Monsanto Hit by Lawsuit

by Danielle Knight

The suit alleged that Monsanto rushed genetically modified seeds into the market without adequate testing, and formed an international cartel to control the world's corn and soybean market.

The suit, filed Dec. 14 in a Federal District Court in Washington on behalf of six farmers from Iowa, Indiana and France, targeted the St. Louis-based Monsanto but also named nine other companies, including DuPont, Novartis and Pioneer Hi-Bred, as "co-conspirators."

"This is the beginning of a new chapter in the debate over genetically modified foods," said Jeremy Rifkin, a long-time critic of biotechnology, who initiated the lawsuit.

The legal action will put the spotlight directly on the life science companies and the future of agriculture, said Rifkin, who heads the Washington-based Foundation on Economic Trends.

"The lawsuit will refocus the global debate," he said. "It's no longer just a trade issue between the United States and the European Union."

The suit is being led by the leading U.S. class action firm Cohen, Milstein, Hausfeld & Toll on behalf of a consortium of other companies who have taken the case on a no-win, no-fee basis.

Team leader is Michael D. Hausfeld, a Washington-based lawyer known for his work against the Exxon oil company when its Valdez oil tanker spilled crude oil into Alaskan waters.

Hausfeld said that since 1996, Monsanto had used rural markets to control global corn and soybean markets. The lawsuit contends that Monsanto initiated a conspiracy to eliminate competitors in the market through licensing agreements and the misuse of patenting rights.

According to Hausfeld, the company bought up large seed companies and plotted with other corporations to inflate prices and force small farmers to agree to package deals of Monsanto products.

The lawsuit claimed that there was still uncertainty over the safety of biologically engineered seeds. Monsanto, for example, should have done additional testing for its Bt corn product in other countries to determine if the crop posed any risks in other climates and soil types, said Rifkin.

He pointed to a recent study by Cornell University which concluded that the larvae of the monarch butterfly had been harmed by Bt corn pollen.

"What are the repercussions for foraging birds, insects and other animals when they digest plants that are acting as pharmaceutical factories?" he asked. "We just don't know."

The lawsuit also seeks millions of dollars in damages on behalf of farmers in the United States and abroad who, according to Hausfeld, are unable to market their genetically modified crops.

In 1999, about half of the soybeans and one-third of corn grown by U.S. farmers were genetically modified varieties.

Monsanto has denounced the suit, dismissing the accusations as "groundless."

David Snively, assistant general counsel for Monsanto, insisted the company's biotechnology products were safe and had been approved by U.S. regulators. He denied that Monsanto was engaged in a conspiracy to control the world's seed market.

"This action is another in a series of unsuccessful attempts by veteran antagonists to stop a technology with the potential to improve our environment, increase food production, and improve health," Snively said. Prior to entering the market, each of Monsanto's seeds underwent years of "rigorous testing."

Biotechnology was adding critical tools in the fight against nutrient deficiencies and disease, Snively said.

"Monsanto is committed to the farmer's right to have access to high quality seed choices," he added.

The lawsuit reflects growing concern in the United States over the potential impact biotechnology will have on public health and the environment.

At recent public hearings held by the Food and Drug Administration (FDA), which approves genetically modified foods, scores of environmental and consumer groups challenged the standards of the regulatory system.

In November, U.S. lawmakers introduced a bill that would require labeling of all biologically engineered food. And on Dec. 13 in Oakland, California, hundreds of protestors marched in a rally against biologically engineered foods.

Financially, Monsanto, which has invested billions of dollars into the technology, is beginning to feel the pressure from the campaign against its products.

Monsanto has about 20 days to file a formal response to the lawsuit. The case is now technically in the legal process known as "discovery" where witnesses are questioned and information is gathered.

Hausfeld said parallel lawsuits would be launched against Monsanto outside the United States. Attorneys in Australia, Europe, Central and South America, India, and parts of Southeast Asia were investigating the possibility of legal action against the company, he said.

Environmental groups, critical of the technology, said that the suit will force seed companies to seriously rethink how much they will invest in biotechnology.

"I can't imagine it won't have an effect on research and development on genetically modified foods," said Peter Roderick, legal adviser to Friends of the Earth.