By Charles A Hice
Deere & Co is suing AGCO Corp over 12 John Deere patents it alleges are being infringed upon by Precision Planting and AGCO. Precision Planting started creating products for faster planting options in the market, and had been doing such a great job that it had caught the eye of many different companies in the past. There are many planting options for farmers out there though.
Deere & Co did attempt to purchase Precision Planting outright from an owning subsidiary of Monsanto, but this deal was struck down by the Department of Justice in 2016. The DOJ alleged, that the deal would have given Deere a monopoly on the high speed planting technology industry. Deere planting tech already accounts for more than 40% of the planting tech market, and Precision Planting accounts for another 40% of the market. A purchase the DOJ contested would have given Deere more than 80% market share of the entire industry world-wide.
This decision and the possibility of the Deere acquisition were a point of divide among farmers. With some claiming it would help lower their bottom line, and others thinking the opposite.
Late last year, Precision Planting was purchased from The Climate Corporation, a subsidiary of Monsanto, by AGCO. A complicated move, made even more complicated.
“The lawsuit states that product made or sold by Precision Planting, including vSet seed meters along with SpeedTube products, infringe on Deere patents,” the company says. “Deere states in the court filing that it has no licensed or otherwise authorized use of its patents by Precision Planting or AGCO.”
SpeedTube is the major product of concern, and a tech that Deere has been trying to acquire for some time now. There are of course, many types of planting tech and many considerations for optimization, but this tech has seemingly set the bar for the industry.
The biggest question is, why didn’t Deere commence a patent infringement case prior to trying to purchase Precision Planting in 2016? It has been claimed however, that Deere had brought up concerns with Precision Planting years ago, and had tried to purchase the company in order to forego suit in the past.
Deere even offered to license the same technology it tried to purchase to Ag Leader Technology in order to escape the denial of the deal from the DOJ in 2016. And again, no issue of infringement was brought forth until more than two years later, after Precision Planting found itself in the hands of AGCO.
“Deere is now suing AGCO over the Precision Planting technology that AGCO acquired that, in the first place, John Deere wanted to acquire,” said Dennis Buckmaster, a professor of agricultural and biological engineering at Purdue University in West Lafayette, Indiana. “There must be sufficient difference in the technology, or else Deere wouldn’t have wanted to acquire it in the first place.”
Deere alleges that the combination of AGCO tech and Precision Planting tech is what is infringing upon its patents. This will prove to be a complicated battle.
The lawsuit “is not related to previous activity regarding the proposed acquisition of Precision Planting by Deere,” said Ken Golden, a Deere spokesman. “The lawsuit is our effort to enforce Deere’s patent rights to protect the value of innovation created by our company and its employees and to restrict unauthorized use of the exclusive product features that are created through use of these patents.”
“Companies are “moving fast” with precision technology, transforming the industry”, said Karen Ubelhart, an analyst with Bloomberg Intelligence. “This is a big deal, and they’re all spending a lot of money on it.”
The farm tech sector is worth more than $250 billion dollars, and a lot of companies want to stake major claims and make major marks. The future of farming relies on farming technology that fully optimize all levels of the industry.
What has made Precision Planting’s technology such a game changer, seems to be the fact that its components can be retrofitted and attached to any older planters. As reported by Bloomberg news, the sales from this application alone are equal to all new unit sales for the entire industry.
It is no secret that AGCO and Deere are competitors, so there may not be much love lost between them. Deere has filed for damages, and it says damages will continue to be incurred until the case is settled. Currently, Deere is seeking a court order to temporarily block production from AGCO as well as collecting cash compensation.
Patent infringement cases are complex, and the decisions made here could affect the entire farming industry. With full autonomous tractors less than 5 years away, this technology is all the more important. Deere, CNH, and AGCO are the top 3 tractor companies in the world. Whereas, CNH seems to have its own direction on technologies it wishes to pursue, the battle between AGCO and Deere may just be getting started, as these companies continue to compete in the space race that is farming tech.
By Charles A Hice
Editor Ag Expo Magazine
contact@agexpomag.com
