Bloomberg BNA’s Patent Trademark & Copyright Law Daily™is the IP industry’s premier news service, offering objective, timely,and reliable daily news coverage and commentary from leading IP law...
By Anandashankar Mazumdar
Nov. 27 — A farmer didn't intend to violate an obscure federal law by selling wheat seed, so his insurance company can't dismiss his pursuit of coverage, the U.S. District Court for the District of Kansas has ruled.
Farmer Brett Parker of Waterville, Kan., didn't know about the federal Plant Variety Protection Act (PVPA) of 1970—nor about another party's exclusive right to sell the wheat seed, the court said Nov. 16. Only if Parker knew, could he have expected some harm or damage to follow from his decision to advertise and sell the seed.
“If you have never heard of the Plant Variety Protection Act (PVPA), you are not alone,” the court stated at the beginning of its order rejecting Parker's insurer's motion. It ruled that the insurance company could not get the farmer's action for coverage of his legal expenses dismissed under an “intentional act” exclusion clause.
Parker is an owner of D&B Parker Farms LLC. In September 2013, he sold some Fuller variety wheat seed to what turned out to be an undercover agent.
The agent was working for the Kansas Wheat Alliance, which held the exclusive right to sell that variety of seed pursuant to the PVPA, 7 U.S.C. §§2321-2582, a statute that creates a 25-year exclusive sui generis right to breeders of new plant varieties.
The wheat alliance then sued Parker, alleging a violation of the PVPA. Parker had a general business insurance policy with the Farm Bureau Property and Casualty Insurance Co. of West Des Moines, Iowa, and he sought coverage of his legal expenses and any liability he might face.
The Farm Bureau declined coverage under a clause of the policy that stated it would not cover loss or damages arising from an intentional act that would expected to cause harm to someone.
Parker had intentionally advertised and sold the wheat seed, the insurance company said, so his losses were not covered.
Parker ended up settling with the alliance, paying his own legal costs.
Then, Parker sued the insurance for defense and indemnification under the policy. The insurance company moved for dismissal pursuant to Fed. R. Civ. P. 12(b)(6) for failure to state a claim for which the law offers a remedy.
Parker v. Farm Bureau Prop. & Cas. Ins. Co.
July 2, 2015
“Parker had no idea of the existence of the PVPA or the protections that it grants to owners of varieties of seed wheat,” according to Parker's complaint against the insurance company.
The farmer's lack of knowledge of the PVPA and its implications meant that his act of violating the wheat alliance's PVPA rights was not intentional.
“Parker did these acts without knowledge of an obscure federal law and without knowledge of an exclusive federal license pertaining to a particular variety of wheat,” the court said. “Farm Bureau cites nothing to show that a reasonable person would have expected advertising and selling wheat seed to result in injury or damage. Only with knowledge of the exclusive license would a person expect a sale to result in damage.”
Thus, the court said, Parker had made a valid claim of breach of contract and it denied the insurance company's motion to dismiss.
The court's ruling was issued by Judge J. Thomas Marten.
Parker was represented by Martin, Pringle, Oliver, Wallace & Bauer LLP, Kansas City, Mo. Farm Bureau was represented by Thompson Ramsdell Qualseth & Warner P.A., Lawrence, Kan.
To contact the reporter on this story: Anandashankar Mazumdar in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Mike Wilczek in Washington at email@example.com
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)