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Farmers Launch Anti-Trust Suit Against Monsanto

by A.V. KrebsExtracted from: The Agribusiness Examiner
January 4th, 2000

Six farmers -- from the U.S. and France -- named as representatives of farmers worldwide, under the aegis of the National Family Farm Coalition, in a suit formulated by Cohen Milstein Hausfeld & Toll on behalf of a consortium of other firms, have launched a major anti-trust, price fixing law suit against the Monsanto Corp. and nine corporate co-conspirators (see below).

The farmers -- Bruce Pickett, Atlanta, Indiana; George Higginbottom, Terre Haute, Indiana; C-K Farms, Clear Lake, Iowa; George and Peggy Naylor, Churdan, Iowa, and Patrick de Kochko, Boussac, France -- in a "Class Action Complaint" filed last month in U.S. District Court in the District of Columbia allege that Monsanto and others:

  • Formed a cartel through which it attempted to monopolize the genetically engineered corn and soybean seed markets;
  • Conspired to unreasonably restrain trade in the genetically engineered corn and soybean seed markets;
  • Conspired to fix the prices of genetically engineered corn and soybean seeds;
  • Rushed genetically engineered seeds to market without adequate testing for risks to human health and the environment from such seeds and crops;
  • In 1996, Monsanto devised an anticompetitive scheme to control prices and restrain trade in the genetically corn and soybean seed markets by misusing its intellectual property rights over Yieldgard and Roundup Ready gene technologies;
  • At the same time Monsanto devised its licensing scheme, Monsanto and other major chemical companies commenced a swift series of mergers and acquisitions of competing seed and gene technology companies, which resulted in concentrating virtually all of the genetically engineered production for corn and soybean seeds into the hands of Monsanto and a handful of others, and
  • Since that time, Monsanto and its co-conspirators entered into uniform or near-uniform licensing agreements for Monsanto's technology, with the knowledge and intent that the terms of those agreements were being imposed and effected by competitor-conspirators across the entire genetically engineered corn and soybean seed industry.

Charging that Monsanto's "unlawful conduct in aggregating the power to control all aspects of the production of corn and soy appear to be motivated by its desire to control the basic means of production of the global food supply" the suit also notes that:

  • In support of its attempt to monopolize the genetically engineered corn and soybean seed markets and conspiracy to restrain trade therein, Monsanto's cartel has also: 1) exerted influence over the non-genetically engineered corn and soybean seed markets; 2) pursued legal actions, and engaged in other intimidating conduct, against farmers who are claimed to have violated the Technology User Agreement; 3) made deceptive statements to make genetically engineered seeds appear desirable to farmers making purchasing decisions; and 4) failed to carry out adequate human health and environmental safety testing pre- or post-marketing.
  • In the international marketplace, Monsanto and its co-conspirators engaged in conduct paralleling their conduct in the United States markets, including, 1) attempting to monopolize the international genetically engineered corn and soybean seed markets; 2) acting in unreasonable restraint of trade in the international genetically engineered corn and soybean seed markets; 3) consolidating control of the international genetically engineered corn and soybean seed markets into the hands of the cartel through mergers and acquisitions for the purpose of restraining trade; and 4) engaging in the international imposition of excessive "technology fees" upon farmers.

The suit notes that "members of the cartel have even threatened to withhold non-genetically engineered seeds from farmers in countries where authorities that refuse to accept the cartel's genetic engineering technology, and have also promoted certain insect resistant genetically engineered seeds in farming regions where there is no need for that particular insect resistance."

In launching their suit the farmers are seeking treble damages, compensatory and punitive damages and injunctive relief under the antitrust laws of the United States, the common law, and customary international law, and are demanding a jury trial.

Assisting Cohen Milstein Hausfeld & Toll, Washington, D.C., on a no-win, no-fee basis, are the law firms of Lieff, Cabraser, Heimann, San Francisco, California.; Pomerantz, Haudek, Block, Grossman & Gross, New York, New York.; Spector & Roseman, Philadelphia. Pennsylvania; Meredith, Cohen, Greenfogel & Skirnick, New York, New York.; Kaplan, Kilsheimer & Fox, New York, New York; Heins, Mills & Olson, Minneapolis, Minnesota; Cohen & Malad, Kinston, North Carolina; White & Allen, Indianapolis, Indiana, and Law Offices of Liebenberg & White, Jenkinstown, Pennsylvania. Also assisting in the case is the Foundation on Economic Trends.

Co-Conspirators Named in Monsanto Price-Fixing, Anti-Trust Suit

Those corporations named as co-conspirators in the recent law suit filed against the Monsanto Corp., for price fixing and engaging in anti-trust activities, by six farmers from the U.S and France include:

  • DELTA AND PINE LAND COMPANY: A seed company that had agreed to merge with Monsanto, pending approval of the United States Department of Justice. Delta and Pine Land sells genetically engineered cotton and soybean seeds.

