Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 1 of 116
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF WISCONSIN
`
`
`The DeLong Co., Inc.
`
`
`
`
`
`
`
`Plaintiff,
`
`
`
`
`
`
`
`vs.
`
`
`
`
`
`
`
`
`
`Syngenta AG,
`
`Syngenta Crop Protection AG,
`Syngenta Corporation,
`
`Syngenta Crop Protection, LLC,
`Syngenta Biotechnology, Inc., and
`Syngenta Seeds, LLC,
`
`
`
`
`
`
`
`Defendants.
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`JURY TRIAL DEMANDED
`
`
`THE DELONG CO., INC.’S ORIGINAL COMPLAINT
`
`The DeLong Co., Inc. (“DeLong” or “Plaintiff”) for its Complaint against Syngenta AG
`
`
`Case No. 17-cv-778
`
`
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`(“Syngenta AG”), Syngenta Crop Protection AG (“Crop Protection AG”), Syngenta Corporation
`
`(“Syngenta Corp.”), Syngenta Crop Protection, LLC (“Crop Protection LLC”), Syngenta Seeds, Inc.
`
`(“Syngenta Seeds”) (now known as Syngenta Seeds, LLC), and Syngenta Biotechnology, Inc.
`
`(“Syngenta Biotech”) (now merged with Crop Protection, LLC, with Crop Protection, LLC, as the
`
`survivor) (Syngenta AG, Crop Protection AG, Syngenta Corp. Crop Protection LLC, Syngenta Seeds
`
`and Syngenta Biotech are sometimes hereinafter collectively referred
`
`to as “Syngenta” or
`
`“Defendants”), allege, on personal knowledge as to themselves and on information and belief as to all
`
`other matters, as follows:
`
`NATURE OF THE ACTION
`
`Biotechnology holds promise to potentially improve the lives of many. But it also can cause
`
`extraordinary harm if handled irresponsibly.
`
`4220914.8
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 2 of 116
`
`Part of acting responsibly requires that biotechnology companies avoid introducing a new
`
`genetic trait into the market prematurely before it has been approved in all significant export markets.
`
`All in the industry, including Syngenta, recognize that premature commercialization can cause
`
`significant trade disruptions and enormous harm to farmers and other industry participants. That is why
`
`they have pledged to each other and to other stakeholders, including both corn farmers and other
`
`industry participants, that they will act responsibly in introducing new bio-engineered genetic traits into
`
`the market.
`
`Syngenta had the opportunity to act responsibly in 2010. Its new genetically modified corn
`
`Agrisure Viptera®, containing the MIR162 genetic trait, had just been deregulated by the United States
`
`Department of Agriculture (“USDA”). But Syngenta was aware that a large and growing export market
`
`for U.S. corn and corn products, China, had not approved MIR162. In fact, Syngenta had only that same
`
`year sought regulatory approval in China, and at the time, the average time for regulatory approval in
`
`China was 2-3 years. The process is longer if applications are incomplete or incorrect. And Syngenta’s
`
`were. Syngenta had been previously warned by industry participants not to introduce another MIR
`
`genetic trait because of lack of approval in export markets, and the devastating consequences that could
`
`occur from such premature commercialization.
`
`But Syngenta also knew that the clock was ticking on expiration of its patent for this genetic
`
`trait. Every year that passed without commercialization meant lost monopoly profits granted by patent.
`
`Syngenta had a decision to make. It could wait until China approved its new genetic trait and
`
`temporarily forego its monopoly profits. That is what it had pledged to do, and what responsible
`
`practice in any event dictated. Or Syngenta could immediately commercialize Agrisure Viptera®, and
`
`create an enormous risk that U.S. corn farmers (also known as “Producers” as defined in the Court’s
`
`4220914.8
`
`2
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 3 of 116
`
`March 10, 2015 Order (ECF No. 287 at 4) and other industry participants (also known as “Non-
`
`Producers”) would lose one of their large and growing export markets.
