FARMER TO FARMER CAMPAIGN ON GENETIC ENGINEERING
P.O. Box 272 – Stoughton, WI 53589
T: 877-968-3276 F: 608-873-1190
Email:bwenzel2@aol.com
Statement in Support of Montana Senate Bill 218
Thank you Mr. Chairman and Members of the Committee for the opportunity to provide testimony in support of Senate Bill 218. My name is Bill Wenzel. I was born and raised on a small livestock operation in central Wisconsin. Livestock raised on the farm were slaughtered and processed by our family owned sausage making plant – Wenzel Farm Sausage – which is still in business today.
I have more than 20 years of experience in farm advocacy work and have served as Chief of Staff and Legislative Aide for two former Wisconsin State Senators who chaired Senate Committees on Agriculture and Natural Resources. I am currently the National Director of the Farmer to Farmer Campaign on Genetic Engineering, a network of 34 farm groups from across the country, organized in 1999 to provide a national voice for farmers on agricultural biotechnology issues. Northern Plains is affiliate organization and I am here today at their request.
Genetically engineered crops have had significant economic impacts on farmers and have exposed them to new risks and legal liabilities. We are not here today to discuss the economics of growing genetically engineered versus conventional seed varieties. However, I will tell you that it has been the experience of our farmers and that of independent researchers that genetically engineered varieties have not performed as advertised. Herbicide tolerant varieties are more costly to produce and result in lower yields. Genetically engineered crops and foods have been rejected in the global marketplace costing U.S. commodity producers significant foreign markets. In short, genetically engineered crops have done nothing to enhance the financial well-being of the family farmer.
We support Senate Bill 218 because it places the risks and liabilities for contaminating the countryside with genetically engineered wheat squarely where it belongs – on the industry that manufacturers it.
You are to be applauded for your foresight in considering legislation to indemnify the producer and to make the industry liable for the economic loss that is most certain to occur through the contamination of your valuable wheat industry if genetically engineered varieties are approved for commercial production. Having a clear statutory framework for determining liability in the event that genetically engineered wheat is approved for commercial use will reduce the need for costly litigation.
Genetic engineering has dramatically changed the legal landscape for farmers. Farmers don’t purchase genetically engineered seeds. Through Technical Use Agreements (TUAs) farmers license the use of the seed for one growing season. In entering into a TUA, the farmer gives up the ability to make basic farm management decisions and provides the seed manufacturer with unfettered rights to obtain financial information, crop data, and government farm program information and to inspect the property at any time there is reasonable belief that the farmer is engaged in the unauthorized use of patented technology.
Monsanto has consistently abused these contract rights forcing farmers to defend costly lawsuits based on nothing more than rumor and innuendo. I will describe a couple of these lawsuits later in my testimony
Even more egregious are the provisions in TUAs that transfer all liability for damages associated with contamination and commingling from the manufacturer to the farmer. Farmers only license genetically engineered seeds for one year yet the TUAs make them liable for all economic harm caused by contamination and commingling, which will almost certainly occur if GE wheat is introduced for commercial production.
To pit farmer against farmer in lawsuits to resolve these contamination issues is unconscionable. Senate Bill 218 will all but eliminate the potential that rural communities will be torn apart as a result of farmer suing farmer neighbors over contamination caused by genetically engineered wheat.
Genetic engineering has also placed the world of well-settled law regarding agricultural contamination on its head. For centuries, farmers have been held liable for damages caused if an activity that they were engaged in on their farm contaminated a neighbor. Patented seeds change those liabilities dramatically. Farmers using conventional seed varieties are continually exposed to contamination and commingling with genetically engineered seed varieties and can be held liable for unauthorized use of patented technologies even in instances where they did not intent to use genetically engineered, did not want them nor received any economic benefit from them.
To hold them liable for patent infringement in these situations is totally ludicrous. Senate Bill 218 relieves the farmer of paying damages in patent infringement actions where there is no breach of contract involved and the farmer unknowingly possessed patented seeds.
We are not talking about abstract legal principles here. Farmers face these problems everyday in areas where genetically engineered corn, soybeans, canola and cotton are grown. According to a 2005 report entitled Monsanto vs. U.S. Farmers recently published by the Center for Food Safety, Monsanto dedicates $10 million annually and devotes 75 staff solely to investigating and prosecuting farmers for violating TUAs and infringing on their patents. To date, 90 lawsuits have been filed involving 147 farmers and 39 farm-related businesses. Judgments in these cases average more than $400,000 with the largest settlement against a farmer coming in at a little over $3 million. All tolled more than $15 million in judgements have been entered in favor of Monsanto on genetic engineering lawsuits.
