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Seed piracy A risky bet

Saving and planting patented seed is a risk some growers are willing to take. But those caught are now wishing they hadn't gambled.

Last year, Reed, KY, grower David Chaney saved some of the soybean seed he harvested on his soybean, corn, wheat and milo farm. This was normal practice for the retired tool-and-die maker turned farmer. However, last year Chaney planted Roundup Ready soybeans. He knew it was against the law to save and replant seed containing patented technology, like Roundup Ready soybeans, but he decided to risk it and replant all of the soybean seed he had saved anyway.

"I've been in this business for a long time," Chaney says. "I know the law. I keep up with the news, and, like breaking the speed limit, I knew what I was doing was wrong." Chaney also acknowledged that in return for other goods, he illegally traded the pirated seed with neighbors and an area seed cleaner for the purpose of replanting. All of those people were implicated when Monsanto, the owner of Roundup Ready patents, discovered Chaney's dealings this season.

Heavy toll. Now each party is settling with the company. Chaney's settlement agreement includes $35,000 in royalty payments as well as full documentation confirming the disposal of his unlawful soybean crop. Chaney and the others involved will make available all of their soybean production records, including Farm Service Agency/ASCS records, for Monsanto's inspection over the next five years. They also will provide full access to all of their property for inspection, collection and testing of soybean plants and seed for the next five years.

"Obviously, we've dealt with some farmers who have saved a little seed and some who have saved quite a bit more - and that's one of the things that certainly determines the range of settlements," says Lisa Safarian, Monsanto's business development manager for intellectual property. "I would say, almost without exception, every case has included payments of $10,000 on up. And we have some pending cases that will require significantly larger amounts to be paid by the guilty party.

"In addition to monetary settlements, we have almost a dozen other parameters that can be implemented, aside from the multiyear field inspections and multiyear business record inspections," Safarian explains. "In some cases, we've had situations where we actually had the illegal crop destroyed. Or we've confiscated brown-bagged seed. And we've had farmers selling illegally saved seed, or trading it for goods and services. And when sold, the farmer not only violates patent law, but also plant variety protection acts."

Chaney is not sure how Monsanto detected the pirated seed. "Someone must have called me in because Pinkerton agents came to my house," he says. Monsanto has hired Pinkerton Investigative Services to investigate suspected piracy of its patented biotech seeds.

Signature matter? To farmers who think they cannot be held accountable if they don't sign the grower agreement or the order/invoice, the company says think again. "It's against the law to save seed containing patented technology, period, even if the agreement or the order/invoice was not signed. In Chaney's case, he signed nothing," Safarian says.

"The whole reason that we have the statement on the order/invoice is to explain that the crop is good for one growing season only. We like farmers to initial it so we know they actually read it and understand the terms of purchasing this product. We are not limited in enforcing our patent if he does not sign the agreement," she adds.

For the past two years, Monsanto has led an aggressive, ongoing communications campaign to educate farmers and others that it is illegal to save and replant seed containing patented technology. Monsanto also has offered incentive programs such as the Technology Value Package, which includes crop loss and replant refunds to growers who purchase Roundup Ready soybean varieties.

No stone unturned. The company vigorously pursues anyone who pirates any brand or variety of its genetically enhanced seed, such as Roundup Ready soybeans and cotton and Bollgard cotton. To date, Monsanto has more than 475 seed piracy cases nationwide, generated from more than 1,800 leads. Currently, more than 250 of these cases are under investigation in midwestern and southern states, including Iowa, Illinois, Indiana, Kansas, Kentucky, Michigan, Minnesota, Missouri, North Carolina, Nebraska, Ohio, South Carolina and South Dakota. According to Scott Baucum, intellectual property protection manager for Monsanto, the company "steadfastly follows up on every lead. We've had people from all parts of the chain turn people in, anonymously and otherwise - other farmers, seed cleaners, dealers, applicators." More cases have been settled outside the courtroom than inside. Baucum says Monsanto prefers to settle out of court, which is how it settled the Chaney case, but it will bring a violator into court if necessary to protect its intellectual property.

Monsanto is resolute about publicizing its position on seed piracy. "It's a matter of protecting future technologies," Baucum explains. "Monsanto has invested many years and millions of dollars in research to bring farmers new technologies sooner rather than later." And when growers pirate seed, Baucum says, "there is definitely less incentive for companies to invest in future technologies. These technologies include seeds that produce high-yielding crops, drought-tolerant crops, crops that are protected against insects such as corn rootworm, cyst-nematode-protected soybeans and crops with high-value components, such as modified oil or bran."

Until now the investigations and settlements have been kept confidential. Why did Monsanto release the details of Chaney's case?

"We've heard from a lot of growers," Baucum says. "They want to know what we're doing to keep a level playing field for them. They want to know the details regarding those offenders caught illegally saving and replanting pirated seed. Each case is unique in how it is handled."

Catch 22? Baucum says Monsanto is concerned about its image among farmers.

"We understand that these people are our customers," he says. "And we want to treat them carefully, but we also feel it's important to represent the vast majority of farmers who follow the law. Are we going to allow people who break the law to put the development of new technology at risk?"

What effect does Chaney believe knowledge of his case will have on his neighbors?

"I'm going to tell you the truth," he states. "This is what can happen to you if you save and replant (this seed). It's the law, and whether or not you agree with it, you have to support it."

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