What Happens When Public Universities Are Run by Robber Barons
What Happens When Public Universities Are Run by Robber Barons
And the subject is soybeans, presumably including strains developed by UC Berkeley’s Chris Somerville, who made millions selling genetically modified soy to Monsanto.
Somerville currently serves as head of the campus side of the Energy Biosciences Institute [EBI], funded with $500 million of BP money to develop GMO crops and microbes BP can use to produce transportation fuels.
The Brazilian case centers on one of Monsanto’s most insidious practices: Turning farmers into corporate serfs by banning the the practice at the heart of agriculture since its beginngings — saving seeds to plant next year’s crop — and imposing royalties on farmers whose crops by be contaminated by their own GMOs.
The story from Subodh Varma of the Times of India:
Five million Brazilian farmers have taken on US based biotech company Monsanto through a lawsuit demanding return of about 6.2 billion euros taken as royalties from them. The farmers are claiming that the powerful company has unfairly extracted these royalties from poor farmers because they were using seeds produced from crops grown from Monsanto’s genetically engineered seeds, reports Merco Press.
In April this year, a judge in the southern Brazilian state of Rio Grande do Sul, ruled in favor of the farmers and ordered Monsanto to return royalties paid since 2004 or a minimum of $2 billion. The ruling said that the business practices of seed multinational Monsanto violate the rules of the Brazilian Cultivars Act (No. 9.456/97).
Monsanto has appealed against the order and a federal court ruling on the case is now expected by 2014.
A telling quote defines the essence of the farmer lawsuit:
“Monsanto gets paid when it sell the seeds. The law gives producers the right to multiply the seeds they buy and nowhere in the world is there a requirement to pay (again). Producers are in effect paying a private tax on production,” Jane Berwanger, lawyer for the farmers told the media agencies.
Here’s a video report from RT
Featuring am interview with Shelly Roche of ByteStyle.TV:
Luisa Massarani, writing for Nature, describes the potential impacts:
Brazil is the second-largest producer of genetically-modified (GM) crops, after the United States. Last year, it farmed 30.3 million hectares of the crops, mostly soya beans, but also corn and cotton. It legalized the growing of GM crops in 2005, after it became clear that about three-quarters of the soya crops produced in the southern state of Rio Grande do Sul were already being grown from Roundup Ready seeds that had been smuggled in from Argentina. Because the crop is resistant to the herbicide glyphosate, marketed as Roundup, farmers can spray they fields with the chemical to control weeds without risking damage to their crops.
Since the legalization, Monsanto has charged Brazilian farmers 2% of their sales of Roundup Ready soya beans, which now account for an estimated 85% of the nation’s soya-bean crop. The company also tests Brazilian soya beans that are sold as non-GM — if they turn out to be Roundup Ready, the company charges the farmers responsible for the crops some 3% of their sales.
On 12 June, the judges of the Brazilian Supreme Court of Justice ruled against Monsanto, deciding unanimously that the ruling by the Justice Tribune of Rio Grande do Sul, once it is made, should apply nationwide. Monsanto has declined to comment on the case.
Some scientists fear that if the company is forced to repay royalties, it could trigger cuts in funding for biotech research.
If they prevail in the end, the farmers could have a major impact on Somerville’s BP project, which aims at creating massive industrial-scale plantations in Latin America, Africa, and Asia for proprietary agrofuel crops.
When two scientists from the Woods Hole Oceanographic Institute [WHOI] learned of the Deepwater Horizon disaster in the Gulf of Mexico, the promptly volunteered their expertise to assess the extent of the massive underwater oil spill.
Little did they know that two years later they’d find themselves in court, on the losing end of a motion filed by oil giant BP that would force them to reveal both the raw and spirited contention that goes into scientific research but the secrets of their own inventions as well.
And the net result could prove chilling to both the scientific deliberative process and to the willingness of scientists to give themselves freely when their help is needed.
The events that have shocked the scientific community should also serve as a reminder to UC Berkeley scientists that their emails could well be targets of the company that effectively bought the university with the largest corporate research grant in the history of American academia.
Dampening the volunteer spirit
We being with a summary of the what happened, from Suzanne Goldenberg of The Guardian:
A pair of scientists have accused BP of an attack on academic freedom after the oil company successfully subpoenaed thousands of confidential emails related to research on the Gulf of Mexico oil disaster.
The accusation from oceanographers Richard Camilli and Christopher Reddy offered a rare glimpse into the behind-the-scenes legal manoeuvring by BP in the billion-dollar legal proceedings arising from the April 2010 blow-out of its well.
It also heightened fears among scientists of an assault on academic freedoms, following the legal campaign against a number of prominent climate scientists.
