SD PUC fines Massachusetts-based company $15,000

PIERRE, S.D. (KELO) — A Massachusetts-based company that specializes in buying a specific type of oil seed from farmers now faces a $15,000 civil penalty in South Dakota.

The South Dakota Public Utilities Commission imposed the punishment against Yield10 Bioscience Inc. of Woburn, MA, after an evidentiary hearing on Friday. Yield10 was notified of the complaint and the proceeding but wasn’t represented.

The commission found that Yield10 had failed to provide notification that the company was no longer in compliance with financial conditions required for South Dakota-licensed grain buyers and didn’t provide information within five days that was requested by the commission’s staff.

Each set of violations carried a maximum civil penalty of $20,000, for a possible total amount of $40,000. Commission chair Kristie Fiegen proposed $15,000.

“Our goal at the PUC is to make sure our producers are protected, and we want answers right away,” Fiegen said. “Producers were not impacted, but they could have been.”

Commissioner Chris Nelson asked why she chose $15,000. “I don’t think we should do the maximum, because no one was hurt,” Fiegen explained.

Nelson said he could have gone higher. Fiegen encouraged him to suggest more.

The third commissioner, Gary Hanson, however said he would have suggested $5,000 on each violation for a total of $10,000.

“So it sounds like a sweet spot,” Hanson said about the $15,000.

The commission voted 3-0 for that amount.

Fiegen and Nelson recognized the staff for its work.

“These are not easy,” Nelson said. “You shouldn’t had to have to go through all the work on this.”

During the hearing, grain-warehouse division manager Cody Chambliss presented information about the staff’s interactions with Yield10, including their exchanges of emails and correspondence.

Chambliss said the company buys camelina, an oil seed that is rarely grown in South Dakota. He said the company claimed it never purchased camelina from South Dakota producers.

A news release issued by Yield10 on Wednesday night said the company’s assets were being purchased by the seed technologies platform of Nufarm Limited, an Australia-based company.

Nelson said the commission asked the Legislature for the two statutes in 2013 after “the Anderson Seed fiasco” in 2012 that saw a sunflower buyer go bankrupt.

Chambliss said the statutes had been used to levy a civil penalty once since then. That matter involved H&I Grain in 2017. When asked for his recommendation, Chambliss said a minimum of $5,000 for each of the two violations and upward to $10,000 for each.

“We’re fortunate here there weren’t any producer losses,” Chambliss said. He said it’s “very rare” that a company can suffer a financial loss and not have losses incurred by producers.