A ruling by the Brazilian Court of Justice may mark a key moment in the ongoing legal battle between agchem giant Monsanto and the nation’s farmers, who are attempting to recover royalties payments which they believe were taken illegally.

This week the senior Brazilian court upheld the findings of a regional court in the South of the country two months ago and found the ruling applies throughout Brazil. Monsanto had appealed to the court after losing a case in Rio Grande do Sul, where the judge found its business practices violated the Brazilian Cultivars Act. The company had hoped that, at worst the ruling would be localised to the region.

Approximately five million Brazilian farmers are attempting to recoup royalties payments made to the company since 2003 for use of Monsanto’s genetically modified crops, the novel traits of which the company claims are its intellectual property. Worldwide, Brazil is the second largest grower of soy and second largest producer of GM crops; Monsanto’s glyphosate resistant soybeans make up 85 per cent of the Brazilian crop.

Since the crops were legalised, farmers have been charged a 2 per cent royalty fee by the company, on top of the price they pay for their seeds. Farming unions in the country have said that this practice is unfair and amounts to forcing farmers cultivating the seeds to pay twice. They also claim the process is potentially implicating innocent farmers; the unions have said contamination of conventional soybeans with GM traits is common place and difficult to avoid.

Monsanto has argued that Brazilian growers are buying its seeds illegally and claims it has a right to recoup its lost revenue, the first GM soy seeds were smuggled into the country from neighbouring Argentina while their cultivation was still illegal in Brazil, though Brazilian officials have said only 15 per cent of growers are currently thought to buy seeds illegally.

According to the ruling in April of a judge in Rio Grande do Sul, Monsanto would have to pay back all royalties collected since 2004, which amount to an estimated $6.2 billion, or else pay out a minimum of $2 billion in compensation. On Tuesday, Supreme Court judges announced that the Southern judge’s pronouncement is applicable nationwide.

Lawyer Jane Berwanger, who is representing the farmers, commented, "Monsanto gets paid when it sell the seeds. The law gives producers the right to multiply the seeds they buy and nowhere in the world is there a requirement to pay (again). Producers are in effect paying a private tax on production."

In Europe, there is a growing movement to reform patent laws which are allowing corporations to patent organisms produced using conventional biological breeding methods. The ‘No Patents on Seeds coalition’ has warned the practice is driving agriculture in an unsustainable direction and proving detrimental to farmers, consumers, animals and plants. The coalition last month gained the support of the European Parliament, who passed a resolution supporting their message.

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