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n. LACK OF ADEQUATE PATENT PROTECTION PUTS U.S. B REEDER S 

 AND FRESH CUT FLOWER GROWERS AT A COMPETITIVE 

 DISADVANTAGE 



Among the types of plants subject to plant variety patents are flowering plants. 

 For example, rose plants are leased or rented from companies that hold patents. Patents are 

 enforced in the United States by frequent on-site inspections to determine whether new 

 plants are being propagated from the leased plants without payment of royalties. Yet, 

 without the ability to enforce royalty agreements abroad, fresh cut flower growers in 

 foreign countries are believed to pay no royalties for mother plants by illegally making 

 cuttings. In contrast, U.S. flower growers face high royalties for patented flowers. U.S. 

 growers' royalty payments can be as high as $10 of a $10.50 plant, depending on the type of 

 plant. More typically, the royalty on a rose plant is likely to be between $.30 to $.80 per 

 $3.00 plant. SffiE J. Pertwee, Production and Marketing of Roses at 20 (1992) (According 

 to other industry sources, the royalty on a rose plant ranges from $.65 to as much as $1.25 

 per $3.00 plant). 



U.S. patents on plants can also be easily violated when imported merchandise is 

 not marked with correct country of origin information. U.S. law requires that merchandise 

 imported into the United States be marked with country of origin information. 19 U.S.C. § 

 1304. Under § 1304(aX3XJ). fresh cut flowers, however, have been excepted from this 

 requirement under Customs' "J-List" of articles since 1939. 19 C.R.F. § 134.33. Only the 

 immediate container in which the imported flower ordinarily reaches the ultimate purchaser 

 must be marked with country of origin information. 19 U.S.C. § 1304(b). 



In practice, if im po r ted merchandise is marked at all, only the box or other 

 container of flowers will be marked. Flowers are taken out of these containers either by 

 wholesalers or retailers (including grocery stores) before resale to consumers. In addition 

 to not being marked with country of origin information, the information which is provided 

 is often misleading re.g. f providing location of corporate headquarters or location of 

 importer as country of origin). Customs Information Bulletin No. 90-91 (11/28/90). 

 Indeed, Customs has noted, through examination of fresh cut flower imports, that "some 

 containers show a U.S. address and bear no country of origin marking." Id. at 2. Hence, 

 neither Customs nor die holder of the patent can determine whether imported flowers have 

 been produced or sold without payment of royalties. 



