Delhi HC rejects PepsiCo’s appeal over potato patent: What the case is

It pertains to FL 2027, a potato variety with high dry matter and low sugar content better suited for making chips. Normal table potatoes have more moisture, which adds to dehydration and energy costs during processing, and higher sugar, which causes blackening on frying.

FL 2027 was developed in 1996 by Robert W Hoopes, a US breeder employed with Frito-Lay Agricultural Research, a division of PepsiCo Inc. The latter has been manufacturing potato chips sold under its Lay’s brand using this processing-grade variety, which is grown by some 14,000 farmers in India via contract cultivation and buy-back at pre-fixed rates.

PepsiCo India Holdings, the subsidiary of the US food, snack and beverage giant, was granted a certificate of registration for FL 2027 as an “extant variety” on February 1, 2016. The validity period – during which nobody else could commercially produce, sell, market, distribute, import or export it without the breeder’s authorisation – was six years from the date of registration and extendable up to 15 years.

So, what changed after that?

PPVFRA, the authority that had earlier granted registration for FL 2027, revoked the same through an order passed on December 3, 2021. PPVFRA also issued a letter on February 11, 2022, rejecting PepsiCo India’s application for renewal of its registration. PepsiCo challenged both the order and the letter before the Delhi High Court. The court, in its ruling on July 5, upheld the PPVFRA’s decision. The single-judge bench of Justice Navin Chawla said it found “no ground for interference with the impugned order”.

Why was the registration revoked?

PepsiCo had, in its application on February 16, 2012, sought the registration of FL 2027 as a “new variety”. This, when the company had given the date of its commercialisation in India as December 17, 2009.

A “new variety” had to conform to the criterion of novelty. That required the propagated or harvested material from it not to have been sold in India earlier than one year before the date of filing the application for registration. Having failed the test of novelty, FL 2027 could only have been granted registration as an “extant variety”. Such a variety could satisfy only the criteria of distinctiveness, uniformity and stability, but not novelty.

PepsiCo was also found to have given the first date of sale of the variety in its application as December 17, 2009, when it had already been commercialised in 2002 in Chile. The certificate of registration had, thus, been obtained based on incorrect information furnished by the applicant.

Will this ruling impact investor confidence in India’s IP regime for protection of plant varieties and breeder’s rights?

Probably not. The HC has merely faulted PepsiCo for wrongly applying for registration of FL 2027 under the category of “new variety” and giving an incorrect date for its first commercialisation. Any protection granted for a plant variety is subject to the applicant making a complete disclosure of his claimed invention/development. This is similar to the requirements of the Patents Act, “which also grants a monopoly in exchange of a complete disclosure,” the court held.