US food and beverage giant PepsiCo Inc has reportedly agreed to withdraw lawsuits against four Indian potato farmers in the Indian state of Gujarat it accused of illegally growing the company's patented potatoes.
PepsiCo had wanted the farmers to either give an undertaking and not use a strand of potato - the FC5 - it had registered for exclusive use or, instead, purchase seeds from the company and sell the produce to them.
The Alliance for Sustainable and Holistic Agriculture (ASHA) cautiously welcomed the move.
"Farmers rights activists termed this as a major victory for all farmers of India provided it is unconditional," it said in a statement.
PepsiCo, which entered the Indian market in 1989 and established a research and development facility, had been demanding nearly $200,000 (AUD) for each alleged patent infringement.
Source: SAM PANTHAKY/AFP/Getty Images
In a statement to SBS Hindi, it claimed it was compelled to take 'judicial recourse to safeguard the larger interests of thousands of farmers engaged with its collaborative potato farming program."
However earlier this week offered to settle with the farmers, after finding itself under increasing pressure from farmers' rights groups and unions who demanded political action.
Why the FC5 variety is important
The bone of contention is the FC5 potato which is used to make Lay’s chips, a popular product by PepsiCo. This variety of potatoes has lower moisture content and the company claims rights over the trademark FC5.
Farmers, however, claim they have been growing the potato for a long time and they have a legal right to use their produce.
Calls for compensation
ASHA says it believes PepsiCo India's withdrawal of the lawsuit is an acceptance of farmers rights.
"PepsiCo should have apologised for the intimidation and harassment of farmers in this case, and it should have been penalised for adopting these tactics against farmers. PepsiCo should also pay compensation to the sued farmers,” it said.
"We also believe that the government should put into place clear mechanisms to avoid a repetition of this episode in future."
