Wednesday, July 22, 2009

More on KSU Plant Variety Protection Infringement Settlement

I mentioned in last week's post regarding a lawsuit filed by South Dakota State University over wheat varieties, a lawsuit that was settled between the Kansas State University (KSU) and defendant farmers. I stumbled upon an article from the Salina Journal of Salina, Kansas that goes into the situation a little more in-depth and I wanted to add a little commentary.

Once again the central tenet behind these large research universities bringing suits is the frustration of neighbors who see the perpetrators as stealing from the community chest. This community chest is funded through public dollars and payments into the Wheat Checkoff program, which has recently gone up to $0.015 per bushel and should generate about another $1.5 million from wheat farmers. This money is needed as states across the country become cash-strapped and the technology demand is increasing in wheat. The overall spending by the University of its budget has went up 3% to 11% over the past 10 years, but the state funding has not been able to keep pace.

An interesting point in the Salina journal article was that some believe that the payments through the checkoff program brings about the mentality that "I already paid for it, so I should be able to do what I want with it." I hope this is not true, since we have all been conditioned to make our annual penitence payment to the IRS and do not demand to be able to do what we want with the public goods such as roads or parks. Through this and other actions of paying taxes, we as a society get the point that somethings you "pay" for are not exclusively yours to exercise your control over at the expense of others.

The increases in expenses and the ability for to make a profit to dump back into research has led many research universities to have closely connected businesses that they will grant exclusive rights to commercialize or outright assign the patent or plant variety protection certificate. This allows for money to be made by the University through the assignment of contractual rights and by a company who now has the right to commercialize and market the technology. It is in these steps that may get many farmers in trouble, as many research universities once upon a time exclusively put out public varieties, which can still be done today after the PVP certificate or patent expires. This was done as the University was to be working in the public trust and therefore should disseminate the product to whoever wants it.

Due to different times and circumstances, I personally believe that this can still be said, the Research Universities are still protecting the public trust through legal protection of their seeds. The legal protections allows a profit to be made, which allows the University research foundations to fund new wheat varieties that can be funneled back out to the farming community. The brown-bagging of seeds could raise the cost, but it could potentially stall research, hence why these certificate owners must protect the varieties and many will contractually hold themselves to do so through exclusive licenses. These actions benefit the farming community as a whole, despite the ugly sound of an organization that works on behalf of the citizen and citizen farmers suing the one of those citizen farmers. In the instant litigation, the complaint alleged that the unauthorized selling of the protected varieties could have led to the harvesting and replanting of 4 million fifty-pound bags of seed within five generations. That is evident how the theft of this technology can put a huge hindrance upon the ability of the creator to generate money upon its invention to make more inventions, much liked a leaked copy of a movie on the Internet will decrease the income of the production company upon the opening in the theaters.

As for the case itself, the details of the settlement, which occurred within a month of filing, were not de minimis in any sense as the the Stockton, Kansas farm family settled for a monetary award of $150,000 with the Kansas Wheat Alliance, Kansas State University Research Foundation and WestBred, LLC who had joined the case as a co-plaintiff due to one of its seed varieties also being sold without authorization. In addition, according to Seedquest, the defendant farmers gave the right to KWA and WestBred (now a Monsanto Co. after a recent acquisition) the right to inspect all of the family farm business and farming records and premises for the next 3 years for possible violations. If any violation is found, the farmers must pay $35.50 for every 50-pound unit of seed they sell. This creates a liquidated damages clause for any future violation and creates a probationary period for the Stockton, KS farm. This will reduce cost on any future claims that may have to be brought on behalf of the Plaintiffs,.

There is an educational effort being brought together by multiple partners regarding protected varieties through the Farmers' Yield Initiative - check it out.

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