`
`Sadly, Syngenta opted for its monopoly profits over responsibility to its stakeholders. It chose to
`
`commercialize Viptera® for the 2011 crop year knowing that China would not approve MIR162 until
`
`sometime after that trait had entered export channels.
`
`During 2011 – 2013, Syngenta was called upon again by industry participants to show
`
`responsibility and stop its overly aggressive commercialization. China’s importance as a purchaser of
`
`U.S. corn and corn products had continued to grow and it still had not approved MIR162. Syngenta’s
`
`response was to expand sales for the 2012 and 2013 growing seasons, and capture more monopoly
`
`profits.
`
`In November 2013, the very occurrence that had been foreseen by industry participants,
`
`including Syngenta, occurred. U.S. exports to China were found to be contaminated with MIR162,
`
`which still had not been approved by China. China therefore began rejecting shipments of corn from the
`
`U.S. Shipment of distillers dried grain with solubles (DDGS), a byproduct of corn ethanol production
`
`sold by many industry participants, were similarly rejected and became subject to a prohibitive
`
`certification process in the summer of 2014.
`
`After rejection of U.S. corn and corn product shipments, industry participants in early 2014
`
`demanded that Syngenta immediately halt commercialization of Agrisure Viptera®. They also
`
`demanded that Syngenta not commercialize a brand new product, Agrisure Duracade™, which also
`
`contained MIR162 and a new event, not approved by China and other export markets -- Event 5307.
`
`The industry participants pointed out that they were “gravely concerned about the serious economic
`
`harm” to those in the industry, including both corn Producers and Non-Producers, caused by the loss of
`
`4220914.8
`
`3
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 4 of 116
`
`the Chinese market. At that time, the National Grain and Feed Association quantified the economic
`
`harm as already ranging from $1 billion to $2.9 billion.
`
`Syngenta doubled down. It continued to sell Agrisure Viptera®, and launched Agrisure
`
`Duracade™ for the 2014 crop year, thereby prolonging the economic harm indefinitely. Those
`
`irresponsible actions also ensured that the economic losses to farmers and others in the industry would
`
`continue to grow.
`
`These events show corporate greed at its worst. But there is more. To attempt to minimize the
`
`perceived impact of its conduct, Syngenta actively misled farmers, industry participants and others about
`
`the importance of the Chinese market, the timing and substance of its application for approval in China,
`
`the timing of when China was likely to approve MIR162, its ability to “channel” Viptera® to non-
`
`Chinese markets and otherwise contain the infiltration of Viptera® into the U.S. corn supply and other
`
`issues described below. In fact, even though it represented to the USDA and the public that “there
`
`should be no effects on the U.S. maize export market” from deregulation and that it would impose
`
`stewardship and channeling requirements to steer Viptera® corn away from export markets that had not
`
`approved it, Syngenta did not follow through in any meaningful way on this commitment. Just the
`
`opposite. When one company – Bunge North America, Inc. (“Bunge”) – tried to minimize the risk that
`
`Viptera® would be found in shipments to China by refusing to accept it, Syngenta sued Bunge in an
`
`effort to force it to take Viptera®. Syngenta was far more concerned about the impact on its business
`
`than it was about the loss of an important export market for the corn industry.
`
`Under the basic laws of supply and demand, when there is less demand for a product, the price is
`
`lower than it otherwise would be. China was a large and growing export market, and was predicted by
`
`the USDA to be our largest export market for corn by 2020. China was also a large and growing market
`
`for DDGS, which are also sold by many Non-Producers. The loss of these markets has caused
`
`4220914.8
`
`4
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 5 of 116
`
`enormous economic harm to U.S. corn Producers and Non-Producers, and that harm is continuing to
`
`grow. While China finally approved MIR162 in December 2014, it has not approved Event 5307. U.S.
`
`corn exports to China have not yet begun to recover, and it remains to be seen whether they will ever
`
`regain the levels they would have attained but for the embargo.
