Harter v. Iowa Grain Co.
United States Court of Appeals for the Seventh Circuit
220 F.3d 544 (2000)
Lowell Harter (plaintiff), a farmer, entered hedge-to-arrive (HTA) contracts with The Andersons (Andersons), a grain elevator company, for delivery of corn. The contracts included an arbitration provision for disputes to be resolved by the National Grain & Feed Association (NGFA). On the agreed delivery date, commodity prices changed in favor of Andersons. Andersons sought delivery of the corn, or cash equivalent, and payment for the price difference from Harter. Harter refused, claiming he was told there was no risk of price fluctuations. Andersons claimed that the risk of loss was apparent in the transaction based on the difference between the contract price and future market price. Harter sued in district court, alleging violations of the Racketeer Influenced and Corrupt Organizations Act and the Commodity Exchange Act and bringing fraud and contract claims. Andersons’s motion to compel arbitration was granted. The NGFA entered an award in favor of Andersons. Harter moved to vacate the award, arguing that the NGFA was structurally biased against farmers and impartial because its members included grain elevators, employees of Andersons, and HTA drafters. Andersons moved to confirm the award. The district court confirmed the award, and Harter appealed.
Rule of Law
Holding and Reasoning (Cudahy, J.)
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