Patents allow businesses to thrive and dominate a niche by being the only registered producers of a given product. When a product is patented, it would be illegal for another company or group to use that product for business purposes until the patent expires. This is what PepsiCo did for a variety of potato it uses for Lays chips. However, the company discovered that four farmers in India are growing this same variety of potato without its permission and decided to take them to court.
The Indian subsidiary of PepsiCo initially requested that the farmers pay 10 million rupees for violating their patent. Now, in a recent press release, the company offered to settle with the farmers if certain conditions are met. According to CNN, Pepsi will drop the lawsuit against the farmers if they agree to join its collaborative potato farming project. This would mean that the farmers purchase the seeds from the company, grow it, and sell the final product to the company. The farmers are currently considering the offer and would make a final decision during the next hearing on June 12.
While the farmers have been running their operation for years, this is the first time another company is suing them for growing its registered variety of potatoes according to one of the farmers. The case caused a lot of outrage on social media and the Indian government was asked to intervene on behalf of the farmers.
Currently, PepsiCo is the biggest buyer of processed grade potatoes in India. Its collaborative farming operation includes thousands of farmers in India. PepsiCo reported that it had no other choice but to take judicial action against the farmers in a bid to protect the interest of all the farmers involved in the program which it plans to expand to more regions in the next few years.