Carla Yu
Alberta Report

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Sitting across his kitchen table from the private investigator last September, “Robert” (not his real name) felt trapped. “What about all this other canola?” demanded the investigator, a former RCMP officer. The intimidation worked. “Well, you got me,” confessed Robert. Over half of the Roundup Ready Canola (RRC) crop he had sitting in his farm bins, just harvested, was legally grown under a Technology Use Agreement (TUA) with biochemical giant Monsanto. But the rest-235 acres worth—was from unauthorized seed he had saved from a previous year. “When he came, he said it was an audit,” says the Saskatchewan fanner. “Halfway through, he said, “There’s a report you’re growing illegal Roundup Ready Canola. Where is it?'”

Like over 20,000 other Canadian prairie farmers who have signed on to Monsanto’s herbicide-resistant canola program since the genetically engineered seed was introduced in 1996, Robert was captivated with the idea of easier, cheaper weed control. The specialized “transgenic” seed, which incorporates a gene from bacteria, can survive multiple applications of Monsanto’s Roundup herbicide, which kills most other plants. Farmers need to spray fewer times, the chemical is less dangerous or expensive than many other herbicides, and weed control is highly effective. All this adds up to savings—and temptation. Monsanto charges a fee of $15 per acre for the one-time use of its seed, and the TUA prohibits farmers from saving and re-planting the seed or selling it to others. But some do anyway, and that has led to a growing black market in pirated seed, an aggressive campaign against the pirates by Monsanto and its field agents, and a good deal of uncertainty over the legal enforceability of genetic patents.

“He came down hard on me,” says Robert of his first confrontation with the Monsanto agent. “Scared the bejeezus out of me.” The investigator accused him of supplying others with illegal seed and tried to get him to turn them in. At a subsequent meeting with Monsanto enforcers—sans lawyers at their insistence—Robert was told he would have to pay a “non-negotiable” fine of $115 per acre. “The profit from the crop was at most $14 per acre,” says the farmer. At that point, he walked out and got a lawyer. He also made a hasty sale of all his canola to the crushing plant. “They implied they were going to go after the crop in the bins,” he says. “We worked at night like rats, hauling it out in semis loaded as full as we could.”

So far, Monsanto has not acted on its threats. Robert faces no lawsuit and has made no settlement with the company. “I’ve heard the big dog bark, but I haven’t felt the bite,” he boasts, but to avoid provoking it too much wants his name withheld.

Robert is certainly not the only prairie farmer using unlicensed seed. “Last spring, I could have bought a semi-trailer load of brown bag seed [illegal RRC] at a seed-cleaning plant,” he says. His wife’s father and uncle, who never signed TUAs, have obtained RRC through a source at the seed-cleaner. They ran the “crop cops” off their property, and spent days ensuring no RRC was in road allowances around their fields, where samples could legally be taken. They have not yet been prosecuted for anything. Robert has noticed the odd neighbour who, on hearing about his experience, plowed under rapeseed crops. And he meets regularly to discuss strategy with a couple of other RRC pirates who have also been caught.

Monsanto insists the black market is small. “We’ve only found 16 violations,” says Craig Evans, general manager of biotechnology for Monsanto Canada. “Eight of those settled out of court. The others are still pending. We’ve only launched one lawsuit.” The company has the legal right to enforce its patent on the seed, asserts Mr. Evans, to ensure that it earns a return on its multimillion-dollar investment in the technology, and to protect its customers who pay the fees from unfair competition from those who do not.

Hitherto, ownership of new crop strains (developed mostly by government and university researchers) has been governed by the Plant Breeder’s Rights Act, which gives breeders exclusive control for 18 years over the production and sale of the plant varieties they develop. Monsanto is relying on patent legislation instead, which protects ownership for only 17 years, but gives the company exclusive control over the application of the technology to any plant variety. In other words, patenting the technology, rather than just the seed, ensures that Monsanto’s interest is protected no matter how the technology is applied. At the moment, the Roundup Ready gene has been applied to only 10 of the 200-odd varieties of canola. It also has been applied to other crops, such as soybeans, and research continues into other applications, including wheat. “We are not plant breeders,” explains Mr. Evans. “Rather, we are a technology company. We provide technology to breeders.”

