Termination of Seeds sub-licence Pact Illegal

The Delhi high court on Tuesday ruled that Monsanto Technology LLC’s termination of its sub- licence agreement with Nuziveedu Seeds Ltd was illegal and arbitrary. 

The court reinstated the agreement, but said the royalty or trait fee payable for use of Monsanto’s patented Bt cotton technology would be as per government stipulations. 

“The parties shall remain bound by their respective obligations under the terms and conditions of the 2015 sub-licence Agreements,” the court said, in its 96-page verdict. 

The court directed the sub-licence agreement to be modified according to the format of the GM Technology (GM Trait) Licensing Agreement prescribed under the Licensing and Formats for GM Technology Agreement Guidelines, 2016 issued by the government. 

The government, in 2015, notified a cotton seed price control order by which it reduced price by 74%, from Rs.163 per packet to Rs.43 (excluding taxes). 

Justice R. K. Gauba also clarified that default of the court’s orders would disentitle Nuziveedu Seeds from the “continued use of the suit patent or trademarks (of Monsanto under litigation) of the plaintiffs, consequent whereupon, in such event they would stand injuncted against continued use of suit patent and registered trademarks of the plaintiffs for the pendency of the suit.”

Monsanto Inc, through its Indian arm Mahyco-Monsanto Biotech Ltd, sued Nuziveedu Seeds and its subsidiaries Prabhati Agri Biotech Ltd and Pravardhan Seeds Pvt Ltd for continuing to sell seeds using its patented technology despite termination of its sub-licence agreement in December 2015.

Source: Live Mint