LINCOLN, Neb. (DTN) -- Even as Omaha-based Hansen-Mueller Co. faced insolvency in late 2025, the company continued to accept grain deliveries from Texas farmers and gave no indication of the company's financial difficulties to those producers, according to court documents filed in the U.S. Bankruptcy Court for the District of Nebraska.

As a result, two Texas farmers argue in court that they should be paid for deliveries of winter wheat and corn totaling more than $230,000 or recover the grain from Hansen-Mueller.

In making the arguments in the ongoing Chapter 11 bankruptcy case, Elliott AGCO and Kyle Miller presented what they believe is evidence that Hansen-Mueller misrepresented their insolvency within three months before the grain was delivered.

Under federal law, when a buyer like Hansen-Mueller receives goods while insolvent, the seller normally has just 10 days after delivery to make a written demand to reclaim their goods.

The Texas farmers missed the 10-day window and claim in court documents that they had no idea Hansen-Mueller was insolvent when they delivered grain.

Federal law includes an exception to the 10-day window: if a misrepresentation of solvency is made to a seller in writing within three months before delivery, the 10-day window does not apply.

In May 2026, the court ruled against 19 Texas farmers in their bid to recover more than $700,000 in grain claims submitted to Hansen-Mueller. The court ruled the farmers' liens against the company were not perfected. However, the court left open the possibility for the producers to fully recover the proceeds through reclamation -- a procedure to potentially recover the grains delivered to Hansen-Mueller.

ELLIOTT AGCO, KYLE MILLER

Elliott AGCO and Kyle Miller were part of the 19 Texas producers who made claims under Texas law in the Nebraska court. They were the only two farmers who asserted reclamation rights to the grain they delivered and were given until June 5, 2026, to submit evidence of misrepresentation of solvency.

However, although the bankruptcy court did not require it, fellow Texas producers Golden Harvest Farms, LLC and Elm Creek Commodities, LLC also submitted evidence to the court to support the claims made by Elliott AGCO and Kyle Miller.

All four farms submitted copies of emails, text messages and phone calls they exchanged with Hansen-Mueller representatives when they were seeking payment from the company for grain deliveries in October and November 2025.

Based on DTN's review of the messages, Hansen-Mueller representatives did not inform the farmers about the company's financial difficulties even though the company filed for Chapter 11 on Nov. 17, 2025.

Brian Koenig, an attorney representing Hansen-Mueller in the bankruptcy proceeding, told DTN he believes the accusations leveled by the farmers are not true.

"We believe the allegations are factually inaccurate, as it is clear from the documents produced that no one from Hansen-Mueller induced any farmer into delivering grain with a representation of solvency," he said.

"Accordingly, the law upon which the Texas Producers base their claims does not afford them the remedy they seek. Hansen-Mueller Co. intends to file a response with the court demonstrating why the claims of the two Texas producers fail, just like those of the other producers whose Section 557 claims have been disallowed."

Miller said in his affidavit that he wouldn't have delivered grain to the company had he known it was facing insolvency.

"Hansen-Mueller's misrepresentations of solvency, together with its actions and omissions as reflected in the attached exhibits, created and reinforced my belief that the company was solvent and capable of paying for my grain," Kyle Miller said in an affidavit filed with the court.

"In particular, the representations made before my yellow corn deliveries induced me to proceed with those deliveries despite the fact that I had not yet been paid for my wheat. However, it has been revealed in this bankruptcy case that Hansen-Mueller was operating under forbearance agreements with BMO Bank for at least two months prior to filing for bankruptcy; therefore, those representations of solvency were false when made. Yet, Hansen-Mueller continued to act as if they were going to pay and solicited my business. Had I known that Hansen-Mueller was insolvent or unable to timely pay for my grain, I would not have made those yellow corn deliveries."

Golden Harvest Farms operated by Cody Pruser in Runnels County, Texas, said in an affidavit that he was not filing for reclamation of his grain delivered to Hansen-Mueller but did not give a reason.

Rather, he told the court that he believes Hansen-Mueller's "misrepresentations" regarding its solvency were not limited to a couple of farmers.

"Based on my dealings with Hansen-Mueller concerning Golden Harvest's deliveries, I believe that Hansen-Mueller's acts and omissions, delays and failure to respond to my inquiries regarding payment constituted a misrepresentation of solvency to Golden Harvest," Pruser told the court.

"Based on the information surfaced so far, I believe such misrepresentations by Hansen-Mueller were not an isolated instance limited to my case but were part of a widespread pattern affecting numerous grain producers."

PRUSER PHONE CALL

Pruser said he was able to reach Hansen-Mueller president Tyler Kester on Oct. 17, 2025. During a phone call with Kester, Pruser said he was never told about the company's insolvency.

"I was told he was not aware of what was going on (about Pruser not being paid) but he would look into it," Pruser said in the affidavit.

"I forwarded him an Excel document with all of our unpaid grain tickets. He called me back within the hour and told me that they would check out that day, which was a Friday or Monday at the latest. He stated that taking that long to pay producers was unacceptable and he would look into it. He also said it was possible because two of the buyers we dealt with both had quit, as well as they had gone to a new payment system with the bank that there was a delay in payment."

Read more on DTN:

"19 Texas Farmers Denied Grain Claims," https://www.dtnpf.com/…

Todd Neeley can be reached at todd.neeley@dtn.com

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