Monsanto Wins Round One In Roundup Ready Dispute

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Monsanto Co. said Jan. 19 a federal court had ruled in its favour in a bitter dispute with key rival DuPont, finding DuPont had violated a licensing agreement in trying to combine certain genetic seed traits developed by Monsanto with its own.

DuPont officials said the court decision was “narrow” allowing them to continue to press anti-trust allegations against Monsanto, the world’s largest seed company, while not deterring plans to commercialize a new soybean seed later this decade.

“We’re going to move ahead because the case isn’t over yet,” said DuPont spokesman Doyle Karr.

Monsanto sued DuPont last May, saying its agricultural unit, Pioneer Hi-bred International, was acting outside the scope of a licensing agreement by combining Monsanto’s Roundup Ready genetic trait with DuPont’s Optimum GAT genetic traits in corn or soybeans.

Monsanto claimed DuPont wanted to use the Roundup Ready trait to mask problems with the effectiveness of DuPont’s Optimum GAT trait in a new soybean seed.

“The court ruled that the Monsanto-DuPont license agreements ‘are unambiguous and do not grant Pioneer the right to stack’ the Roundup Ready trait with the Optimum GAT trait,” said Scott Partridge, chief deputy general counsel for Monsanto.

But DuPont counter-sued Monsanto last year, saying the company was acting illegally to control the agricultural seed market by limiting competition.

Among other things, DuPont and others have specifically alleged that Monsanto has been trying to limit availability of its Roundup Ready gene, which comes off patent in 2014, as it pushes it second-generation, patented “Roundup Ready 2 Yield” genetic trait into the marketplace.

Analysts had differing views on the developments.

Sterne Agee analyst Mark Connelly described the court decision as “another in a series of setbacks” for DuPont and its Optimum GAT product line, which has struggled with regulatory approvals and performance.

He said Monsanto “may emerge stronger, rather than weaker” from the antitrust investigation as regulations regarding off-patent GM seed are clarified.

But Buckingham Research analyst John Roberts said it was too soon to tell how the companies would fare in both the fields and the courts in their battle over seed technology and competitive tactics.

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