`
`Those injured by Syngenta’s conduct fall into two groups: (a) Producers (farmers and others
`
`actually involved in the production of U.S. corn) who grow corn and sell it to other market participants;
`
`and (b) all of the other Non-Producer market participants affected by the drop in corn prices and/or the
`
`rejection of U.S. corn and corn by-products in foreign markets because of the presence of MIR162. This
`
`Complaint sets forth the claims of DeLong, a Non-Producer. With this Complaint, Plaintiff seeks
`
`compensation for losses it has suffered as a result of Syngenta’s irresponsible conduct, and punitive
`
`damages for Syngenta’s reprehensible and outrageous behavior.
`
`JURISDICTION AND VENUE
`
`This Court has jurisdiction over this case under 28 U.S.C. § 1331, 28 U.S.C. §
`
`1.
`
`1332(a)(1)-(3), and 15 U.S.C. § 1121(a) in that claims are asserted under § 43(a) of the Lanham Act, 15
`
`U.S.C. § 1125(a).
`
`2.
`
`In the further alternative, this Court has supplemental jurisdiction over this case under 28
`
`U.S.C. § 1367(a).
`
`3.
`
`Venue is proper in the Western District of Wisconsin pursuant to 28 U.S.C. § 1391(b)(2)
`
`because DeLong suffered damages in this District due to Defendants’ conduct. Additionally, venue is
`
`also proper the Western District of Wisconsin pursuant to 28 U.S.C. § 1391(b)(2) because Defendants
`
`have marketed, sold, or otherwise disseminated, and continue to market, sell, or otherwise disseminate
`
`Viptera® and Duracade™ corn in this District.
`
`4220914.8
`
`5
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 6 of 116
`
`PARTIES
`
`4.
`
`Plaintiff DeLong is a Wisconsin corporation with its corporate headquarters and principal
`
`place of business at 513 Front St., PO Box 552, Clinton, Wisconsin 53525, located in Rock County,
`
`Wisconsin. Over the years, DeLong developed an extensive network of grain elevators and grain
`
`handling and processing facilities (including loading facilities, rail terminals, river terminals and port
`
`elevators) and transportation assets (including trucks, rail cars, containers and barges) primarily in the
`
`Midwest that it uses to buy, store, clean, process, and transport agricultural commodities, including corn,
`
`that DeLong purchases directly from farmers. DeLong exports significant amounts of corn (and beans)
`
`to Asia. DeLong also developed a significant business in “DDGs” from ethanol plants that it sells for
`
`livestock feed. DeLong became one of the largest exporters of DDGs to China as China’s growing
`
`population and burgeoning middle class created significant demand for corn and corn by-products
`
`including DDGs (due to pork consumption skyrocketing in China in the last 10 years). DeLong made
`
`substantial investments to support its growing export business to China.
`
`5.
`
`Syngenta AG is a corporation organized and existing under the laws of Switzerland with
`
`its principal place of business at Schwarzwaldallee 215, 4058 Basel-Stadt, Switzerland. Syngenta AG is
`
`a publicly traded company on the Swiss stock exchange. American Depository Receipts for Syngenta
`
`AG are traded on the New York Stock Exchange. Syngenta AG was formed in 2000 as a result of the
`
`merger of Novartis Agribusiness and Zeneca Agrochemicals and is the only publicly traded company
`
`among the various Syngenta entities named as defendants in this case. Service of Syngenta AG with
`
`process under Fed. R. Civ. P. 4(h)(2) and 4(f)(1), and in accordance with the Hague Convention on the
`
`Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, may be made
`
`by forwarding two copies of the citation and the Complaint in English, along with two copies of the
`
`citation and the Complaint translated into German, to: Appellationsgericht, Basal-Stat, Baumleingasse1,
`
`4220914.8
`
`6
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 7 of 116
`
`4051 Basel, Switzerland. This Complaint may be served upon Syngenta AG under Fed. R. Civ. P.
`
`5(b)(2)(C) by mailing a copy of it to Syngenta AG at its principal place of business noted above.