The TUA is a new idea in the farming community. Seed contracts, in which a company sells a farmer seed in return for a guarantee it can buy the harvest if it wishes, are common. But farmers do not buy the seed from Monsanto, only the technology license. Then they go to a seed supplier to purchase the RRC itself, and they can sell the harvest to whichever processor they choose.

Typically, seed developers incorporate research costs and royalties into the price of the seed when they sell it to the supplier. Agrevo, Monsanto’s rival in transgenic herbicide resistant seed, sells its “Liberty Link” canola at about the same price as regular seed, but charges more for the key herbicide. This was not a practical or profitable strategy for Monsanto because its patent on the herbicide Roundup expires in the near future.
But TUAs are hard to enforce. Monsanto contracted private investigation firms, such as Robinson Investigations in Saskatoon, to conduct audits and enquire into complaints. Mr. Evans is not sure how many people are actually involved, but he reports that 225 audits were conducted last year. It is rumored that the number of people involved in Monsanto’s enforcement campaign quadrupled this year. The company used to have a toll-free tips line, but it was discontinued because, according to Mr. Evans, it was not very effective and the Stalinist overtones reflected poorly on the company.

By all appearances, Monsanto would prefer to resolve its alleged patent infringements quietly, inexpensively and out-of-court, rather than engage in public David-versus-Goliath battles with farmers. But inevitably the company ran into one producer who would not co-operate, and it was forced to take legal action. Percy Schmeiser farms near Bruno, Sask., about 75 miles east of Saskatoon. In a lawsuit filed a year ago, Monsanto alleges that in 1997 or earlier Mr. Schmeiser obtained RRC seed from an unnamed licensed grower, made money off the resulting crop and saved the seed for planting in future years without Monsanto’s permission.

“I never bought it, I never had anything to do with it,” declares Mr. Schmeiser. He maintains that, far from being a criminal who wanted to profit off stolen technology, he is a victim of that technology invading his property. If Monsanto pursues their suit, Mr. Schmeiser plans to countersue for $10 million for crop contamination, defamation and trespass.

In Mr. Schmeiser’s version of events, he sprayed for weeds in ditches and around telephone poles adjacent to his canola field in 1997 and subsequently noticed that while all the other vegetation died, the Roundup he was using did not kill six out of 10 canola plants. The same thing happened when he sprayed a trial strip about 100 feet wide in the middle of the field. “I had been doing my own thing, re-using seed. I hadn’t paid attention,” says Mr. Schmeiser, adding it never occurred to him that his Roundup-proof plants might be a genetically altered variety. He used the seed from that field to plant hundreds of acres the following year, and that is when Monsanto paid him a visit. “When I was told what I was growing, I said, I don’t even know what that is,’ ” he says.

Mr. Schmeiser speculates seed must have blown off passing trucks and machinery to get into his field, and from there cross-pollinated with his own canola to produce a high percentage of Roundup resistance throughout the field the following year. “I’m not using the technology,” he says. “I would rather have it Roundup susceptible.” The producer and the company had a court-initiated mediation session on August 10, but it produced no settlement.
Lending credibility to Mr. Schmeiser’s germinatio ex nihilo theory are reports from others who claim that the transgenic yellow flowers simply showed up on their land. Louie Gerwing, who farms near Lake Lenore, about 30 miles north of Mr. Schmeiser’s operation, noticed this summer that some canola plants were thriving in a quarter section he had summer fallowed with chemicals. He says he told a Monsanto agent who took a sample and found it was RRC.

Western Canada’s Resistant Canola
Estimated area sown with herbicide tolerant canola (B. napus) (thousands of hectares)

Year    Roundup   Liberty     Pursuit       Total canola   % herbicide
& Odyssey     area sown       tolerance
1995        0              14               10              5,273               <1%
1996       18             103             227            3,451                10%
1997       182           404             688            4,869                26%
1998    1,214           610            850             5,260                51%
1999¹   2,000          1,226        1,226            6,070                73%
¹Projected production and usage

Since Mr. Gerwing had planted barley, wheat and peas in previous years on the quarter, he believes RRC blew off passing trucks in the winter and was distributed around the field by drifting snow. Monsanto has never contacted me other than to say that it is Roundup Ready,” says Mr. Gerwing. “What I want to know is, can I keep the seed? I could get quite a few pounds.”

But Mr. Evans is very firm about Monsanto’s ownership of the seed, no matter how it falls into a farmer’s possession. “No, you can’t harvest it,” he says. “The gene still belongs to Monsanto, and you need the technology agreement to use the gene.”

