Biotech Values

[DewDiligence]

Monsanto Settles Litigation with EU Importers of Bootleg Soy

[The financial terms of the settlement have not been disclosed, but one may presume that MON accepted a token settlement from the European companies who knowingly imported soy meal made from bootleg Roundup Ready soybeans grown in Argentina.

Irrespective of the settled lawsuit, MON has established a bifurcated plan for product introductions in Argentina that includes new varieties of corn but excludes new varieties of soybeans. The distinction is that corn seeds are hybrids and hence they can’t simply be ripped off the way soybean seeds can.

In Brazil, the courts have enforced MON’s IP, allowing MON to collect royalties there when soybeans with MON’s proprietary traits are brought to market—even if the seeds were not purchased from MON or its licensed distributors; in this way, MON is assured of collecting its Brazilian soybean royalties.

In contrast to Brazil, courts in Argentina have been unwilling to enforce MON’s IP, so MON had no choice but to withdraw from selling soybeans there. Insofar as MON will not develop any improved varieties of soybeans—such as those with insect protection or drought resistance—for the Argentina market, Argentina’s soybean farmers are perhaps the biggest losers from their countries cavalier attitude toward intellectual property.]

http://www.reuters.com/article/idAFLDE6641RB20100705

›July 5, 2010 2:04pm EDT

BRUSSELS, July 5 (Reuters) - Monsanto (MON) has withdrawn a legal complaint against European importers of processed soybean meal from Argentina, which the company had claimed breached the EU patent on its Roundup Ready soybean seeds.

Monsanto -- the world's largest seed company -- settled its case against Dutch importer Cefetra and commodities traders Alfred C. Toepfer International, shortly before a European Court of Justice (ECJ) judgment in the case was due on July 6.

"Monsanto, Cefetra and Alfred C. Toepfer International reached an out of court settlement in the case that was subject to the referral to the ECJ. Monsanto has withdrawn its claims," a spokesman for the company told Reuters in an emailed statement on Monday.

Monsanto gave no details of terms of the settlement.

In 2008 a Dutch court asked the ECJ for an opinion on whether the presence of Monsanto's DNA sequence in the soymeal constituted a breach of its EU patent.

The ECJ was widely expected to rule against Monsanto's claim, after a senior court adviser said the company's seed patent should not extend to cover imports of processed soybean meal to Europe in a preliminary ruling in March.

At stake is more than 3 billion euros ($4.03 billion) of annual trade in Argentine soymeal to Europe. The South American country is the world's top soymeal exporter and the EU is its biggest client. Monsanto filed the lawsuit in the Netherlands after its Roundup Ready DNA sequence was discovered in three soymeal shipments from Argentina in 2005 and 2006.

Monsanto has no patent in Argentina, but the majority of farmers there use the company's seeds, which are genetically modified to resist its Roundup Ready herbicide [this refers to the first generation of Roundup Ready soybeans, which is old technology compared to what MON is now selling in the US and hopes to be selling soon in Brazil].

"We continue to believe that the best place for a resolution in these matters is in Argentina, and will continue working with all stakeholders in Argentina for a fair and equitable solution," the company's spokesman said.‹