Monsanto's mermaid problem

When mythical sea creatures and antitrust lawyers gang up, you're in trouble


Andrew Leonard
December 16, 2009 2:20AM (UTC)

Monsanto is not the first company I think of when assigning blame for sabotaging climate talks, but according to 37 percent of the voters in the Friends of the Earth Angry Mermaid contest, the biotech seed company is the most egregious offender on the planet, edging out Shell and the American Petroleum Institute.

The award, says FoE, is meant to "highlight those business groups and companies that have made the greatest effort to sabotage the climate talks, and other climate measures, while promoting, often profitable, false solutions."

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Agriculture giant Monsanto was nominated for promoting its genetically modified (GM) crops as a solution to climate change and pushing for its crops to be used as biofuels. The expansion of GM soy in Latin America is contributing to major deforestation and greenhouse gas emissions.... Monsanto also wants GM soy to be funded under the Clean Development Mechanism.

Seems to me that there is a bit of a contradiction at work here. If Monsanto believes that GM soy should qualify as a carbon offset under the Clean Development Mechanism, wouldn't that mean that the company would support a strong agreement on emissions at Copenhagen? If a world carbon tax regime or cap-and-trade scheme became reality, wouldn't that make Monsanto's products more valuable? (Providing, of course, that anyone could prove that GM soy plantations or GM corn-derived biofuels really did result in a net decline in greenhouse gas emissions, which seems highly dubious.) But I'm betting the voters in FoE's poll did not stop to think this through. Monsanto has become one of those brands that inspires overwhelming kneejerk antipathy -- the American Petroleum Institute never had a chance, even though API has done far more to fight action on climate change than any biotech company.

And of course, good reasons to distrust Monsanto are legion. I wrote earlier this summer about hints that the U.S. Department of Justice was considering antitrust action against Monsanto, based on the company's near complete monopoly power in huge sectors of the U.S. seed market. On Monday, the Associated Press published a blockbuster expose of Monsanto's anti-competitive practices in the seed business, written by Christopher Leonard (no relation), that makes a darn good case for trust-busting.

Among the goodies dug up by Leonard: When Monsanto licenses its gene traits to independent companies, the terms of its contracts include a clause that requires the licensee to destroy its inventory of seeds in the event of a change of ownership. What this means is that Monsanto's competitors have no chance to bid against Monsanto in any potential buyouts.

Monsanto's provision requiring companies to destroy seeds containing Monsanto's traits if a competitor buys them prohibited DuPont or other big firms from bidding against Monsanto when it snapped up two dozen smaller seed companies over the last five years, said David Boies, a lawyer representing DuPont who previously was a prosecutor on the federal antitrust case against Microsoft Corp.

Competitive bids from companies like DuPont could have made it far more expensive for Monsanto to bring the smaller companies into its fold. But that contract provision prevented bidding wars, according to DuPont.

"If the independent seed company is losing their license and has to destroy their seeds, they're not going to have anything, in effect, to sell," Boies said. "It requires them to destroy things -- destroy things they paid for -- if they go competitive. That's exactly the kind of restriction on competitive choice that the antitrust laws outlaw."

Maybe the Angry Mermaid can help?


Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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