`
`6.
`
`Crop Protection AG is a corporation organized and existing under the laws of
`
`Switzerland with its principal place of business at Schwarzwaldallee 215, 4058 Basel-Stadt,
`
`Switzerland. Service of Crop Protection AG with process under Fed. R. Civ. P. 4(h)(2) and 4(f)(1), and
`
`in accordance with the Hague Convention on the Service Abroad of Judicial and Extrajudicial
`
`Documents in Civil or Commercial Matters, may be made by forwarding two copies of the citation and
`
`the Complaint in English, along with two copies of the citation and the Complaint translated into
`
`German, to: Appellationsgericht, Basal-Stat, Baumleingasse1, 4051 Basel, Switzerland. This
`
`Complaint may be served upon Crop Protection AG under Fed. R. Civ. P. 5(b)(2)(C) by mailing a copy
`
`of it to Crop Protection AG at its principal place of business noted above.
`
`7.
`
`Syngenta Corporation is a Delaware corporation with a principal place of business at
`
`3411 Silverside Road #100, Wilmington, Delaware 19810-4812. Syngenta Corp is a subsidiary of
`
`Syngenta AG. Syngenta Corp. does not have a registered agent in the State of Wisconsin and may be
`
`served with process under Rule 4(h)(1)(A) and (B) by sending by registered or certified mail the citation
`
`and this Complaint to: Cheryl Quain (or successor), Corporate Secretary, Syngenta Corporation, 3411
`
`Silverside Road, Suite 100, Shipley Building, Wilmington, Delaware 19810, and The Corporation Trust
`
`Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.
`
`8.
`
`Crop Protection, LLC is a limited liability company organized and operating under the
`
`laws of the State of Delaware with its principal place of business at 410 Swing Road, Greensboro, North
`
`Carolina 27409-2012. Crop Protection, LLC may be served under Fed. R. Civ. P. 4(h)(1)(A) by and
`
`through its registered agent, C T Corporation System, 301 S. Bedford St. Suite 1, Madison, Wisconsin
`
`53703.
`
`4220914.8
`
`7
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 8 of 116
`
`9.
`
`Syngenta Seeds LLC (“Syngenta Seeds”), formerly a Delaware corporation with a
`
`principal place of business at 11055 Wayzata Boulevard, Minnetonka, Minnesota 55305-1526, is now a
`
`Delaware limited liability company with Syngenta Corp. as its sole member. Syngenta Seeds is a direct
`
`subsidiary of Syngenta Corp. It may be served under Fed. R. Civ. P. 4(h)(1)(A) by and through its
`
`registered agent, C T Corporation System, 301 S. Bedford St. Suite 1, Madison, Wisconsin 53703.
`
`Syngenta Seeds has described itself in its Complaint filed in Syngenta Seeds, Inc. v. Bunge North
`
`America, Inc., No. 5:11-cv-04074-MWB, United States District Court, Northern District of Iowa
`
`(“Bunge” or “Syngenta v. Bunge”), as
`
`a leading agribusiness company committed to sustainable agriculture through research
`and technology. Syngenta is, among other things, in the commercial seed business. It
`develops, produces, and sells, through dealers and distributors or directly to growers, a
`wide range of agricultural products, including corn and soybean seed exhibiting useful
`traits that have been developed with the techniques of modern biotechnology. The seed
`products are then grown and harvested as raw materials for the production of biofuels or
`grain for livestock feed; or are milled and processed for food products.
`
`Among Syngenta Seeds’ products which it has sold in the State of Wisconsin, and elsewhere, including
`
`states in which DeLong has operations, are the Agrisure Viptera® and Agrisure Duracade™ corn
`
`seeds. These seeds express, or contain, genetically engineered traits which confer resistance to insects.
`
`10.
