In a major legal win for Canadian agribusiness innovation, Agriculture and Agri-Food Canada (AAFC) has successfully defended its intellectual property rights in the United States over the Staccato cherry, a late-ripening variety developed in Summerland, British Columbia. After years of litigation, a U.S. federal court has reinstated AAFC's U.S. patent, overturning its earlier decision that had invalidated it. This reversal is a powerful reminder to the agri-business sector that Canadian intellectual property can stand strong when you do your homework and adequately plan in advance to seek and maintain adequate legal protection when doing business abroad.
The story begins with a Canadian breakthrough: the Staccato cherry, discovered in 1982 by an AAFC breeder, is a variety that ripens later than most, extending the harvest season into early August. This trait gives growers a significant commercial advantage by allowing them to sell cherries when market supply is lower. Thus, to safeguard its innovation and maintain control over the commercial use of the variety, AAFC sought U.S. patent protection (U.S. Plant Patent No. 20,551), rather than relying solely on Canadian rights, as the U.S. represents a major export and cultivation market for cherries.
The legal saga, however, began when AAFC, the original breeder and rights holder, had licensed Staccato trees to a third party cherry grower in Washington State under a strict testing agreement that explicitly prohibited distribution. Even so, due to a mix-up, the third party grower inadvertently provided a Staccato tree to a U.S. farmer, who mistook it for a novel variety. The farmer propagated it and eventually rebranded it as 'Glory,' later securing U.S. Plant Patent No. 22,693. In response, Canada pursued infringement claims in the U.S. (Her Majesty the Queen in Right of Canada v. Van Well Nursery, Inc., 649 F. Supp. 3d 1055 (E.D. Wash. 2022)) to enforce its patent rights where the unauthorized commercialization occurred, aiming to uphold the integrity of its intellectual property and deter future breaches of its licensing agreements in a key agricultural market.
Although genetic testing confirmed that the Glory cherry was genetically identical to Staccato, a U.S. court had initially invalidated AAFC's patent, preventing the Canadian company's ability to enforce its intellectual property under U.S. law. Nevertheless, AAFC was able to demonstrate a misrepresentation of the evidence that had led the court to invalidate the Staccato patent. In short, a spreadsheet had appeared to show commercial sales of the variety before the patent filing date, but crucial data had been omitted that showed that the sales in question were actually of a different variety. The judge acknowledged the error, stating that the defendants had "falsely represented" the spreadsheet, reversed the court's earlier ruling and reinstated the Staccato patent.
The ruling affirms that Canadian-developed plant varieties can be protected under the U.S. legal system. This decision acts as a reminder of the existence of these often forgotten IP regimes for new plant varieties, which, as in this case, can be a powerful tool to protect one's competitive advantage in the marketplace.
- In Canada: To obtain protection under the Plant Breeders' Rights Act, a plant variety must be new, distinct, uniform, and stable (commonly referred to as the DUS criteria). The variety must not have been sold prior to certain time limits, must be clearly distinguishable from any other known variety, must be sufficiently uniform in its relevant characteristics, and must remain stable after repeated propagation.
- In the U.S.: Under the Plant Variety Protection Act (7 U.S.C. §§ 2321–2582), the Plant Variety Protection Office (PVPO) grants certificates for new varieties of sexually reproduced, tuber-propagated, and asexually reproduced plants. The criteria are similar to Canada's: the variety must be new, distinct, uniform, and stable. Protection grants the breeder exclusive rights to market and control of the use of the variety.
Innovators in the field of agriculture should not only consider securing plant patents or plant variety rights (PVRs), but what this decision highlights is the equally important need to make sure that testing and licensing agreements are robust and provide for adequate safeguards and restrictions on the use of one's intellectual property assets and measures of control to intervene quickly in the event of a breach. This case is a reminder to the agri-business field that commercializing innovations should be based on a multi-pronged approach that takes advantage of the formal protection of intellectual property through available legal regimes such as plant patents or plant variety rights (PVRs) and a thorough review and negotiations of commercial agreements with third parties.
Fasken's team of experienced attorneys in the field of agri-business located in any of our Canadian offices can help you elaborate an IP strategy that is tailored to your business endeavours and advise you in seeking patent protection, reviewing commercial agreements, or enforcing your rights, either in Canada or abroad.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
