By Johnathan Hettinger Midwest Center for Investigative Reporting
A retired BASF executive told a federal jury on Tuesday that the company never intended to enter into a “joint venture” with Monsanto over the dicamba-tolerant crop system that was released beginning in 2015.
“We didn’t want to be exposed to Monsanto’s losses,” said Alyson Emanuel, who, in her role then as vice president of global strategic marketing for herbicides, helped negotiate contracts between BASF and Monsanto that governed the relationship.
In an effort to combat growing weed resistance, Monsanto genetically engineered soybean and cotton seeds that could withstand being sprayed by dicamba, a volatile herbicide that has been used since the 1960s. The two companies also developed new versions of the pesticide designed to be less volatile.
BASF and Bayer, which acquired Monsanto in 2018, are being sued by Bader Farms, the largest peach grower in Missouri, over the dicamba-tolerant crop system, which has allegedly damaged millions of acres of crops since its release.
Bader Farms alleges that the companies engaged in a “joint venture” to release the products, knowing dicamba could move off-target and harm crops like its peach orchard, in order to increase the demand for their companion products. The companies dispute the claims and instead blame the damaged peach trees on other causes, such as soil fungus.
BASF’s defense focused on establishing distance between itself and Monsanto.
“We are fierce competitors,” said Scott Kay, BASF's vice president of U.S. Crop Protection, in video testimony Tuesday.
Kay testified he didn’t know anything about a conspiracy with Monsanto, adding that BASF’s dicamba-based herbicide Engenia is a direct competitor to Monsanto’s Xtendimax with VaporGrip.
Tracey George, an attorney for Bader Farms, pointed out that top BASF and Monsanto officials met at least 19 times to discuss the rollout of the dicamba-tolerant system, including to discuss how to test dicamba products for regulators. George also pointed out that BASF gets money for every acre of dicamba-tolerant seeds planted.
‘Ticking time bomb finally exploded’
Monsanto released genetically engineered cotton and soybean seeds in 2015 and 2016, respectively. But neither Monsanto nor BASF released lower volatility versions of dicamba that could be sprayed on the crops until 2017.
Throughout the trial, the companies have claimed that they discouraged use of older versions of dicamba, manufactured and sold by BASF, on these crops because it would be an illegal application. Monsanto put a pink sticker saying dicamba can’t be used on the crops on every bag of seed. BASF told all of its employees and sales staff that they could not advise farmers to spray older versions of dicamba.
But in the summer of 2016, BASF sales representatives in the field were raising concerns about older versions of dicamba causing damage in the field, according to documents presented in court Tuesday.
“The one thing most acres of beans have in common is dicamba damage. There must be a huge cloud of dicamba blanketing the Missouri Bootheel. That ticking time bomb finally exploded,” an innovation specialist wrote in a July 4, 2016, report.
“ALL of the DT cotton that is planted this year has sprayed OFF LABEL and growers are being very mum about their applications,” one wrote, according to comments from sales managers compiled by Duane Rathmann, a technical service representative at BASF, and presented in court.
One sales manager said his numbers increased from 6,500 gallons to 12,800 gallons.
Another wrote that he was in a field and saw a pig weed — a type of weed that is generally resistant to glyphosate — dying and the farmer said, “I can’t tell you what I sprayed,” and they moved on to another subject.
BASF, Monsanto’s ‘contentious’ contract
In 2008, Monsanto and BASF entered into a settlement agreement in a lawsuit that gave Monsanto full ownership rights to seeds genetically engineered to withstand being sprayed by the weedkiller dicamba. In exchange, BASF would get a payment every time the trait was developed in the future.
In response to that settlement, the two companies decided to enter into a business relationship, governed by a number of contracts over the next decade. In those contracts, Monsanto was responsible for developing dicamba-tolerant seeds and BASF was responsible for developing a low-volatility form of dicamba.
Previous versions of dicamba, which began being sold in the 1960s, were not widely used because of their propensity to move beyond the area they were sprayed. Eventually, Monsanto also developed a low-volatility form of dicamba, which was released commercially at the same time as BASF’s.
“It took a long time, it was very contentious,” Emanuel said. “We were very specific about what we wanted in the contract.”
Emanuel said they were careful to avoid shared profits and losses and shared decision-making. She also testified that BASF had no role in commercializing Monsanto’s dicamba-tolerant Xtend cotton and soybean seeds.
But the companies were in consistent communication, George pointed out. Their agreement led to the development of three working groups, focused on developing products, obtaining registration for those products from the federal government and commercializing those products.
For example, in 2012, BASF executive management directed its sales team to encourage farmers to submit public comments to the U.S. Department of Agriculture to speak to the need for a dicamba-tolerant crop system and the value it would provide because “we have a vested interest in their success,” according to documents presented in court.
Also, in 2015, Monsanto asked BASF to limit testing on Engenia because of U.S. Environmental Protection Agency concerns about dicamba’s drift and volatility, documents showed.
In 2017, the companies’ executives also met to discuss a joint defense strategy. At that meeting, Monsanto agreed to stop blaming drift damage on glufosinate, the weedkiller in the LibertyLink soybean system, which BASF was acquiring from Bayer, according to documents.
BASF is expected to rest its case Wednesday, with closing arguments likely to begin on Thursday morning.