`
`Syngenta Biotech, formerly a corporation organized and existing under the laws of the
`
`State of Delaware with its principal place of business located at P.O. Box 12257, 3054 East Cornwallis
`
`Road, Research Triangle Park, North Carolina 27709-2257, has now merged into Crop Protection, LLC,
`
`with Crop Protection, LLC as the surviving entity. Syngenta Biotech, prior to its merger with Crop
`
`Protection, LLC, was a subsidiary of Syngenta Seeds and traces its operations back to CIBA-Geigy
`
`Corporation, a legacy company of Syngenta. Syngenta Biotech may be served under Fed. R. Civ. P.
`
`4(h)(1)(A) by and through its registered agent, C T Corporation System, 301 S. Bedford St. Suite 1,
`
`Madison, Wisconsin 53703.
`
`4220914.8
`
`8
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 9 of 116
`
`11.
`
`Syngenta AG wholly owns, directly or indirectly, each of Crop Protection AG,
`
`Syngenta Corp., Crop Protection LLC, Syngenta Biotech and Syngenta Seeds.
`
`12.
`
`Syngenta AG represents itself as a global company. According to Syngenta’s own
`
`website, Syngenta AG’s Board of Directors “has full and effective control of the company and holds
`
`ultimate responsibility for the company strategy.”
`
`13.
`
`One or more members of Syngenta AG’s Board of Directors or Executive Committee
`
`established by the Board of Directors also serve as member(s) of the Board of Directors of Crop
`
`Protection AG, Syngenta Corp., Crop Protection LLC, Syngenta Biotech and/or Syngenta Seeds.
`
`14.
`
`Furthermore, Syngenta AG’s Executive Committee formulates and coordinates the
`
`global strategy for Syngenta businesses, and maintains central corporate policies requiring Syngenta
`
`subsidiaries, including those named as Defendants herein, under the general guidance of the Syngenta
`
`group control.
`
`15.
`
`Employees of the Syngenta group as a whole maintain reporting relationships that are
`
`not defined by legal, corporate relationships, but in fact cross those corporate lines. For example,
`
`Crop Protection AG maintains two separate product lines – Seeds and Crop Protection – that cross the
`
`Defendants’ separate legal, corporate existences.
`
`16.
`
`The Defendant subsidiaries are subject to additional oversight that requires them to
`
`seek approval for certain decisions from higher levels within the functional reporting structure –
`
`including in some instances Syngenta AG. Appointments of senior management personnel for the
`
`Defendant subsidiaries also may require, in certain instances, approval from individuals or governing
`
`bodies that are higher than each subsidiary’s respective board of directors.
`
`4220914.8
`
`9
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 10 of 116
`
`17. Moreover, Syngenta AG and Syngenta Crop Protection AG management were intimately
`
`involved in, and in some instances directed, decisions concerning the commercialization of Viptera®
`
`without Chinese approval.
`
`18.
`
`Also, Syngenta AG maintains a central global finance function that governs all
`
`Defendants. Thus, the Defendant subsidiaries do not function independently but under the Syngenta
`
`AG umbrella.
`
`19.
`
`In addition, Syngenta entities regularly refer to themselves as “Syngenta,” with no
`
`further description.
`
`20.
`
`Thus, the respective jurisdictional contacts of Crop Protection AG, Syngenta Corp.,
`
`Crop Protection LLC, Syngenta Biotech and Syngenta Seeds in the forum state(s) are attributable to
`
`Syngenta AG because of the unusually high degree of control Syngenta AG exercises over these
`
`subsidiaries. See, e.g., City of Greenville v. Syngenta Crop Protection, Inc. et al., 830 F. Supp. 2d 550
`
`(S.D. Ill. 2011).
`
`21.
`
`In addition, upon information and belief, the Defendants acted in concert pursuant to
`
`agreements or other arrangements to act in a collective manner and/or as joint venturers regarding the
`
`actions and events made the subject of this Complaint. All Defendants are therefore jointly and
`
`severally liable for the acts for which the Plaintiff makes complaint.
`
`4220914.8
`
`10
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 11 of 116
`
`
`
`FACTUAL ALLEGATIONS
`
`22.
