Lamson, Dugan and Murray, LLP, Attorneys at Law

Syngenta Under Pile of Lawsuits for Alleged Losses Caused by China’s Ban of Viptera Corn

Posted in Biotechnology

tall corn

The lawsuits against Syngenta for alleged losses due to China’s ban of Viptera corn are starting to pile up.  Nine such lawsuits were filed in the United States District Court for the Southern District of Iowa in October with more expected as producers jump on the pile started by Cargill in September.

In 2011 Syngenta launched the Agrisure Viptera trait to producers after being deregulated by the United States Department of Agriculture (USDA).  The Viptera trait acts as a biological insecticide targeting certain pests without harming non-target organisms. ISU Integrated Crop Management News    While approved in the U.S., Canada, Mexico and several other export nations, the trait was not and has not been approved in China; the number 3 export market for U.S. corn.

Some believe China is using the GMO angle to get out of U.S. corn contracts in light of China’s recent record crops.

Whatever China’s motives, Cargill filed suit claiming Syngenta should have never marketed or released the Viptera trait without China’s approval.  The claimants allege the rejection of corn with even trace amount of Viptera added supply to the domestic market, thereby driving down the price of corn by approximately 11 cents per bushel. via Wall Street Journal Cargill claims the U.S. grain industry lost approximately $2.9 billion due to the loss of the Chinese market. &Newsobserver.com

The claimants face some legal hurdles including proving China’s rejection of Viptera corn was a proximate cause in the drop in corn value. Furthermore, the claimants will have to prove that Syngenta has a duty to ensure the availability of foreign markets before releasing a given trait.  Finally, the claimants will have to get over the issue that the producers voluntarily planted the crop with the restrictions in place.

China may eventually approve Viptera, thereby saving Syngenta’s investment in the technology.  In the meantime, Syngenta will have to try to dig out of the current pile of lawsuits which is expected to turn into a class action. Whether or not Cargill and the producers are successful, the litigation may have an impact on how and when genetically modified seed is released in the future.