Posted: Thursday, March 18, 2010 10:00 AM
Dan Gill/Associated Press
A farmer holds Monsanto's Roundup Ready soybean seeds. Confidential contracts detailing Monsanto Co.'s business practices reveal how the world's biggest seed developer protects its dominance over the multibillion-dollar market for genetically altered crops, an Associated Press investigation has found.
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Monsanto defends licensing practices
Critics say trait agreements stacked against competition
Capital Press
Innovations in seed technology -- and the patents used to protect them -- have raised new questions about competition in agriculture.
The Monsanto Co. has attracted particular attention from critics who claim the seed genetics developer has violated antitrust laws in its quest for market share.
The firm is currently being investigated by the U.S. Department of Justice, according to a 2009 report from The Associated Press.
Seed companies license patented traits from Monsanto, allowing them to insert traits like "Roundup Ready" genes for herbicide resistance into their seed products.
Critics say Monsanto uses these licensing agreements to coerce seed companies and effectively block competitors' traits from the market.
Monsanto counters that seed companies voluntarily choose to license traits due to widespread demand from growers.
"It's the farmer who makes the choice every year," said Kelli Powers, spokesperson for Monsanto. "Everything is driven by the farmers."
As for locking competitors out of the market, Monsanto points out that other developers can enter into agreements that allow different traits to be "stacked" within a seed product.
"No company has done more to enable stacked trait product offerings than Monsanto," the company said in a statement.
The alleged anti-competitive effect of Monsanto's license agreements is currently being debated as part of a federal lawsuit. In a 2009 legal complaint, Monsanto accused the DuPont company, which owns seed developer Pioneer Hi-Breed International, of stacking traits in corn and soybeans in violation of a license agreement.
DuPont said the agreement allowed traits to be stacked and argued that Monsanto's claims were barred by antitrust law.
In January, a federal judge ruled that the license agreement between the two companies did not allow stacking.
However, the judge allowed DuPont to pursue its other legal defenses, including the allegation that Monsanto violated antitrust law.