Deere Repair Investigation Confirmed

18 Oct 2024

LINCOLN, Neb. (DTN) -- The Federal Trade Commission is investigating whether Deere & Company has violated antitrust and/or consumer protection laws in limiting who can repair John Deere equipment.

In March 2022, agriculture groups filed a complaint with the FTC asking the agency to launch an investigation.

Those groups, including the National Farmers Union and state-level farmers unions along with the U.S. Public Interest Research Group, or PIRG, alleged John Deere's practice of withholding diagnostic software and other equipment from farmers violated the Sherman Act.

On Thursday, a Minnesota-based business analytics company filed a petition to attempt to limit the release of information the FTC has requested as part of an ongoing investigation.

In that petition, Hargrove & Associates Inc. said the commission requested access to a database Hargrove owns that includes what it believes is sensitive business information connected with members of the Association of Equipment Manufacturers.

"The stated purpose of the FTC's CID is 'to determine whether Deere & Company, or any other person, has engaged in or is engaging in unfair, deceptive, anticompetitive, collusive, coercive, predatory, exploitative, or exclusionary acts or practices in or affecting commerce related to the repair of agricultural equipment in violation of Section 5 of the Federal Trade Commission Act,'" Hargrove said in its petition.

The FTC has requested access to various data sets and reports relating to agricultural equipment from Jan. 1, 2015, to the present.

That includes what Hargrove said is "confidential information" submitted to the data company from AEM members that reports their sales information to Hargrove's portal.

In addition, the petition said the FTC has requested "confidential market share information" that Hargrove provides to individual AEM members showing each member's respective shares.

"FTC staff have assured counsel that neither HAI nor AEM is the target of the FTC investigation at issue," the petition said.

When contacted by DTN, a spokesperson for John Deere said the company was cooperating with the FTC and cannot comment while the investigation is ongoing.

AG GROUPS' PETITION

The ag groups said in the 2022 petition to the FTC that Deere's practice "constitutes an unfair and deceptive trade practice" and asked the agency to enjoin Deere from continuing the practice.

The groups' complaint alleged it was a violation of the Sherman Act for Deere to make pronouncements about providing diagnostic equipment to farmers and then not delivering the equipment.

PIRG said in a news release on Thursday that the ag groups' original petition was filed based on "research by U.S. PIRG into how Deere prevents farmers from repairing their own equipment, pushing them to use dealership repair services instead."

Until now, it was unclear whether the FTC had launched an official investigation.

"We are grateful that the FTC has taken our complaint seriously and is investigating Deere's conduct," PIRG Right to Repair Campaign Director Nathan Proctor said in a statement.

"We should be able to fix our own stuff. When farmers can't access the proprietary software tools which are required to diagnose or complete repairs, that means they have to wait for an authorized technician before they can finish their work. The weather doesn't wait on a dealership's schedule -- a delay could mean the loss of your harvest."

AEM BOUGHT HARGROVE

The Association of Equipment Manufacturers announced in January 2018 that it had acquired Hargrove & Associates, but according to the Hargrove petition, the two entities have remained separate.

"HAI's business model is built on the trust of the manufacturers that belong to trade associations for which HAI provides services and in the ability of HAI to secure and maintain the confidentiality of their proprietary business information," Hargrove said in the petition.

"Disclosing the confidential data of AEM members would subject HAI to potential claims for breach of contract and unauthorized disclosure of trade secrets and also threatens to undermine trust in HAI among AEM members that submit confidential information to HAI on the condition that it not be disclosed to any third parties without the AEM member's consent."

On Sept. 12, 2024, the AEM provided to the FTC ag tractor and combine monthly reports that showed preliminary monthly retail sales of ag equipment. Then, on Sept. 20, 2024, the AEM provided more aggregated ag industry data to the agency.

Hargrove & Associates said it has held several meetings with the FTC this month, and the agency has extended deadlines for providing the information.

All the while, the company said the FTC has "refused" to limit the scope of the data it has requested.

"HAI has serious concerns about the detrimental effects the overbroad and unduly burdensome CID would have on its business and ability to continue operating," Hargrove said in its petition.

"The FTC may not use its subpoena powers to go on fishing expeditions."

Read the Hargrove & Associates petition here: https://www.ftc.gov/….