World Grain - November 2011 - 58

FEATURE

Injunction against denied
A
federal court has denied a motion by Syngenta Seeds, Inc. to enjoin Bunge North America Inc. from refusing to accept Syngenta’s Agrisure Viptera corn. The lawsuit, which was ﬁled Aug. 19 in the U.S. District Court, Northern District of Iowa, Western Division, had drawn widespread attention across the grain handling industry. Reacting to the decision by Judge Mark W. Bennett, Bunge said, “This ruling is consistent with and validates Bunge’s decision to reject Agrisure Viptera corn at all of our locations as a legitimate and reasonable business decision. “In rejecting Syngenta’s request, the court said the public interest would best be served ‘…in fostering export markets for United States corn, in allowing business to make legitimate business decisions, and in allocating the risk of commercialization of a new transgenic corn trait upon the party that commercialized the trait…’ “We believe that the court will not vary from the opinion denying the preliminary injunction and will ultimately conﬁrm its ruling that Syngenta’s case is without merit. We believe the court’s ﬁnal ruling will further validate the actions Bunge took to protect the integrity of our export supply chain.” Bunge has posted notiﬁcations at its grain elevators, informing growers Viptera would not be accepted. Bunge said its refusal was because China has not approved Viptera. Syngenta ﬁled the lawsuit in response to Bunge’s decision not to accept Viptera, which has been approved for planting in Canada, Argentina and Brazil, and for import in Australia, Brazil, Mexico, New Zealand, the Philippines, South Korea, and Taiwan. “We are taking this action to remove the illegal impediment Bunge imposed on growers when they announced mid-season that they would not accept grain enhanced by the Agrisure Viptera trait,” David Morgan, president of Syngenta North America, said after the suit was ﬁled. “When a product has been legally approved, growers should be able to use that technology without subsequently being subjected to arbitrary actions. Our ﬁrst priority is growers. Growers inherently face a myriad of risks and Bunge’s decision to change grain speciﬁcations when farmers had already planted
58

by Eric Schroeder

Federal court rejects Syngenta’s motion to enjoin company from refusing to accept Agrisure Viptera corn
their corn is unacceptable. We are working with farmers who are impacted by this decision to help them ﬁnd alternatives for delivering their grain.” In his Sept. 27 decision, Judge Bennett said he refused to issue the temporary injunction because it was unlikely Syngenta would prevail in its claims. “I ﬁnd no likelihood that Syngenta will succeed on the merits of the claims on which it focused, its warehousing, Lanham Act, and third-party beneﬁciary contract claims,” he said. “That being so, the remaining factors do not change the balance against granting preliminary injunctive relief. “While I acknowledge that Syngenta does face a substantial threat of reputational harm in the absence of a preliminary injunction, I am not convinced that the harm is of Bunge’s making. Moreover, I ﬁnd that disproportionate harm would fall upon Bunge, if I were to enjoin its actions in the manner that Syngenta requests. “Bunge’s decision to reject Viptera corn at all of its locations was a legitimate and reasonable business decision; the injunction would impose prodigious costs on Bunge for a situation that Bunge did not create; and Bunge’s purported promise in April 2010 to accept Viptera corn once that corn had received import approval in Korea and Japan simply does not make it inequitable for Bunge to decide for the following crop year not to accept Viptera corn, so that it could service substantial export contracts for corn to China.
Eric Schroeder is managing editor of Milling & Baking News, sister publication of World Grain. He can be reached at eschroeder@sosland.com.
We want to hear from you — Send comments and inquiries to worldgrain@ sosland.com. For reprints of WG articles, e-mail reprints@sosland.com.

November 2011 / World Grain / www.World-Grain.com

http://www.World-Grain.com

World Grain - November 2011

Table of Contents for the Digital Edition of World Grain - November 2011