
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`83.
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`On March 12, 2021, Bayer sent Allied World a written Notice of Claim and
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`Demand for reimbursement of the approximately $1.5 Million expended on the initial site response
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`efforts following the digester spill.
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`84.
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`On October 25, 2021, Bayer learned that AltEn had submitted the Clean Harbor
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`invoices to Allied World as part of its own claim under the PLP, falsely representing that AltEn –
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 16 of 30 - Page ID # 16
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`not Bayer –had incurred the expenses. At the same time, it was revealed that AltEn was actively
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`engaged in a campaign designed to block Allied World from reimbursing Bayer on its claim to the
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`insurance proceeds.
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`85.
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`Bayer and the other Seed Companies have encountered on-going difficulties in
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`obtaining timely and cooperative assistance from AltEn on administrative duties, including, for
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`example, permit applications/renewals required for stabilization activities.
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`86.
`
` One example of AltEn’s obstruction and malfeasance occurred when AltEn
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`personnel showed up unannounced to dismantle and sell-off parts of the bio-char unit. In that
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`process, a protective silt fence around the bio-char unit that the AFRG installed at NDEE’s request,
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`was torn down.
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`AltEn’s, Mead Cattle’s, and Green Disposal’s Improper Transfer of Assets
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`87.
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`AltEn and the other Defendants have been, and continue to be, engaged in a
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`systematic transfer of assets that has the effect of, and appears designed to, deprive creditors of
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`access to assets that would be used to make good on the obligations of AltEn and the other entities.
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`88.
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`To date, AltEn has not contributed to the costs of stabilization at the AltEn Facility,
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`despite being ordered to do so by NDEE, but on information and belief it has utilized contractors
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`to prepare property and equipment for transfer and disposition.
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`89.
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`By June 2021, AltEn had sold more than eighty (80) pieces of equipment and parts
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`used at the AltEn Facility, including semi-trucks, forklifts, stainless-steel piping, and electrical
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`conduit, through BigIron Auctions.
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`90.
`
`On or about February 14, 2022, AltEn representatives removed additional
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`equipment from the AltEn facility to sell at auction.
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`91.
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`AltEn’s retention of auction companies, such as BigIron Auctions, to prepare
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`AltEn’s assets for auction have added to the burden of site response activities for the Seed
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`8:22-cv-00082-BCB-MDN Doc # 1 Filed: 03/02/22 Page 17 of 30 - Page ID # 17
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`Companies. For example, one auction company power-washed equipment that contained treated
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`seed or seed residue without using proper erosion/containment protection, and the wash water
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`flowed into sumps and nearby ditches leading to the emergency lagoon, thereby increasing the
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`volume of wastewater that AltEn has abandoned at the site.
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`92.
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`AltEn’s and Mead Cattle’s contractors have also left a large amount of treated seed
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`on the ground that has been washed off equipment, which itself will need to be managed and will
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`increase the volume of stormwater that requires management.
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`93.
`
`In the spring of 2021, Mead Cattle sold the feedlot property to Champion Feeders
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`of Texas (“Champion Feeders”) for an estimated $22,000,000. Mead Cattle completed this sale
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`over the written objections of Bayer and other Seed Companies.
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`94.
`
`On May 25, 2021, the Saunders County Board granted a conditional-use permit to
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`Champion Feeders to operate the Mead Cattle feedlot.
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`95.
`
`On December 27, 2021, the President of AltEn, Tanner Shaw, notified NDEE that
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`a company in Kansas, B. Cole Agriculture, had purchased and agreed to remove the bio-char from
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`the AltEn Facil