BASF has resolved a lawsuit it brought against a number of rice farmers in northeastern Arkansas who violated the company’s CLEARFIELD* rice stewardship agreement and technology by planting saved seed or otherwise dealing improperly with CLEARFIELD rice seed. The Consent Judgment entered by the federal court awards BASF
damages of $2.5 million and enjoins certain conduct of the defendants in the future.

This resolution will help keep this innovative technology effective in coming seasons, according to Bruce Cranfill,
CLEARFIELD rice market manager.

“As a result of the judgment and its provisions, we are confident that none of the crop resulting from the use of the saved seed will enter the seed channel,” he said.

Concluding the lawsuit in this fashion is a clear victory for the vast majority of farmers who follow the stewardship agreement, Cranfill said.

“This legal action was necessary to preserve the integrity of the CLEARFIELD* Production System for rice for the overwhelming majority of farmers who have appropriately – and legally – used the technology,” he emphasized. “Our position has been explained to growers and is clearly spelled out in the stewardship agreement.”

CLEARFIELD rice is a unique production system with three elements: herbicide-tolerant seed varieties or hybrids; herbicides to manage previously uncontrolled weeds; and stewardship agreements.

Without proper stewardship, CLEARFIELD rice could potentially outcross with red rice, posing a significant long-term threat to growers of CLEARFIELD – now and in the future – who derive the benefits of this technology.

Last fall, BASF filed a complaint in U.S. District Court for the Eastern District of Arkansas claiming that several growers, who farm in and around Walnut Ridge, Arkansas, infringed patents on the technology and violated the stewardship agreement. BASF amended the complaint to name other growers and entities associated with the
original grower defendants. As part of the Consent Judgment, the growers who signed CLEARFIELD Stewardship Grower Agreements admitted they understood and agreed to terms of the agreement but violated it by planting saved seed. The Consent Judgment provides also that:

• BASF has been awarded damages against Defendants in the amount of $2.5M;
• Defendants acknowledge infringing the patent rights of BASF;
• Defendants must sell as grain all rice seed produced or retained contrary to the CLEARFIELD* rice stewardship agreements in order to ensure that the saved seed does not get into the seed
  channel;
• BASF will have the right to inspect the defendants’ premises over the next three years; and
• Defendants will implement key stewardship practices to maintain the continued viability of the CLEARFIELD technology.

The settlement of the case underscores the commitment by BASF to defend its CLEARFIELD technology, which ultimately will benefit the entire rice industry.

“The decision to take legal action in this matter was not made lightly, and it was made with conviction,” Cranfill said. “Our commitment to protecting the technology for the entire rice industry is unwavering.”

With sales of €3,354 million in 2004, BASF’s Agricultural Products division is a leader in crop protection and a strong partner to the farming industry providing well-established and innovative fungicides, insecticides and herbicides. Farmers use these products and services to improve yields and quality of agricultural crops. Other uses include public health, structural/urban pest control, turf and ornamental plants. BASF aims to turn knowledge rapidly into market success. The vision of BASF’s Agricultural Products division is to be the world’s leading
innovator, optimizing agricultural production, improving nutrition, and thus enhancing the quality of life for a growing world population.

BASF is the world’s leading chemical company: The Chemical Company. Its portfolio ranges from chemicals, plastics, performance products, agricultural products and fine chemicals to crude oil and natural gas. As a reliable partner to virtually all industries, BASF’s intelligent solutions and high-value products helps its customers to be
more successful. BASF develops new technologies and uses them to open up additional market opportunities. It combines economic success with environmental protection and social responsibility, thus contributing to a better future. In 2004, BASF had approximately 82,000 employees and posted sales of more than €37 billion. BASF
shares are traded on the stock exchanges in Frankfurt (BAS), London (BFA), New York (BF), Paris (BA) and Zurich (AN).

Always read and follow label directions.
CLEARFIELD is a registered trademark of BASF.