Plant Patent Protection
Pepsi has sued four farmers in India for growing potatoes which are protected in India under the Protection of Plant Variety and Farmers Right Act (PPV). The PPV was enacted in 2001 and was supposed to be pro farmer. Under the PPV, registration of a plant variety provides exclusivity to produce, sell, market, distribute, import or export the plant. On the other hand, one provision of the PPV, provides farmers freedom to save, use, sow, resow, exchange, share or sell their produce including seed which is otherwise protected under the PPV.
Pepsi’s Contract with Farmers
Pepsi set up R&D farms in India in 1989 to produce potatoes which are supplied to farmers across India and even exported to other countries. The farms who obtain the plantings provide potato seeds and cultivated potatoes to Pepsi. Over 50% of the company’s potatoes come from farmers who produce potatoes under contract to Pepsi. However, as part of their contact, these farmers cannot:
(i) sell or dispose the Pepsi potato seeds or multiplied chip grade potatoes to any person or company other than to Pepsi; or
(ii) use the Pepsi potato seeds, for any purpose, other than farming under the terms of this Agreement.
In addition, Pepsi’s contracts also prevents the farmer’s from selling their potatoes or potato seeds on the open market, unless Pepsi has more than it can use and the farmers have produced more than expected.
Plant Patent Lawsuit
According to lawsuit filed by Pepsi, the farmers reused seeds from other potatoes and infringed Pepsi’s rights. To gain protection for their potatoes, in 2016 Pepsi applied for an India plant patent, covering a variety of potato. As a result of their application, Pepsi obtained a certificate of registration in India which provides exclusivity to Pepsi for 15 years to produce, sell, market, distribute, import or export the potato.
Based on the lawsuit, the farmers were apparently producing and selling potatoes covered by Pepsi’s plant patent. Specifically, the farmers were buying seeds from local dealers or they were simply growing them from seeds generated naturally from other plantings. Thus, the farmer’s were not obtaining the seeds or potatoes in question from Pepsi.
The case raises two important questions:
Can Pepsi claim the right to prevent mother nature from producing potatoes or potato seeds?
Are farmers liable for infringement if mother nature makes seeds and/or potatoes from other potatoes?
Stay tuned for the answer…