Chips In The Courtroom: Can Lay’s Patent Hold Its Crunch Against Farmers’ Rights?

Posted On - 1 February, 2024 • By - King Stubb & Kasiva

Introduction:

In the complex world of intellectual property disputes, where corporations often clash with farmers’ rights activists, a recent argument between PepsiCo and farmers in India has become the talk of the town.

The crux of the matter lies in the protection of a potato variety crucial for Lay’s potato chips- FC5. A legal rollercoaster, involving accusations of false information, patent revocations, and an ultimate court decision, has left a lingering question about the future of patent registrations and the protection of farmers’ rights under the Protection of Plant Varieties and Farmers’ Rights Act (PPVFRA), 2001.[1]

The story began when PepsiCo filed a suit against farmers in 2019 for cultivating the FC5 potato variety, later identified as FL-2027, claiming patent infringement. However, the legal tide turned when the PPVFR Authority revoked PepsiCo’s varietal registration certificate in December 2021. Activist Kavitha Kuruganti had alleged false information in the certificate, sparking a legal dispute that would unfold at the Delhi High Court.[2]

The July 2023 Single Bench judgment, siding with Kavitha Kuruganti’s claim of procedural irregularities, emphasized inconsistencies in PepsiCo’s application that potentially violated Article 15(5) of the PPVFRA[3]. This raised concerns about the potential misuse of intellectual property rights and its impact on public interest considerations within the agricultural sector. However, a recent update on January 9, 2024, revealed that a division bench (DB) nullified this decision, paving the way for the reinstatement of PepsiCo’s renewal application in accordance with the law.

The legal battle centered on diverse grounds, including PepsiCo’s alleged provision of incorrect information during registration and the public interest dilemma. The SB decision had initially dismissed the ‘public interest’ aspect, a move that drew attention to the potential hardships faced by farmers. However, the DB, in overturning the decision, highlighted the need for evidence to prove PepsiCo’s legal actions were not justifiable, emphasizing a balanced approach.

The SB’s decision, while addressing the procedural lapses, remained silent on the potential penalties for such irregularities as stipulated under Section 40 of the PPVFRA[4]. This legal grey area leaves open the question of whether PepsiCo’s actions warrant any corrective measures, potentially setting a precedent for future intellectual property disputes in the agricultural domain. The PPVFRA does offer provisions for penalties in certain situations, but the legislative gap in addressing registrar oversights and false information underscores a need for a robust mechanism.

The SB decision initially seemed like the hero in the story, receiving a pat on the back for its potential to protect farmers from corporate claws. However, the cheers turned into jeers as criticism rolled in, pointing fingers at the decision for not having enough evidence to back up its claims.

The recent DB decision, while restoring PepsiCo’s patent rights, leaves the question of procedural irregularities unanswered. The need for penalties or corrective measures to ensure the integrity of patent registrations looms large, reflecting the broader challenge of balancing corporate interests and safeguarding farmers’ rights.[5]

Recent Developments:

The DB’s reversal of the July 2023 ruling adds a new chapter to the saga. PepsiCo’s patent for the FC5 potato variety, crucial for Lay’s chips, has been reinstated, marking a significant victory for the corporation. The court’s decision highlights the need for a careful and thoughtful stance in intellectual property disputes, acknowledging both corporate interests while considering how it could affect our farmers.

Conclusion:

This dispute reflects the delicate interplay between corporate interests and farmers’ rights. The questions hanging in the air about how this affects patent registration processes and potential penalties for irregularities remain unanswered.

As India navigates the delicate balance between agricultural innovation and protecting farmers, Lay’s story serves as a poignant reminder of the need for a comprehensive and equitable legal framework.

[1] https://spicyip.com/2024/01/the-taste-of-triumph-lays-sweeps-potato-variety-ip-dispute.html.

[2] https://brandequity.economictimes.indiatimes.com/news/business-of-brands/delhi-hc-upholds-pepsico-patent-claim-for-lays-potato-variety/106691232#:~:text=The%20Delhi%20High%20Court%20on,for%20its%20Lay’s%20potato%20chips..

[3] https://plantauthority.gov.in/sites/default/files/ppvfrarules2003.pdf.

[4] https://plantauthority.gov.in/sites/default/files/ppvfrarules2003.pdf.

[5] https://legal60.com/the-taste-of-triumph-lays-sweeps-potato-variety-ip-dispute/.