New Delhi: The possibility of an out-of-court settlement between PepsiCo India Holdings Private Limited and the potato farmers it sued over patent infringement emerged Friday With legal counsel for the multinational suggesting the possibility at a commercial court in Ahmedabad. ‘Business Standard’ has published the follow up of the incident wherein PepsiCo Inc has sued four Indian farmers for cultivating a potato variety that the company claimed infringed on its patent.
PepsiCo alleged infringement of Intellectual Property Rights (IPR) and sued the farmers from Sabarkantha district for buying seeds and selling potato of the FL 2027 variety, also known as FC-5, which the former had registered under the Protection of Plant Varieties and Farmers’ Rights (PPV&FR) Act, 2001. PepsiCo uses the potato variety to produce chips it sells under the brand Lay’s. The FC5 variety has a lower moisture content required to make snacks such as potato chips. PepsiCo was seeking over Rs 10 million each for the alleged patent infringement. PepsiCo is the second major US company in India to face issues over patent infringement.
A PepsiCo spokesperson said that the company had to take judicial recourse as the farmers were “illegally dealing” in their “registered variety”. “This was done to protect our rights and safeguard the larger interest of farmers that are engaged with us and who are using and benefitting from seeds of our registered variety. We remain committed to resolving the matter and ensuring adoption of best farming practices resulting in higher yield and quality,” the spokesperson has been reported to have said.
Bipin Patel, one of the four farmers Pepsi has sued said: “We have been growing potatoes for a long time and we didn’t face this problem ever, as we have mostly been using the seeds saved from one harvest to plant the next year’s crop.” He, however, declined to reveal where he had gotten the seeds in question.
At the hearing of the case Friday, the counsel for PepsiCo told judge M C Tyagi that PepsiCo could withdraw the case if “the farmers were willing to sign an agreement for buying the registered variety of FC-5 potato seeds and selling the produce to the company only”. PepsiCo is learnt to have engaged 1,200 farmers in Gujarat for sowing and producing the FC-5 variety of potato for its snacks division.
The company, BS reports, suggested that the farmers will have to give an undertaking that they would never buy and sow FC-5 seeds in future. The farmers are yet to respond to the proposal. The legal counsel representing the farmers sought time till June 12 to filing written submissions from the farmers based on the allegations PepsiCo has made. The legal counsel of PepsiCo, too, sought time till June 12 for filing rejoinders to the farmers’ submissions.
The interim stay that the court had previously ordered barring the farmers from growing and selling the potato variety is to remain in effect till the next hearing June 12.
The case caught public attention after about 200 farmers leaders, activists and civil society representatives wrote to the central and state government seeking their intervention in support of the farmers and to protect their rights.
The group maintained that the farmers had not infringed any IPR of PepsiCo as the Section 39(1) of PPV&FR Act, 2001 entitled farmers in India to buy and sow seeds of any variety registered under the Act.
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