The Minnesota Apple Growers for Fair Trade commenced a lawsuit against the University of Minnesota, Pepin Heights Orchard and a number of individuals involved in the development and recent release of the newest regional variety developed by the University of Minnesota’s Horticultural Research Center. The tree is called the Minneiska and it bears the fruit commonly referred to as SweeTango.®
Exclusivity of SweeTango®
While the variety was developed through the use of state and federal funding, the University of Minnesota sold the exclusive rights to produce, market and sell SweeTango® to Pepin Heights Orchard. The agreement was negotiated and signed before many of the Minnesota Apple Growers had knowledge of the variety, let alone the Exclusive License Agreement. It is believed that the Exclusive License Agreement runs contrary to state and federal law and the University’s policy as a Land Grant University.
The SweeTango® apple variety was developed through the use of public funds. The University of Minnesota is a Land Grant University created by the Hatch Act of 1887 establishing experimental stations at every land grant university. The Hatch Act is a federal statute that provides research and development funds for the benefit of the state’s citizens. Each experimental station receives federal funds every year to support ongoing research and development of plant technology. Pursuant to the Hatch Act, states also provide matching funds to support the experiment station.
Awarding the exclusive marketing rights to Pepin Heights Orchard runs contrary to the University of Minnesota’s own written principles that guide the management and distribution of University-developed technology including plants and plant related material.
The Exclusive License Agreement restricts fair trade of SweeTango.®
The agreement limits the Minnesota Apple Growers from growing more than 1000 trees and completely prohibits harvests with other Minnesota Apple Growers to sell for wholesale distribution. Further, Minnesota Apple Growers may only sell SweeTango® in the state of Minnesota. In other words, the agreement eliminates fair competition for a market share of SweeTango.® The effect of such restrictions creates unfair competition in the wholesale distribution of apples, both in the Minnesota marketplace and outside the state of Minnesota. Further, the inability to provide a complete line of regional varieties, including SweeTango® has already resulted in the loss of entire wholesale accounts for some of the Minnesota Apple Growers.
Goals of the Minnesota Apple Growers for Fair Trade
The Minnesota Apple Growers for Fair Trade are looking to level the playing field, preserve the mutually beneficial relationship with the University of Minnesota and its apple breeding program, and ensure that Minnesota consumers have access to the quality locally grown apple varieties at fair and competitive prices.
In that regard, our group has filed a lawsuit against the University of Minnesota, Pepin Heights Orchard and other individuals associated with the development of SweeTango® and the formation of the Exclusive License Agreement. The lawsuit seeks a judicial determination as to the Minnesota Apple Growers’ rights and status under the Exclusive License Agreement and Pepin Heights Orchard’s Non-Exclusive License Agreement for Minnesota Apple Growers. Specifically, we are seeking a declaration that both the Exclusive License Agreement between Pepin Heights Orchard and the University of Minnesota and the Non-Exclusive License Agreement issued by Pepin Heights Orchard to some of the Minnesota Apple Growers are void because the agreements violate public policy, violate state anti-trust laws and the Minnesota State Constitution, promote unfair competition, create consumer confusion, and violate federal law prohibiting unfair agricultural trade practices.
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