ANSWERING THE QUESTION I HEAR MOST OFTEN
The Answer Should Be a Simple No – It Partly Is, But Only Partly
I get the best blog ideas by talking with people at meetings and conventions, and I was most recently at the Cultivation Classic, a Cannabis meeting in Portland, Oregon. There was a sort of widespread anger and group-wide cohesiveness in the gathering that made me think I could relate, just a little, with the people who joined the Boston Tea Party way back when — a sense that this group was going to find a way to join forces and overcome some pretty big odds, having become more fully aware of and sensitized to what was at stake.
I was asked a lot of questions about the power of patents in the hands of “Big Ag” — whether and to what extent they could be used oppressively to disenfranchise the “little guy” and essentially take away what little he or she previously had. Like a lot of things, there are some straightforward answers that are literally correct but that miss the point. Here is one example of a common question and its literally correct answer that mostly misses the point, followed by an explanation that takes into account real-life experience.
The Ultimate FAQ
Question: Can Monsanto (or insert your least-trusted “Big-Cannabis” counterpart here) use patents to make me stop growing my own plants?
(Let’s assume the person asking this question is referring either to 1) cultivars they originated with their own breeding, or 2) public-domain cultivars.)
Answer: No, that’s not how patents work. Since your plants already belong to you or are public domain, it is not possible for Big Cannabis to obtain a valid patent that covers them, so they could never use patents to make you stop growing your own plants. Big Cannabis will certainly get its own patents, but they will be on their own cultivars and/or other inventions — not patents that cover the plants you are using right now. You can keep growing what you have always grown and you will be in a “safe harbor” that will be a patent-free zone (unless you choose to file for patent protection of your own on the crosses you originated). Even then, those patents will be yours — not someone else’s — so, still, you will be fine in terms of risks from someone else.
What’s Wrong With That Answer?
OK, that’s a nice, thorough answer — what could possibly be wrong with it?
The problem with the answer is that it’s legally correct but not complete. In terms of what Big Cannabis can do by combining its IP strategies and its market power in a commodity market, it CAN reach the result you are concerned about. If you end up growing Cannabis to compete in a commodity market, you may well end up having to stop growing your own plants. It won’t be because your plants are infringing their patents. It will be very much because of the IP strategies of Big Cannabis — because your plants can’t compete with their plants in the commodity market. This might sound familiar.
Commodity Agriculture and Markets
Let’s look at other commodity agriculture and related IP strategies. Obviously this is simplified because this is a blog rather than an econ class, but you’ll get the point.
“BigAgCo” makes a very effective pesticide and a very effective weed killer. If you use both, you have almost no crop loss from bugs, almost no labor cost from eliminating weeds, and lower water consumption from competing weeds. You can produce more soybeans per acre. But the weed killer also kills any soy plants unless they are the patented GMO kind engineered to resist the weed killer.
Farmer Ann has a public-domain variety of soy seeds that she wants to grow, rather than paying for patented GMO seeds and using BigAgCo’s products. Farmer Bob heard the BigAgCo sales pitch and paid a higher price for the GMO seeds and the pesticide and weed killer. Farmer Bob saved a lot on labor and water and had a higher yield per acre, as did a lot of other farmers who also heard the sales pitch. All these farmers sold their seeds for a price less than Farmer Ann’s cost of production. Farmer Ann has a choice to either sell her seeds at a loss or not sell them at all.
Farmer Ann’s Seeds Aren’t “Special” to the Market
This is how commodity markets work: they see all the seeds as being interchangeable and simply don’t care that Farmer Ann’s seeds were farmed differently than those of the other farmers. In this example there is no demand for “clean soy”, so Farmer Ann’s seeds can’t be differentiated from those of the other farmers. This is obviously not true in all cases, but this example is specifically about the power that BigAgCo has in commodity markets.
The following year Farmer Ann has a choice — she can either try her approach again and hope that some other forces push the price of soy higher so that she can survive; or she can surrender to the fact that — unless she embraces the “superior” products being offered by BigAgCo — those very products will eventually drive her out of business. But Farmer Ann will face those same grim options year after year, as long as she is growing a commodity crop serviced by BigAgCo that is making money using a concerted IP strategy designed to force mass-compliance in its market.
Forces Big Enough to Drive Choices
As I said, this is an oversimplification. There are many other factors, including competition among Big Ag companies, market fluctuations, patent expirations, etc.; but my message is that, while Big Ag cannot march in and make you stop growing your own plants directly by using the patent system, Big Ag can and does cause farmers to alter their choices about what to grow, based on a combination of market forces and IP strategies in commodity markets.
That is a very unhappy answer, isn’t it? So what is to be done? Start dumping tea into the harbor? Well, yes, sort of — intelligently, strategically, and calmly. So, yes — let’s talk about a ‘Tea Party.’
Don’t Become An Edible
Here are some suggestions to avoid getting sucked into the giant Big Cannabis machine and spit out the other end as an unrecognizable edible for mega-investors who have never been within 50 miles of a real pot farm.
- Consider what you are growing and how likely it is to become commoditized. Is it going to become an isolate that is indistinguishable from every other isolate? Or is it a unique strain/cultivar that will be valued for its chemotype and full-spectrum properties?
If you have any way to do so, grow plants and make products that will not be part of a commodity market; at least move in that direction as soon as you can. By staying out of commodity markets, you will not be under the same market pressures to buy patented Big Cannabis seeds to survive the competition from season to season.
- Talk to, work with, and support other members of the industry who are in the same situation. The industry is young enough, and the regulations and markets are new enough or still unwritten, that it might still be possible for the power of a very large coalition of small players to counterbalance to the power that already exists with Big Cannabis.
This is especially important if your business model doesn’t let you do #1. Some people who want to stay out of Big Cannabis may, for one reason or another, be stuck in a commodity market. So they need to become part of a group that is strong enough to somehow counterbalance Big Cannabis. Can this be done from a market and IP perspective? I think it would be hard but not impossible, and the time is right to really try to do this.
Unifying to Counter the Forces of Big Cannabis
There are groups trying to form a viable alternative to Big Cannabis — something real to unify everyone after the “Portland Tea Party.” Hopefully there is enough trust left within the community so this can happen. Thinking back to the original Tea Party, the separate colonies didn’t have a lot of power until they were pissed off enough to set aside their differences and unite to protect their common interests against a power that was somewhere between indifferent to and hostile to their interests.
The soy and corn farmers that fell victim to the Big Ag strangleholds didn’t have any warnings or lessons from history. They couldn’t know that the combination of sophisticated IP strategies and commodity-market forces would work together to take away any real choices they would have.
But today’s independent Cannabis breeders and growers can learn lessons from soy and corn farmers who have, in practical terms, lost their freedom to choose whether to plant non-patented seeds. Protecting the common interests of Small Cannabis is worth doing. It can be done. There is reason for optimism.
United Small Cannabis – Catchy Name?
“United Small Cannabis” can’t just bring a blunt to a gunfight, though. To be able to stand up to and effectively counter the power of Big Cannabis, United Small Cannabis needs to be able to navigate the IP system and develop strategies of its own to block Big Cannabis from taking over the whole industry. This sort of battle strategy is way too much to tackle at the end of this blog, though, so stay tuned. And please send in your suggestions and thoughts to DHunt@PlantAndPlanet.com.
By Dale Hunt – The opinions expressed here are the author’s own and do not necessarily reflect those of his professional colleagues or his clients. Nothing in this post should be construed as legal advice. Meaningful legal advice can only be provided by taking into consideration specific facts in view of the relevant law.
Fantastic synopsis of a key risk. Thanks for this work!