`
`Biotechnology firms such as Syngenta develop and obtain patents on their bio-engineered
`
`products, in this instance seeds. These products are also referred to as genetically-modified organisms,
`
`or “GMOs.” A patent gives the biotechnology firm the exclusive right to sell its bio-engineered
`
`products; however, those patents eventually expire. Biotechnology seed firms therefore have an
`
`economic incentive to “commercialize” (i.e. bring their products to market for planting and harvest) as
`
`soon as possible after filing a patent application in order to maximize profitability.
`
`23.
`
`According to Grant Ozipko, the goal set by Syngenta’s senior leadership (including
`
`Charles Lee, David Morgan, Steve Ligen and/or Diane Mayhart) was to achieve 9.5% market share for
`
`MIR162 by 2014. See Grant Ozipko Deposition (10/19/12) (Bunge) at 72-73. Syngenta was concerned
`
`with “commercialization as soon as possible.” See MIR162H-I Stage gate progression review dated
`
`December 16, 2009.
`
`24.
`
`But premature commercialization poses well-known and significant risks of harm to
`
`farmers and industry participants if bio-engineered commodity products are commercialized before they
`
`are approved by major importing nations. Certain importing nations, such as China, have a “zero
`
`tolerance” policy and will reject grain and/or grain product imports from the U.S. upon detecting the
`
`presence of even trace amounts of an unapproved bio-engineered genetic trait in U.S. grain or grain
`
`product shipments. This was well known by participants in the biotechnology industry, including
`
`Syngenta, before, but at least by, 2007.
`
`25.
`
`Syngenta commercialized MIR162 – and Event 5307 – despite clear risk of harm to its
`
`stakeholders (including the Plaintiff), Syngenta’s knowledge of that risk, and Syngenta’s own professed
`
`commitment to responsible management.
`
`4220914.8
`
`11
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 12 of 116
`
`26. Moreover, Syngenta commercialized MIR162 by consistently misrepresenting the
`
`importance and status of China’s approval and without adequate systems in place to isolate or channel
`
`MIR162, virtually assuring that MIR162 would contaminate the U.S. corn supply, as set out below.
`
`Recognized Risks Of Irresponsible Commercialization
`
`27.
`
`As recognized within the industry, and by Syngenta, the harm threatened by irresponsible
`
`commercialization is very real.
`
`28.
`
`“There have been a number of high-profile cases involving genetically modified varieties
`
`. . . and disruption of international shipments of commodity grains such as corn, wheat, and rice.”
`
`http://www.syngentafoundation.org/index.cfm?pageID=703.
`
`29.
`
`High profile examples of irresponsible commercialization of bio-engineered seeds
`
`include “StarLink” bio-engineered corn that contaminated the U.S. corn supply in 2000 and thereby
`
`disrupted international trade, causing loss to farmers and other industry participants. In re StarLink
`
`Corn Products Liability Litigation, 212 F. Supp. 2d 828 (N.D. Ill. 2002).
`
`30.
`
`In 2006, bio-engineered rice contaminated the U.S. rice supply, again disrupting trade
`
`and causing massive damages to U.S. rice farmers and other industry participants. See, e.g., In re
`
`Genetically Modified Rice Litig., 666 F. Supp. 2d 1004 (E.D. Mo. 2009); Bayer CropScience LP v.
`
`Schafer, 2011 Ark. 518, 385 S.W.3d 822, 832 (Ark. 2011).
`
`31.
`
`In addition to being aware of these and other well-publicized incidents and lawsuits at the
`
`time Syngenta decided to commercialize MIR162, Syngenta had (and has been) continuously warned by
`
`stakeholders about the importance of, and need for, responsible commercialization.
`
`32.