“In general, the Intellectual Property Act gives the holders exclusive rights,” agrees David Welsh, an Edmonton lawyer. “You can’t use the property, even accidentally. Say a truckload of seed dumped and blew off. It might be great seed, but it’s governed by rights. It doesn’t matter if it was incidental, the owner of the patent has the right to all money from it.” But by the same token, Mr. Welsh says, Monsanto has a legal responsibility for its technology when it accidentally invades a farmer’s property. “A court would have discretion to say, “Yes, there was an infringement, but you have to pay the costs for cleanup.'”

Common-law principles governing private property rights may be another factor in dealing with the “accidental” spread of RRC, which some farmers and environmental groups consider a pollutant. “I haven’t come across a case where a seed has been a trespass,” says Toronto environmentalist Elizabeth Brubaker, author of Property Rights in the Defence of Nature. Her book looks at cases where everything from dust to sprays and pesticides have been grounds for trespass charges. “But if [Monsanto] claims [the plants] as their property, it gives farmers a stronger case. It’s a fascinating question.”

Environmentalists are attracted to the story because they fear that genetically-altered plants could combine with existing varieties and create hybrids whose characterstics are unpredictable. In theory, such interbreeding might produce an aggressive, herbicide-resistant plant that might be a threat to other crops and very difficult to control. “There is the potential for ecological disaster,” says Charles Margulis, genetic engineering issues specialist for Greenpeace. “The real problem is, what can the industry tell us now that millions of acres are planted?”

Monsanto is hesitant to accept responsibility for cleaning up RRC that wanders into innocent farmers’ fields. “We have 55 representatives out there to help all growers with all weed control problems,” says Mr. Evans. “Covering costs depends on the situation. At the end of the day, I don’t want to say if we do or we don’t.”

In fact, Monsanto has taken action for at least one farmer. Between 300 to 500 RRC plants cropped up in this summer in Charlie Boser’s chemical summerfallow field, about 60 miles east of Provost, Alta. “Monsanto has not gotten back to me,” says Mr. Boser. “But they phoned the person who did the chem fallow for me, and told him to get some kids to come pick it out.” The plants were pulled out of the ground last week.

In the Schmeiser case, and in all future litigation between farmers and seed patent holders, liability will be largely determined through scientific evidence. Mr. Schmeiser says he suspects Monsanto’s genetic testing of the plants found in his field is “way out,” so he is having his plants tested at a different lab.

But Keith Downey, a senior research scientist emeritus at the Agriculture and Agri-Food Canada Saskatoon Research Centre who reviewed the Schmeiser data for Monsanto, believes the company has a solid case. “The results from the grow-out of the seeds harvested from his fields varied between 93% and 99% of plants resistant to Roundup,” he claims. “Only 1% to 7% were susceptible—about what you’d expect from Roundup Ready. The level of susceptibility you’d expect from cross-pollination is at least 25%. It’s highly unlikely it came off a truck in that quantity.”

Mr. Downey’s involvement in canola development stretches back to the 1940s, when its only use was for lubricating steam engines. “In the early years, research was funded almost 100%o by the public purse,” he says. “In the last five to eight years, the private industry has recognized the opportunities for developing and marketing canola varieties in western Canada.”

Canola lends itself to biotechnological modification more readily than cereal crops, but successes with the oilseed have enticed Monsanto and other companies to start experimenting with wheat and barley. The increased involvement in seed production and ownership by a few large corporations has some observers worried that farmers will ultimately become de facto employees of such companies, especially when so-called “terminator gene” technology limits seed fertility to one crop. “Of a number of possible outcomes, serfdom to companies is one,” says Jim Unterschultz, assistant professor of agriculture business and marketing at the University of Alberta. “It would mean getting a lot of other genetically modified crops.”

More likely, Mr. Unterschultz envisions increased “supply chain management” and “vertical coordination” in the agriculture industry. “We may see more coordination and closer relationships between parts of the industry.” He points to developments in the beef industry, where feedlots sell to one processing plant (which has a few select suppliers) and a few trusted ranchers supply the feedlot with animals, as an example of possible directions. “The potential outcome depends on who has the most market power,” says Mr. Unterschultz. “But everyone has to make a bit of money to keep happy.”