Billion-Dollar Strawberry Trial Tips Toward UC Davis

SAN FRANCISCO (CN) — A retired UC Davis researcher may have tipped the advantage to the university Tuesday on the last day of testimony in a federal jury trial over rights to use valuable strawberry cultivars in his private company and compete with the school for a share of California’s $2.5 billion strawberry industry.

Doug Shaw, an acclaimed strawberry breeder who developed more than a dozen varieties of the fruit for UC Davis’s strawberry breeding program before he retired to start California Berry Cultivars (CBC), acknowledged Tuesday that some of his company’s strawberry plants were bred in Spain from university-owned plants that had not been released commercially.

CBC imported seeds harvested from the plants into the United States.

Shaw tried to shift blame for the presence of university-owned genetic material in CBC’s plants to Eurosemillas, the company that conducted the breeding in Spain, and a co-founder of CBC. But UC Davis has claimed all along that Shaw bred strawberries from its plants for CBC without permission, and infringed nine of its strawberry patents by bringing the seeds into the United States.

According to UC Davis, Shaw and his research partner Kirk Larson bred or cross-bred the seeds in Spain because they knew they could not do so in the United States without violating U.S. patent laws.

“They must not have followed the plan I sent them,” Shaw testified about Eurosemillas on Tuesday. “I was completely surprised. We had no indication whatsoever they did not follow the plan.”

Before retiring, Shaw and Larson told UC Davis they wanted to form a private strawberry breeding company when they left the university, and proposed that the company license the strawberries they invented for the school, develop new varieties from them, and pay the school royalties.

UC Davis rejected the proposal and sought to protect its rights to 168 of the most valuable varieties Shaw and Larson developed by filing a mass patent application. It said it did so after Shaw threatened to release the plants publicly if it did not reconsider its rejection. The university sued the men and CBC in 2016 for conversion and patent infringement, among other grievances.

Shaw, Larson and CBC, as cross-complainants, claim the school acted in bad faith by seeking patent protection on 168 varieties in a single application, a move the U.S. Patent and Trademark Office called “inappropriate.”

California strawberries bring in $2.5 billion a year and are the state’s fifth most valuable crop. UC Davis’s agriculture school has developed 56 varieties since 1945, creating strains that are bigger, taste better, stay fresh longer and yield up to six times more per acre.

The varieties Shaw and Larson developed at UC Davis are grown throughout the world. They developed most of the strawberries eaten in California today. In 2004, they released the Albion variety, known for its sweetness and high yield. It can be grown nine months of the year and is the most widely planted strawberry in California today.

On Tuesday, the researchers’ attorneys asked Shaw to respond to last week’s testimony from plant genetics expert Stephen Dellaporta about a DNA analysis he performed that showed 85 percent of the plants CBC grew from imported seeds between 2014 and 2016 contain genetic material from UC Davis’s patented, unreleased varieties.

Dellaporta, a professor in Yale’s molecular, cellular and developmental biology department, said nearly every unreleased variety he identified in his analysis also appears on a list of university varieties Shaw emailed in 2014 to Javier Cano at Eurosemillas, telling him: “I may need selections from this list as parents next year.”

Shaw said on cross-examination: “If we had received a license we would have used these unreleased materials. I think what Dr. Dellaporta seemed to be saying was that the 2014 crossing plan I had sent to [Eurosemillas] for CBC had not been followed, and a large number of parents he identified in that crossing plan were unreleased University of California genetic materials.”

UC Davis attorney Rachel Krevans scoffed at the idea that Eurosemillas discarded Shaw’s cross-breeding plan, and said the DNA analysis and Shaw’s email to Cano suggested Shaw sent Eurosemillas a second, secret crossing plan, directing it to use the university’s unreleased plants.

“Either that or there was a major mix-up of materials,” Shaw replied, adding that he sent Eurosemillas only one plan. “I don’t have an explanation for this.”

Krevans was not persuaded. “Don’t let them fool you,” she told the jury during her closing argument.

“Shaw says, ‘I had no idea. I was surprised,’” she said. “You all have common sense. There are only two ways this could happen. Either he sent a different crossing plan to his close friend of many years, or, as he tried to suggest, Javier Cano and Eurosemillas decided they would do something completely different with unreleased strawberries. Which of those is more believable?”

During his closing argument, Shaw’s attorney Greg Lanier stopped short of blaming Eurosemillas, but insisted that Shaw had not intended to breed with the university’s unreleased strawberry varieties.

“Nothing but an inference would allow you to conclude there was any other plan,” Lanier said. “We are not disputing [Dellaporta’s] genetic analysis. What we are saying is we did not intend for that to happen. That’s the key. He did not intend this and there is no evidence he intended it or anyone else at CBC.”

The jury was to begin deliberating Wednesday.

Krevans is with Morrison & Foerster; Lanier with Jones Day, both in San Francisco.

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