Dive Brief:
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Deere & Co. must face a lawsuit brought by the U.S. Federal Trade Commission alleging that the tractor maker forced farmers to use its authorized dealers for parts and repairs, a federal judge ruled last week.
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Judge Ian Johnston found enough support within the plaintiffs’ arguments, brought forth by the FTC and five other states alleging anticompetitive behavior, to deny Deere’s effort to end the lawsuit, according to a 27-page order filed June 10 in the U.S. District Court for the Northern District of Illinois, Western Division.
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The ruling clears the way for a trial expected to begin later this year, but a date has not been set yet. Deere sought to dismiss the complaint in March after claims were brought against the company in mid-January, during the end of the Biden administration.
Dive Insight:
The FTC’s lawsuit stems from growing concerns that Deere and other original equipment manufacturers are restricting consumers’ ability and right to repair their own equipment.
If Deere is found liable, the company may be forced to change its repair policies and make its resources more available to customers.
Apple, which faced lawsuits in California over consumers’ ability to repair their phones and electronics, has since taken steps to make the same parts, manuals and tools used at Apple stores also available to consumers. Last month, the company expanded its self-service program to include iPads, as well as previous models of Mac computers and iPhones.
According to court documents, Deere allegedly drives up the cost of repairs and parts by forcing farmers to get their equipment serviced through its authorized dealer network rather than through independent shops, contractors and farmers. The dealers have exclusive access to an interactive software that can diagnose and fix tractor computer issues.
Another version of Deere’s software is accessible to independent parties, but the FTC argues the option is inferior and limited in scope.
“Farmers have no alternatives because of the system created by Deere, which charges supracompetitive prices because of the lack of any alternatives,” Johnston wrote in his order, citing FTC’s allegations.
Once farmers are in the door, the dealers can sell parts that are comparable to generic, cheaper versions, but higher in price. This behavior is unlawful, drives up farmer costs and yields “massive profits” for Deere and its dealers, the plaintiffs allege.
The FTC filed the original lawsuit, along with attorneys general from Arizona, Illinois, Michigan, Minnesota and Wisconsin. They allege that Deere is behaving as a monopoly and in violation of the Sherman Antitrust Act, which promotes competition in the marketplace.
Deere has repeatedly denied the allegations and sought to dismiss the case and other similar disputes. In 2022, a group of farmers filed a class-action suit in the same court with the same underlying issue. Its claims were later combined with the FTC’s lawsuit.
