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monsanto and dupont go hand to hand

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#1 Rail Paul

Rail Paul

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Posted 13 March 2010 - 11:35 PM

Bloomberg has an article today about the litigation against monsanto on its roundup ready seed materials. These patented corn, soybean, wheat etc seeds are genetically modified to resist certain diseases, and to react positively to the use of the patented roundup pesticide. DuPont argues that Monsanto has a monopoly on something customers need, which disadvantages DuPont. The US Justice department, under pressure from farm state legislators, is looking into the situation.

The issue is clouded by the long judicial deference to patents in the US. The courts don't like to modify or limit patents, and as recently as the Microsoft case allowed patents to stand.

‘Robust Patent System’

“There is a very robust patent system in this country and if you are abusing a patent to extend or maintain a monopoly, that is not legal,” Varney said. “We are looking at those very important issues.”

The department probably is reviewing whether Monsanto’s licensing restrictions on seeds have a legitimate business justification, said Rule, who occasionally advises Monsanto and isn’t working with Webb on the antitrust case.

“When you have that sort of monopoly power, it can lead to abuse, which is what we’ve been experiencing over the past several years,” said Thomas L. Sager, DuPont’s general counsel.

Wilmington, Delaware-based DuPont claims Monsanto protects its lead in biotech seeds, including the Roundup Ready seeds sold since 1996, by controlling whether competitors can add their own genetics.

Roundup Ready 2 Yield

Monsanto also has begun switching seedmakers and growers from Roundup Ready soybeans to the newer Roundup Ready 2 Yield version in advance of the original’s patent expiration in 2014. DuPont says Monsanto is using incentives and penalties to switch the industry to the new product in a way that unlawfully extends the Roundup Ready monopoly.

“This is about trying to obtain a level playing field so innovators can introduce combinations of choices to the farmer that increase yield and of course feed the world,” Sager said.

At least seven states are investigating many of the same claims, as well as whether Monsanto illegally offered rebates to distributors who limit sales of competing seed, according to one person involved in the probe who asked not to be named because he isn’t authorized to discuss it.

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