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Growers in certain states may be able to claim as much as $6,000 from a class action settlement with the Burley Tobacco Growers Cooperative Association (BTGCA) that puts to rest some claims the organization breached its duties to members.
Class Members include those who grew burley tobacco in Indiana, Kentucky, Missouri, Ohio or West Virginia between 2015 and 2020.
The plaintiffs — landowners, tenants and others who grew the tobacco — alleged the BTGCA ceased functioning for the benefit of its members.
The organization was formed in 1922 under the Bingham Act. According to the BTGCA’s website, the organization is meant to help members remain profitable and stable. The BTGCA says it promotes the business of marketing tobacco, and, to that end, the organization purchases and stores excess crop from members to be sold at a later date.
However, the plaintiffs say the BTGCA has been mismanaged to the detriment of members.
According to the complaint, the BTCGA began stockpiling burley tobacco and stopped buying from members — a violation of its Articles of Incorporation. In addition, the class action lawsuit alleged the organization failed to meet other obligations, citing a study by The Ohio State University.
The alleged failures included:
- Purchasing burley tobacco from less than 10% of the growers
- Offering less to BTGCA members than other growers
- Increasing inventory by $16 million over five years
- Purchasing and selling that resulted in a net loss
- Failing to maintain equity membership accounts
- Failing to communicate with members
- Failing to provide required articles on operating costs, apportionment of proceeds, equity records, refunds, reserves and dissolution procedures
In addition, the plaintiffs claimed that despite operating at a loss, the BTGCA spent approximately $1 million each year on operating costs, including staff and offices, and to maintain the multimillion-dollar tobacco inventory it had accrued.
The class action lawsuit contended that the BTGCA hid the state of the organization from members in order to continue operating in a way that wastes assets. The plaintiffs claimed the BTGCA worked in the interest of its board and staff and not its members — burley tobacco growers suffering from the continuing decline in demand for tobacco.
Indeed, the class action lawsuit called for the dissolution of the organization.
The BTGCA refused to admit any wrongdoing, but agreed to dissolve and distribute net assets to Class Members under the terms of a settlement agreement; however, the class action settlement only partially ends the litigation. Class Members who have claims not related to the dissolution of the BTGCA can proceed.
Under the terms of the class action settlement, the organization’s assets will be sold and used to pay off any debts it owes. According to settlement documents, an estimated $28 million in remaining assets will then be used to do the following:
- Establish a nonprofit tobacco liaison and advocacy organization
- Pay court costs
- Award plaintiffs
- Pay attorneys’ fees
- Pay Class Member awards estimated to be between $2,000 and $6,000 each
The BTGCA maintained a database of members and has identified Class Members from those records. Class Members should verify they are included by checking the settlement website by Jan. 29, 2021. Class Members who are not included will need to provide documentation of BTGCA membership during a 2015-2020 growing season, including a FSA form 578, evidence of federal crop insurance, or signed contract, bill of sale, check stub or bank deposit. Documentation is due by Jan. 29, 2021.
In addition, all Class Members must submit a Form W-9 either online, by fax, or mail. Form W-9 must also be submitted by Jan. 29, 2021.
The deadline to object to the settlement agreement is Jan. 29, 2021. The final hearing is scheduled for Feb. 24, 2021.
Who’s Eligible
Class Members include those who grew burley tobacco in Indiana, Kentucky, Missouri, Ohio or West Virginia between 2015 and 2020.
Potential Award
Between $2,000 and $6,000.Â
Proof of Purchase
All Class Members will need to submit a Form W-9.
Class Members not included in the membership database will need to submit proof of membership in the BTGCA for a 2015 to 2020 growing season, including any of the following:
- FSA form 578
- evidence of federal crop insurance
- signed contract, bill of sale, check stub, or bank deposit
Claim Form
NOTE:Â If you do not qualify for this settlement do NOT file a claim.
Remember: you are submitting your claim under penalty of perjury. You are also harming other eligible Class Members by submitting a fraudulent claim. If you’re unsure if you qualify, please read the FAQ section of the Settlement Administrator’s website to ensure you meet all standards (Top Class Actions is not a Settlement Administrator). If you don’t qualify for this settlement, check out our database of other open class action settlements you may be eligible for.
Claim Form Deadline
01/29/2021
Case Name
Haynes Properties LLC, et al. v. Burley Tobacco Growers Cooperative Association, Case No. 20-CI-332, in the Fayette Circuit Court, Fourth Division, in Lexington, Kentucky
Final Hearing
2/24/2021
Settlement Website
Claims Administrator
BTCGA Settlement Administrator
1650 Arch Street
Suite 2210
Philadelphia, PA 19103
info@BTGCASettlement.com
1-855-965-5569
Class Counsel
Katherine K. Yunker
Jason R. Hollon
MCBRAYER PLLC
Defense Counsel
Jeremy S. Rogers
DINSMORE & SHOHL LLP
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