Farmers who sold corn to bankrupt ethanol producer VeraSun Energy Corp. have been receiving letters asking them to pay back their revenue due to "bankruptcy preference."
The Iowa State University's Center for Agricultural Law and Taxation says the letters apply to growers who sold corn to VeraSun in the 90 days before it filed for Chapter 11 bankruptcy protection. The growers are told they have until Sept. 30 to repay 80 percent of what VeraSun paid them for their corn.
National and state corn growers associations said Thursday their members might have a defense and should consult with an attorney.
Sioux Falls-based VeraSun filed for bankruptcy in October 2008 after tightening credit markets erased its lifeline to weather the swings in corn and fuel prices.