  • E.I. du PONT de NEMOURS and CO.: A global chemical, materials, and energy company with total sales of approximately $46 billion in 1997. DuPont's Agricultural Products segment sells herbicides, pesticides, and fungicides, and is also active in the agricultural genetically engineered seed market.

  • PIONEER HI-BRED INTERNATIONAL, INC.: A wholly owned and controlled subsidiary or division of DuPont. In 1998, Pioneer alone controlled an estimated 42% of the corn seed market, and an estimated 16% of the soybean seed market, in the United States. Pioneer also sells genetically engineered soybean and corn seeds.

  • DOW CHEMICAL COMPANY: A large, diversified worldwide producer and supplier of chemicals, plastics, and agricultural products. Dow Chemical participates in the genetically engineered corn and soybean markets through its subsidiaries identified below.

  • MYCOGEN CORPORATION and MYCOGEN PLANT SCIENCES, INC.: A wholly-owned and controlled subsidiary or division of Dow Chemical. Mycogen participates in the seed industry in part through its wholly-owned subsidiary corporation, AGRIGENETICS, INC., MYCOGEN SEEDS. Mycogen estimates that Agrigenetics ranks fourth in the United States in the sale of seed corn. Mycogen also sells genetically engineered soybean and corn seeds.

  • NOVARTIS INTERNATIONAL, AG, together with its wholly-owned and controlled subsidiary or division NOVARTIS SEEDS, INC.: Produces seeds for a variety of crops including corn, sugar beets, and oilseeds. Novartis sells seeds in the United States through its "NK" division, which was formerly an independent seed company known as Northrup King Co. prior to its acquisition. Novartis sells genetically engineered soybean and corn seeds.

  • ASTRAZENECA, PLC : A food biotechnology company that specializes in corn, wheat, rice, and other crops. ZENECA, INC., is the American arm of AstraZeneca.

  • GARST SEED COMPANY: A 50%-owned and controlled subsidiary or division of AstraZeneca. Garst sells genetically engineered soybean and corn seeds.

  • AGRIPRO SEEDS, INC.: A wholly owned and controlled subsidiary or division of AstraZeneca. AgriPro sells genetically engineered soybean and corn seeds.

NFFC President Christison Hails Monsanto Anti-Trust Suit as "Historic"

Characterizing six farmers and the National Family Farm Coalition's recently announced anti-trust lawsuit against Monsanto as "historic," NFFC President Bill Christison noted that "as a Missouri family farmer I can tell you that the farmers and consumers of the world have been sold a bill of goods because genetically engineered organisms do not perform as advertised.

"The truth is, genetically engineered crops cost more and yield less. There are four areas of concern farmers and consumers have about genetically engineered crops. They include the health, the environment, social and economic aspects," he added.

Christisen pointed out that while genetic engineering is a relatively new technology in the countryside, groups like the NFFC have been working on its issues for years. On November 30, over 30 family farm and rural organizations joined together to release a Farmer's Declaration on Genetic Engineering. In Seattle during the recent World Trade Organization ministerial meetings, the issue of genetic engineering was a major focus of discussion within the Via Campesina, an international network of family farm and peasant organizations of which the NFFC is a member.

In their suit the farmers and NFFC charge that Monsanto and other "life science" companies have rushed genetically engineered crops, like corn and soybeans, to market without proper testing to determine long-term effects of their new creations.

Corn and soybeans are two staple food crops which are essential to the United States and global food supply. In 1998, the United States market for soybeans was estimated at $17.7 billion. In 1999, the United States market for corn was estimated at $20 billion. Yet, in 1998 alone, the European Union reduced its import of U.S. corn from 70 million bushels to three million bushels, resulting in a loss of export income to U.S. farmers of an estimated $200 million.

"The efforts of Monsanto and their co-conspirators," Christison charges, "has been to flood the world with seeds that produce products consumers do not want to eat. In addition, there genetically engineered crops are contaminating the entire food chain. We demand USDA to stop funding terminator type technologies and instead urge them to allocate these funds to land grant universities to better fulfill their mandate to provide public variety seeds at no cost to the farming community."

"Contrary to the USDA's position that genetic engineering is necessary to feed the world, today we have a world that is awash in surplus grain resulting in record low farm prices," he added.

"Today, Monsanto and its co-conspirators have a monopoly over our food system. Their operations threatens world food security. This litigation exposes their practices. A victory in this lawsuit will allow the family farmers of the world to retain ownership of their seeds, their farms, and produce a food supply that is safe, adequate, and reasonably priced for all consumers."

The NFFC, in announcing the lawsuit, also welcomes and urges other farmers and farm organizations to join in the complaint. Interested parties should contact the NFFC in Washington, D.C. at 1-800-639-3276.

The NFFC is a membership based organization comprised of 32 family farm and rural advocacy organizations in 30 states and was founded in 1986. NFFC works on issues to ensure the survival of family farmers and to promote the increased economic viability of our nation's rural communities.