Washington State University Countersues to Protect New Apple Variety
March 14, 2018 Washington State University announced Wednesday it has taken legal action in state and federal court against Phytelligence, an agricultural biotechnology company, for breach of contract and patent and trademark infringement. The litigation, which relates to the ‘Cosmic Crisp’ apple, was filed to protect WSU’s intellectual property rights.
WSU researchers began developing the ‘Cosmic Crisp’ brand apple in 1998 and applied for a plant patent for the tree that produces the ‘Cosmic Crisp’ in 2012. The distinctive new apple varietal has been planted in huge numbers in the state, and the expectations for ‘Cosmic Crisp’ are other-worldly. It is expected to be widely available on store shelves by early next year.
Phytelligence, an agricultural biotechnology company, has developed advanced micropropagation techniques to rapidly ramp up production of rootstocks to make them available to nurseries and growers directly.
According to the countersuits filed by WSU, Phytelligence had signed a research agreement with WSU to propagate the trees that produce ‘Cosmic Crisp’ apples, subject to strict limits. While the company was allowed to grow the trees, it was explicitly prohibited from selling those trees without a license. The propagation agreement specified that any trees grown by Phytelligence would remain the property of the university unless the company later obtained a license to sell them to third parties.
Phytelligence never secured a license. However, in 2016, the company sold 135,000 ‘Cosmic Crisp’ trees to an outside grower.
“It takes a long time to prepare a new apple variety for market. WSU has been developing the ‘Cosmic Crisp’ apple for the past 20 years,” said Chris Keane, WSU Vice President for Research.
“We have no choice but to vigorously defend our intellectual property rights against this serious breach of contract and infringement of our patent. Phytelligence’s actions threaten nearly two decades of work and the financial support provided by apple growers in the state of Washington. We owe it to all those companies that have followed the rules. We have to protect the significant investment the university and Washington growers have made to bring this new product to market,” Keane said.
Nearly 5 million ‘Cosmic Crisp’ trees are expected to be planted in 2018. The ‘Cosmic Crisp’ apple is highly valued by growers and retailers for its large, juicy fruit, exceptional flavor, and slowness to brown after being cut. Equally important, the new varietal can be stored for more than a year and still maintain its distinctive texture and flavor.
WSU’s countersuits are in response to legal action Phytelligence brought against the university earlier this year. WSU has filed its breach of contract countersuit in King County, Washington Superior Court and its patent infringement claim in the United States District Court for the Western District of Washington.
Phytelligence CEO Ken Hunt issued the following statement regarding the suit and countersuit: “In late February, we filed a lawsuit against Washington State University (WSU) to protect Phytelligence’s right to propagate ‘Cosmic Crisp’ apples and increase availability for Washington state growers.
“In 2012, we were granted an option for a license from WSU or its agent to commercially propagate ‘Cosmic Crisp.’ We have exercised that option; however, WSU and its agents have not yet provided the license to Phytelligence. Our efforts have been met with repeated delays and misinformation, ultimately preventing us from propagating ‘Cosmic Crisp to date.’ During this time, Washington state growers have been increasingly frustrated with unnecessarily restricted access to ‘Cosmic Crisp.’
“We recognize and value WSU’s broad and continuing support of Phytelligence; our concerns in this matter stem from the actions of a few individuals within the university. As such, concurrent to this legal filing, we are continuing to work directly with WSU to identify a mutually beneficial resolution.
“Given our long-standing relationship with WSU and our shared interests, we are optimistic this issue can be resolved to everyone’s benefit.”
Phytelligence has made plenty of news in the past year. For example, it signed a propagation agreement with the Midwest Apple Improvement Association to expand the availability of the association’s flagship variety, ‘EverCrisp.’
In July, it announced it has secured the first $6.95 million of a total potential $16 million second funding round, known in venture capital as Series B.
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