Thursday, June 17, 2010

[Honeycrisp Apple, U license fee to (all) growers = $1.65.
The patent is running out so we cross HC and Zestar = SweeTango.
Shazam! New revenue stream. Higher licensing fees.]

Strib Headline Writer Hits Home Run

"U's hot new apple already made into tort..."

But seriously folks, another example of the Morrill Hall Gang's being mean and greedy and, when exposed, trying to appear to take the [pseudo] high road.

From the Strib:

Not since Adam and Eve has an apple caused so much furor.

[slight overstatement]

More than a dozen apple growers filed a lawsuit in Hennepin County District Court Wednesday over an exclusive licensing agreement that the University of Minnesota and Pepin Heights Orchard have struck over what's being touted as the latest and greatest apple to hit the market -- the SweeTango.

... the growers who filed the suit argue the university's licensing agreement with Pepin severely limits their ability to grow, sell and ultimately profit from the SweeTango, a cross between the Honeycrisp and Zestar varieties.

The growers complain that the deal limits the number of trees other orchards can grow and allows them to sell only directly to consumers or individual stores rather than through the wholesalers who are an essential source of revenue for most orchards. The deal also prevents smaller growers from pooling their crops to fill orders from large retail stores.

[restraint of trade?]

"Such restrictive limitations ... result in unfair competition likely to force some of [the growers] out of business and significantly impair efforts of other Minnesota apple growers to remain viable," the suits says.

[I thought the U of M was supposed to be an economic engine for the people of the state? Isn't that what's claimed at the lege?]

The lawsuit points out that state funding was used to help develop the SweeTango.

University spokesman Daniel Wolter said Wednesday night that officials there are reviewing the lawsuit.

[That Dan Wolter? And this apple unhappiness has been known to the U for quite some time. See Daily editorial: Sweet Tango a Rotten Deal, 9/23/09 ]

University officials say the more restrictive limits on the SweeTango are meant to maintain high quality standards that will better protect the long-term value of the product as well as provide revenue for horticulture research at time when other revenue streams are dwindling.

[High quality standards, cough, cough. I understand the U made $8mil for HoneyCrisp. Would not a figure in that ball park be reasonable, rather than gouging the small orchards and putting some of them out of business? This is a strange position to take for an institution that claims to be an economic engine for the state.]

... Lisa Lamm Bachman, an attorney representing the growers and others in the lawsuit, said the exclusive deal is "unprecedented" and violates public policy, state and federal anti-trust laws and constitutional guarantees of equal protection under the law. She also contends the restrictions promote unfair competition, and create consumer confusion.

[Wow, now there's a load of buckshot.]

Kenneth Port, law professor and director of the Intellectual Property Institute at William Mitchell College of Law, said such licensing agreements -- even exclusive ones -- are "very common."

But Port said one hitch in the Pepin deal may be a written university policy that establishes that university research should have the maximum possible beneficial effect for Minnesotans and realize a fair financial return to the university, provided it doesn't interfere with the common good provision.

[And of course there is the court of public opinion, where once again the U has lost.]

No comments: