PepsiCo wins appeal against Indian attempt to remove potato patent

NEW DELHI, Jan 10 (Reuters) - An Indian court has effectively quashed a decision that removed PepsiCo Inc's (PEP.O) patent for the potato variety used to make its popular Lay's potato chips.

India's Protection of Plant Varieties and Farmers' Rights (PPVFR) Authority in 2021 revoked the intellectual protection for the U.S. snacks and drinks maker's FC5 potato variety, saying Indian rules did not allow seed varieties to be patented.

PepsiCo petitioned the Delhi High Court against the decision, but in July 2023 judge Navin Chawla dismissed its appeal. The company then appealed to the same court to reverse that decision.

In a judgement dated Jan. 9 and seen by Reuters, Delhi High Court judges Yashwant Varma and Dharmesh Sharma reversed the July 2023 ruling.

PepsiCo welcomed that decision.

"We remain dedicated and will continue to work along with the farming communities ensuring their benefit and overall progress," a PepsiCo India spokesperson said in an emailed statement.

PepsiCo, which set up its first potato chip plant in India in 1989, supplies the FC5 seed variety to a group of farmers who in turn sell their produce to the company at a fixed price.

In 2019, PepsiCo sued some Indian farmers for cultivating the FC5 potato variety, accusing growers of infringing its patent. The company sought more than 10 million rupees ($120,490) each for the alleged patent infringement.

Within months, PepsiCo withdrew the lawsuits against farmers.

PepsiCo has said it exclusively developed the FC5 variety and registered it in 2016. The FC5 variety has a lower moisture content required to make snacks such as potato chips.

PepsiCo is not the only U.S. company to have faced patent infringement issues in India. After a long-standing intellectual property dispute, seed maker Monsanto, now owned by German drugmaker Bayer AG, withdrew from some businesses in India.