Business

Iowa farm sues bull sperm seller in Texas, alleging monopoly, threats

A Benton County dairy farm says a Texas-based company that sells sex-sorted bull semen has hampered its ability to grow its own genetics business.

GenoSource, which owns an 8,000-cattle herd in Blairstown, last week filed a complaint against Inguran LLC, which does business as Sexing Technologies, in the U.S. District Court for the Northern District of Iowa.

Sexing Technologies processes raw bull ejaculate into sex-sorted semen, which it sells to farmers in plastic straws for artificial insemination, letting them control calf gender with high accuracy.

The filing is the latest in a legal skirmish between GenoSource and Sexing Technologies dating back to October, when in an initial complaint the farm accused the company of refusing to relinquish 40 Holstein bulls, cows and heifers after the parties failed to negotiate a long-term written agreement.

GenoSource says Sexing Technologies slaughtered some animals and sold semen and embryos from others without its consent, wrongfully asserting rights to those genetic materials through September 2023 in the process.

Under a previous non-contractual agreement, Sexing Technologies used some GenoSource cows as embryo surrogates and paid the farm to house those cows and their eventual calves. Sexing Technologies also extracted, sorted and sold semen from some GenoSource bulls — some of which the farm bought to help grow its herd — with profit split between the parties.

GenoSource’s May 23 complaint lists 10 counts of alleged wrongdoing by Sexing Technologies and asks a judge for permanent injunctive relief prohibiting the company from selling or disposing of animals or genetic materials. The farm also is seeking damages, including to account for lost potential sales and unfair competition, plus legal fees.

The specific amount of damages sought was not specified.

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GenoSource’s attorneys wrote in the new complaint that Sexing Technologies wrongfully asserted claims to the farm’s animals under a joint-venture agreement multiple investors and cattle breeders signed in 2013, including some representatives who would go on to establish GenoSource the following year.

Though GenoSource never became party to that agreement, Sexing Technologies attorneys argued in a March filing the farm benefited from its “ratification, course of performance and acceptance of contractual benefits.”

Sexing Technologies’ attempts to bind GenoSource to the joint-venture agreement and refusal to surrender its 40 animals constitute “another step” in the company’s efforts to maintain a monopoly in the sex-sorted semen market, the farm’s attorneys said in the new complaint.

The company’s marketing and sales of genetic materials from GenoSource animals caused “significant” confusion among semen customers as to the origin of the products, and stripped the farm of control over its genetic line, its attorneys continued.

Sexing Technologies representatives also have used the threat of litigation to keep other sex-sorting service providers from forging business relationships with GenoSource, the farm’s attorneys said.

One semen purchaser refused to close a 7,500-straw sale it had negotiated with GenoSource after an alleged threatening call from a Sexing Technologies employee, according to the complaint. GenoSource animals also were pulled from an auction after the coordinator received a similar call from a company executive, the complaint says.

Attorneys for GenoSource and Sexing Technologies did not return requests for comment.

• Comments: (319) 398-8366; thomas.friestad@thegazette.com

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