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PepsiCo India withdraws lawsuit against Gujarat potato farmers

The FC5 potato variety is grown exclusively for PepsiCo's popular Lay's potato chips.

The FC5 potato variety is grown exclusively for PepsiCo's popular Lay's potato chips. (Courtesy: Live Law.in)

May 3, 2019
PepsiCo Inc said on Thursday it will withdraw its lawsuits against a number of Indian potato farmers accused of infringing its patent.

After suing four farmers for cultivating the FC5 potato variety grown exclusively for PepsiCo's popular Lay's potato chips, the snack food and drinks maker said last week it wanted to "amicably settle" the issue.

Other than filing the lawsuit against the four farmers in April, PepsiCo had also sued five other potato growers.

PepsiCo India spokesman:

“After discussions with the government, the company has agreed to withdraw the cases against the farmers"

"The company remains deeply committed to the thousands of farmers we work with across the country and towards ensuring adoption of best farming practices.”
The decision comes after an influential Hindu nationalist group with close ties to Prime Minister Narendra Modi's ruling Bharatiya Janata Party accused PepsiCo of coercing the farmers.

PepsiCo maintains that it developed the FC5 variety, which has a lower moisture content required to make snacks such as potato chips, and registered the trait in 2016.

In April, the company filed the lawsuit in a court in Ahmedabad, the business hub of the western state of Gujarat, requesting the court to restrain the four farmers from growing the FC5 variety. The company had also sought more than Rs 1 crore ($142,840) each from the farmers.

The state government of Gujarat had assured the farmers that it would help them, Nitin Patel, deputy chief minister said last month.

The opposition Congress party had also criticised PepsiCo. PepsiCo, which set up its first potato chips plant in India in 1989, supplies the FC5 potato variety to a group of farmers who in turn sell their produce to the company at a fixed price.
Companies in this Article
PepsiCo is one of the world's leading food and beverage companies with over $65 billion in net revenue in 2012 and a global portfolio of brands, including several savory snack brands.
PepsiCo entered India in 1989 and in a short period, has grown into one of the largest food and beverage businesses in the country.
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