`
`For example, when Syngenta commercialized MIR604 (Agrisure® RW) in 2007, the
`
`National Grain and Feed Association (“NGFA”) (of which Syngenta is a member) and the North
`
`American Export Grain Association (“NAEGA”) warned against an “‘ill-conceived’ plan to
`
`4220914.8
`
`12
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 13 of 116
`
`commercialize” Syngenta’s Agrisure biotechnology-enhanced corn as endangering U.S. corn and corn-
`
`product exports since it had not obtained regulatory approval for food and feed use in Japan and other
`
`U.S. export markets. Houin, “Feed and grain organizations warn growers of limited export markets,”
`
`Farm World (4/25/2007).
`
`33.
`
`The International Grain Trade Coalition also chastised Syngenta, stating that Syngenta
`
`“did not respect the responsibility of importing governments to perform necessary risk assessments as
`
`demanded by their legislation,” that the introduction of Agrisure® RW “was not done in an open
`
`transparent manner,” and that Syngenta “did not complete authorization in major international markets
`
`possessing scientifically sound approval systems prior to commercialization.” Letter from International
`
`Grain Trade Coalition to Michael Pragnell, CEO Syngenta dated April 18, 2007 at 2. The International
`
`Grain Trade Coalition further stated that Syngenta’s conduct “[e]xposed downstream members of the
`
`value chain including producers, handlers, exporters, importers, food processors and distributors to
`
`significant liability as currently all countries employ a zero threshold policy for an event not authorized
`
`by the importing country” and strongly urged Syngenta to “reverse immediately its decision to
`
`commercialize Agrisure RW at this time.” Id.
`
`34.
`
`The Biotechnology Industry Organization (“BIO”) is the world’s largest biotechnology
`
`trade association, of which, on information and belief, Syngenta is or was a member. BIO has expressly
`
`recognized that “[a]synchronous authorizations combined with importing countries maintaining ‘zero
`
`tolerance’ for recombinant-DNA products not yet authorized results in the potential for major trade
`
`disruptions.” BIO, Product Launch Stewardship Policy, May 21, 2007, at Annex 1 Introduction; see also
`
`BIO Product Launch Stewardship,” December 10, 2009, at Annex 1 Introduction (same); BIO
`
`“Stewardship: Actions to be Taken Prior to Launching Special Traits,” October 4, 2010, at Annex 1
`
`4220914.8
`
`13
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 14 of 116
`
`Introduction (same); BIO “Product Launch Stewardship: Food and Agriculture Section,” November 27,
`
`2012, at Annex 1 Introduction (same).
`
`35.
`
`As stated in BIO’s “Product Stewardship Policy” dated December 10, 2009:
`
`introduction of biotechnology-derived plant
`the commercial
`Since
`products in 1996, an increasing number of biotechnology-derived plant
`products intended for food or feed use are authorized for commercial
`production
`in many countries
`throughout
`the world; however,
`authorizations in importing countries vary depending on the timing of
`submissions for import authorization as well as the duration of the
`authorization process in each country. As a consequence of these
`asynchronous authorizations, low levels of recombinant-DNA plant
`materials that have completed full safety assessments in accordance with
`national and international standards in one or more countries may, on
`occasion, be present in food or feed in countries in which the authorization
`process of the relevant recombinant-DNA plant material has not been
`completed.
`importing countries
`Asynchronous authorizations combined with
`maintaining ‘zero tolerance’ for recombinant-DNA products not yet
`authorized results in the potential for major trade disruptions.
`
`
`http://www.bio.org/sites/default/files/Product_Launch_Stewarship_12_10_09.pdf.
`
`Recognized Stewardship Obligation
`
`36.
`
`The risks of premature commercialization are well-recognized within the industry and as
`
`a result agricultural biotechnology organizations, including CropLife International (of which Syngenta is
`
`a member) and BIO have developed stewardship standards under which bio-technology firms refrain
`
`from commercializing their products before those products are approved by importing nations.
`
`37.
