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Monsanto sued by five million Brazilian farmers for 6.2 billion Euros
by Joseph Earnest June 4, 2012
Newscast Media NEW YORK—Biotech giant Monsanto is facing a lawsuit by five million Brazilian farmers who say that the company is unjustifiably collecting royalties on crops it claims to own but doesn't. The lawsuit seeks almost 6.2 billion Euros in damages. Monsanto, a company that genetically engineers crops, is very influential and has been successful in winning lawsuits or having them thrown out by judges.
According to Merco Press, farmers claim that Monsanto unfairly collects exorbitant profits every year worldwide on royalties from "renewal" seed harvests. Renewal crops are those that have been planted using seed from the previous year's harvest. While the practice of renewal farming is an ancient one, Monsanto disagrees, demanding royalties from any crop generation produced from its genetically-engineered seed. Because the engineered seed is patented, Monsanto not only charges an initial royalty on the sale of the crop produced, but a continuing two per cent royalty on every subsequent crop, even if the farmer is using a later generation of seed.
"Monsanto gets paid when it sell the seeds. The law gives producers the right to multiply the seeds they buy and nowhere in the world is there a requirement to pay (again). Producers are in effect paying a private tax on production," Jane Berwanger, lawyer for the farmers told the press. (pop-up)
The first transgenic soy seeds were illegally smuggled into Brazil from neighboring Argentina in 1998 and their use was banned and subject to prosecution until the last decade, according to the state-owned Brazilian Enterprise for Agricultural Research (EMBRAPA). The ban has since been lifted and now 85 percent of the country's soybean crop (25 million hectares or 62 million acres) is genetically modified, according to Alexandre Cattelan, an EMBRAPA researcher.
In April, a judge in the southern Brazilian state of Rio Grande do Sul, Giovanni Conti, ruled in favor of the producers and ordered Monsanto to return royalties paid since 2004 or a minimum of $2 billion. The ruling by Judge Giovanni Conti also provides for the reimbursement of license fees paid (so‐called royalties) since the harvest campaign 2003/2004, as the business practices of seed multinationals Monsanto violate the rules of the Brazilian Cultivars Act (No. 9.456/97). Monsanto appealed and a federal court is to rule on the case by 2014. Add Comments>>
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