I am not here today to tell you that all of these farmer-defendants were white knights in shining armor – above reproach. I am here to tell you that in all instances, farmers are placed at considerable disadvantage in defending themselves against lawsuits brought by the industry and that Senate Bill 218 goes a long way in leveling the playing field.
I would like to cite a couple of specific examples to assist you in better understanding what this discussion is really all about.
Rodney Nelson together with his father and brother farm about 10,000 acres in northeastern North Dakota. They produce soybeans, corn and sugar beets. They are well-respected members of their community.
In 1998 the Nelsons decided to experiment with genetically engineered varieties, planting 62 acres of newly converted pasture in Roundup Ready soybeans. In 1999 they planted 1500 acres in Roundup Ready and 2300 acres in conventional varieties.
In July of 1999, a person identifying himself as a former FBI agent came to the farm unannounced. He informed Rodney that he was working for Monsanto and had reason to believe that the Nelsons had illegally used the company’s patented seeds. He demanded all of Rodney’s financial records as well as his invoices for seed and herbicide purchases for the preceding two years. Rodney obliged being confident that a review of the records would establish that he had not engaged in conduct violative of his contract with Monsanto or their patent rights.
In November of 1999 two inspectors identifying themselves as Agents for Monsanto came to his farm – again unannounced. They stated that they were authorized to test his fields for the presence of Roundup Ready soybeans and demanded that Rodney provide them with directions to his fields. Again, Rodney cooperated fully with the demands believing that the testing would show that he had not been engaged in any unlawful use of Monsanto’s patented seeds.
The Nelsons would hear nothing from Monsanto until July 2000 when they received what is
commonly referred to as an “extortion letter” from Monsanto. A meeting was arranged with Monsanto’s attorneys for September 2000. At the meeting the attorneys attempted to intimidate Rodney into settling the case but refused to disclose the results of their investigation or the tests that had been conducted on Rodney’s crops.
The next two years were a living hell for the Nelsons. Endless meetings with attorneys. Countless hours consumed in compiling documents and financial records to meet the demands of Monsanto’s legal staff. Fortunately, the Nelsons keep meticulous records and they became increasingly confident that they had a solid defense to the company’s claims.
Through discovery they had gained access to the investigative reports and the testing done on the crops. Among the fields allegedly testing positive was a field owned by a neighbor who had grown non-genetically engineered soybeans and who had tested and certified those crops for sale to a specialty market. Another field allegedly testing positive for Roundup Ready soybeans had been planted in sugar beets.
Armed with this evidence, the Nelsons demanded a hearing before the North Dakota Seed Arbitration Board. The Board hears all disputes involving seed issues and makes non-binding recommendations to the Court. The hearing was set for April 2002. Monsanto refused to attend on the grounds that only a Missouri court could adjudicate the dispute. Monsanto did not notify the parties of this decision until the night before the hearing was to take place. Despite their failure to attend, the hearing was held in Monsanto’s absence. After considering all the evidence the Board recommended that Monsanto dismiss its case against finding no evidence to support their allegations of unauthorized use of Roundup Ready technologies.
Ultimately, Monsanto agreed to dismiss its lawsuit against the Nelsons in September of 2002. However, the victory was a shallow one for the family who had to pay almost $100,000 in attorney’s fees to defend against Monsanto’s unfounded allegations. During the two years that they were involved in the litigation they were forced to rent out their sugar beet fields due to lack of time to dedicate to this labor intensive crop. An estimated $400,000 in revenue was lost as a result. More tragic was the fact that Rodney’s father developed a heart condition as a result of stress involved in the litigation.
The story of Troy Roush and his family is strikingly similar. Troy farms with his father and two brothers in northcentral Indiana. They raise soybeans, corn, popcorn and wheat on approximately 5500 acres. In 1999 the Roushes planted 492 acres of Roundup Ready soybeans and 1100 acres of conventional varieties. Sometime during the course of that growing season, Monsanto entered their farm without their permission or knowledge to test for the presence of Roundup Ready traits. Initially, the Roushes were told that of the 12 fields tested all but two tested positive for Roundup Ready.
Like the Nelsons, Troy and his family spend the next two years in litigation. Ultimately, the claims against the Roushes were dismissed but not before they had amassed $392,000 in attorney fees.
Montana has the opportunity today to ensure that its wheat growers never have to confront litigation nightmares similar to what the Nelsons and the Roushes experienced. Make the industry liable for the contamination they cause. Pass Senate Bill 218. It is the right thing to do.
The Roushes and the Nelsons have authorized me to provide their names and their telephone numbers in the event that Members of the Committee have further questions. Their contact information is provided at the bottom of this testimony.
Thank you for the opportunity to testify in this matter. I will be available if the Committee should have any questions.
Rodney Nelson: (701) 347-5456
Troy Roush: (260) 375-3238