9 May 2003

US will go to WTO/Farmer jailed because of dispute with Monsanto/Monsanto's patents to be challenged in supreme court

* US has decided to challenge EU's policy on GM foods in WTO
* Genetic food patent challenge to hit Canada court
* Farmer jailed because of dispute with Monsanto
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US has decided to challenge EU's policy on GM foods in WTO - sources
Source - AFX Asia (Eng)
Friday, May 09, 2003  07:04

WASHINGTON (AFX) - The United States has decided to challenge the European Union's de facto moratorium on genetically modified foods in the World Trade Organization, senior administration sources said.

"We've been pushed against a wall here," a senior administration official told AFX News on condition of anonymity, adding that a case is expected to be filed by "mid-June" at the latest.

And it could come sooner. In fact, "sooner is probably more likely," the official said. Officials are still debating the timing of filing the legal papers. At issue is whether to file the case before or after the upcoming G8 summit in Evian, France.

Bush is set to travel to the southern French coast early next month for the annual gathering of the heads of state of the Canada, France, Germany, Italy, Japan, Russia, the UK and the US.

Richard Mills, spokesman for US Trade Representative Robert Zoellick, whose office would lodge the complaint for the US, declined to comment on the decision to go ahead with the case, saying simply "the EU's moratorium is illegal under WTO rules and needs to be lifted."

A group of EU countries including France has placed a moratorium on approving GMO imports, effectively halting the trade.   

The US contends that the ban, applied since 1999, harms its exports of maize, cotton and soya.    The US has been toying with the idea of filing a case against the EU for several months, but delayed filing the case because of the war with Iraq, officials have said.

In January, Zoellick stunned reporters when he announced that he "personally" held "the view that we now need to bring a case" in the WTO even though there was not an official government consensus on the matter.    Zoellick at that time was careful to note that a cabinet level meeting hosted by the National Security Council still needed to take place before a decision could be made.

A formal meeting including the heads of the Agriculture, Commerce and State Departments is no longer necessary, an official said.    "There's been inter-agency consultation at that level but without a formal meeting," the official said, "the consensus is there."

Senate Finance Committee Chairman Charles Grassley, who has been a vocal proponent for filing a case, separately summoned a group of senior administration officials to his Capitol Hill office this week to press for filing a case. "I called this meeting because I was tired of getting an inadequate response from administration officials," Grassley, an Iowa Republican, said in a written statement after the Tuesday meeting in his office.    "They say they support bringing a case, but their actions don't match their words. I finally decided that the only way to get a clear answer was to bring administration officials to my office, so I did," Grassley added.

EU Trade Commissioner Pascal Lamy has said in recent months that if the US did file a case, the EU would win.    "We would win a case like this," Lamy told reporters in Washington in March after meetings with US lawmakers and administration officials, including Zoellick.

And EU officials have suggested that there would be a consumer backlash against American goods resulting in boycotts of American food products if the US filed a case at the WTO.

The spat comes on the heels of strained US-EU relations over the war in Iraq and a separate trade dispute over tax breaks that benefit US exporters such as Boeing Co and Microsoft Corp.

Earlier this week, the EU was authorized by the WTO to levy up to 4 bln usd in sanctions against the US for tax breaks given to US exporters that have been found to be illegal under the rules of the Geneva-based trade body.

The EU has given the US until autumn to change its tax laws or face the sanctions that would be imposed beginning January 1, 2004.

Asked if the US-EU relationship would be harmed if the fines were levied, White House spokesman Ari Fleischer said trade disputes are a natural part of the relationship.

"Clearly, trade is always one of those many issues that allies are going to differ about and remain the best of allies. That's the nature of trade," Fleischer said Wednesday.    "So it's part and parcel of a relationship that is as robust as it is that we're going to have inevitable trade disputes. And that's why the WTO has set up the mechanisms it has," Fleischer added.
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Genetic food patent challenge to hit Canada court
Source - Reuters Securities News (Eng)
Friday, May 09, 2003  00:22
By Randall Palmer

OTTAWA, May 8 (Reuters) - A farmer crusading against genetically modified grain won the right on Thursday to take the case to the Canadian Supreme Court to challenge the patent rights of biotech giant Monsanto Co.

In what began as a question of whether Percy Schmeiser had grown Monsanto grain without a license on his Saskatchewan farm, the case has broadened to what Schmeiser sees as a David-and-Goliath battle over genetically altered food.

The Supreme Court agreed on Thursday to hear an appeal of lower-court decisions that Schmeiser had violated the Monsanto patent for canola modified to tolerate the herbicide Roundup.

It is a powerful invention -- all the weeds disappear but the canola is left standing -- and 80 percent of the country's farmers now grow transgenic canola. Canola is the Canadian variant of rapeseed, used especially for cooking oil.

Monsanto is also hoping to introduce Roundup Ready wheat, for a much larger market, but many farm groups are wary because most international buyers say they do not want genetically modified wheat.

The company took Schmeiser to court after it discovered its patented transgenic canola growing on his farm. Schmeiser had not signed a C$15 ($10.80) per acre agreement with the company to grow it.

Schmeiser says he spent 40 years cultivating his own, conventional canola varieties, saving seed from one crop to plant the next and that he did not know how the genetically modified plants ended up on his farm.

He suggested that seeds blew off passing trucks, or pollen from nearby farms was carried in by wind, insects or birds, and he contended that Monsanto had unleashed an "invention" they could not control into the environment.

Monsanto said independent tests of Schmeiser's farm had found that 1,030 acres were 95 percent to 98 percent tolerant to Roundup -- though this was contested by the farmer.

Referring to the trial judge's decision in 2001, Monsanto said in a statement: "At such a high level of tolerance, Justice MacKay ruled the seed could only be of commercial quality and could not have arrived in Mr. Schmeiser's field by accident."

Monsanto spokeswoman Trish Jordan said: "We were hopeful the unanimous decision of the Federal Court of Appeal would have put an end to unnecessary and costly legal action in this case."

The Supreme Court is not likely to be hear the case before the autumn at the earliest.

($1=$1.39 Canadian)
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Farmer who lied in dispute with Monsanto will go to prison
May 7, 2003
St. Louis Post-Dispatch
Peter Shinkle
http://www.stltoday.com/stltoday/news/stories.nsf/News/10B20CFF4D9FA42386256

Farmer Kem Ralph, 47, of Covington, Tenn, who was opposed to Monsanto Co.'s genetic seed licensing practices, was sentenced Wednesday in federal court at St. Louis to eight months in prison for lying about a truckload of cotton seed he hid for a friend.

Ralph also admitted burning a truckload of seed, in defiance of a court order, to keep Monsanto from using it as evidence in a lawsuit against him. The story says that the prison term for conspiracy to commit fraud is believed to be the first criminal prosecution linked to Monsanto's crackdown on farmers it claims are violating agreements on use of the genetically modified seeds.

Ralph pleaded guilty in U.S. District Court on Feb. 21 of lying in a sworn statement in the civil case.  Officials of the company, based in Creve Coeur, hoped that Ralph's case would send a stern message. Monsanto has distributed information about it and about the civil litigation as a warning.

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