`
`The very genesis of BIO’s Product Launch Stewardship Policy in 2007 was Syngenta’s
`
`own launch of MIR604 without Japanese import approval. See John Bernens Deposition (11/2/12)
`
`(Syngenta Seeds, Inc. v. Bunge North America, Inc., No. 5:11-cv-04074-MWB (N.D. Iowa Aug. 22,
`
`2011)) at 110-113; see also Email from Sarah Hull to Jane Backmann and Anne Burt dated February 19,
`
`2008 (“While I know we will be ready to sell MIR162 in the US in 2009, it seems we won’t have the
`
`stacks approved in Japan to fully launch the product without managing some trade implications. This is
`14
`
`4220914.8
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 15 of 116
`
`where grain traders were so upset with the [Agrisure] RW launch. We commercialized without having
`
`Japan approval prior to planting. That in turn spawned the BIO policy.”).
`
`38.
`
`Syngenta has, since at least 2007, represented that it is “committed to the principles of
`
`good stewardship, which are exemplified through the responsible management of [its] products across
`
`their lifecycle [including] commercialization” and its support for BIO’s Product Launch Stewardship
`
`policies. See Bio Product Launch Policy, Syngenta Implementation Principles (Nov. 2007)
`
`http://www.syngentabiotech.com/biopolicy.aspx. On information and belief, Syngenta’s Jeff Cox
`
`expressly indicated Syngenta’s support for this policy and pledged that “we will implement it with
`
`Syngenta.”
`
`39.
`
`Under the BIO stewardship policy, developers like Syngenta should meet applicable
`
`regulatory requirements in key markets prior to commercialization. See BIO Product Launch
`
`Stewardship, December 10, 2009, at 4.
`
`40.
`
`Under the BIO policy, developers also should:
`
`Conduct a market and trade assessment to identify key import markets,
`including those with functioning regulatory systems, prior to the
`commercialization of any new biotechnology product (crop by event) in
`any country of commercial launch. In that market and trade assessment,
`consult at an early stage with the value chain for the specific crop.
`Manage the product’s introductions so that choice of production
`methods
`(coexistence) and markets
`(e.g.,
`specialty,
`identity
`preservation, and global) for that crop are available and preserved.
`Id. (emphasis added).
`
`Under the BIO policy in 2009, key markets included “at minimum” the United States,
`
`41.
`
`Canada, and Japan. Id. (emphasis added).
`
`42.
`
`For purposes of the BIO policy, “commercialization” means the first planting of seed for
`
`the production of a crop or crop product. See BIO Product Launch Stewardship, December 10, 2009, at
`
`4 n.4. See also Email from Sarah Hull to Jane Bachmann and Anne Burt dated February 19, 2008
`
`4220914.8
`
`15
`
`

`

`Case 2:17-cv-02614-JWL-JPO Document 1 Filed 10/11/17 Page 16 of 116
`
`(commercialization is defined in BIO policy as the first planting of seed sold into commerce for the
`
`production of a crop).
`
`43.
`
`BIO policies are minimum standards of responsible behavior. BIO expressly states that
`
`its policy “does not limit the implementation of additional measures designed to facilitate adoption and
`
`use of [commodity crop] products and to prevent disruption of . . . the trading of the commodity.” BIO
`
`Product Launch Stewardship, December 10, 2009, at 4.
`
`44.
`
`Another biotechnology industry association, Excellence Through Stewardship, advocates
`
`similar
`
`standards
`
`through
`
`its
`
`“Product
`
`Launch
`
`Stewardship
`
`Guide.”
`
`http://excellencethroughstewardship.org/wp-content/uploads/Approved-Product-Launch-Stewardship-
`
`Guide-Revised-07-22-10.pdf. Syngenta is a “founding member” of Excellence Through Stewardship.
`
`www.syngentabiotech.com/biostewardship.aspx.
`
`45.
`
`Biotechnology industry groups are not alone in recognizing the importance of
`
`stewardship. The National Grain and Feed Association’s Policy on Agriculture Biotechnology provides:
`
`The NGFA supports agricultural biotechnology and other scientific
`advancements that promote safe and abundant food and feed supply.
`However, the NGFA believes biotech-enhanced traits should be
`commercialized only after achieving broad, deep consumer
`ac