The two researchers turned over some 50,000 pages of research notes and data to BP. But BP demanded more, and obtained a court subpoena for the handover of more than 3,000 confidential emails.
Now for some background
Christopher M. Reddy and Richard Camilli are scientists at Woods Hole. A marine chemist, Reddy directs the Director of the Institution’s Coastal Ocean Institute, while Camilli is an associate scientist with a specialty in oceanic physics and engineering.
After the Deepwater Horizon explosion on 20 April 2010, the two volunteered their time, expertise, and equipment to survey the extent of the oil spill, but found themselves block by BP.
Here’s Camilli’s testimony to the National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling on 27 September 2010:
And here’s what they discovered when they were finally allowed in, via a 19 August, 2010 report from WHOI:
Scientists at the Woods Hole Oceanographic Institution (WHOI) have detected a plume of hydrocarbons that is at least 22 miles long and more than 3,000 feet below the surface of the Gulf of Mexico, a residue of the BP Deepwater Horizon oil spill. In the study, which appears in the Aug. 19 issue of the journal Science, the researchers measured distinguishing petroleum hydrocarbons in the plume and, using them as an investigative tool, determined that the source of the plume could not have been natural oil seeps but had to have come from the blown out well.
Moreover, they reported that deep-sea microbes were degrading the plume relatively slowly, and that it was possible that the 1.2-mile-wide, 650-foot-high plume had and will persist for some time.
The WHOI team based its findings on some 57,000 discrete chemical analyses measured in real time during a June 19-28 scientific cruise aboard the R/V Endeavor, which is owned by the National Science Foundation (NSF) and operated by the University of Rhode Island. They accomplished their feat using two highly advanced technologies: the autonomous underwater vehicle (AUV) Sentry and a type of underwater mass spectrometer known as TETHYS (Tethered Yearlong Spectrometer).
And the lawyers play games
Having spent nearly five years covering litigation in Southern California’s most elite court venue, we can pretty much parse the reasons why BP wanted the emails.
The answers to be found in a two-word phrase: Exculpatory evidence.
Science can be a rather messy affair before it gets to the stage of the well-crafted journal article or heavily footnoted report as scientists “blue sky” a whole range of hypothesis, not a few of which are simply off the wall. There’s good reasons for doing it that way, throwing out all manner of ideas and concepts while honing down the focus to the set that best fits the data.
But to a lawyer defending one of the world’s biggest corporations against massive civil suits, getting hold of those spontaneous communications can prove a wonderful thing in court, allowing a crafty litigator to create alternative scenarios aimed solely at discrediting an adverse witness.
And the reality of modern communications technology is that its residues last forever, providing a potential gold mine for advocates consumed by the notion of dazzling or bamboozling a jury.
And so, being the zealous advocates they are, BP’s lawyers struck for the jugular, and when the dust had settled, they got everything — including sensitive proprietary information about costly hardware they scientists had invented.
Before the age of emails, scientists would debate their evidence through old media, from phone calls to letters, and much of those exchanges would simply vanish, either forgotten or relegated to the wastebacket.
The scientists were alarmed, writing to the Boston Globe:
Ultimately this is not about BP. Our experience highlights that virtually all of scientists’ deliberative communications, including e-mails and attached documents, can be subject to legal proceedings without limitation. Incomplete thoughts and half-finished documents attached to e-mails can be taken out of context and impugned by people who have a motive for discrediting the findings In addition to obscuring true scientific findings, this situation casts a chill over the Continue reading
We suggested last week that California is the next Greece, and now someone with more academic luster posits much the same:
The program notes:
The state of California has been in a downward spiral when it comes to it’s financial situation. Governor Jerry Brown is now proposing implementing austerity measures to pull the Golden State out of the red. Social programs such as welfare and healthcare for the poor are the first to be slashed and Dr. Caroline Heldman, politics professor at Occidental College, joins us with her take on the situation.
Is California the next Greece?
It’s a legitimate question given the attacks on the California commons that began with Proposition 13 and continue with the ongoing ravaging of the institutions built up over the generations.
Starved of cash by a powerful set of interests organized by the California Chamber of Commerce, the California Taxpayers Association, and other industry-backed lobbies, the state is looking very Grecian these days.
Jerry Brown, the Swidden governor
Back in the days we were studying anthropology in the Groves of Academe, slash and burn was the name given to the practice of primitive forest agriculture where farmers burned the existing vegetation, then planted their crops in the ash-enriched soil. Once the soil is depleted, the farmers move on to slash and burn again.
Today the practice is called Swidden,
But unlike the practitioners of old, California’s slash-and-burn governor will have no new forests to burn once this one’s consumed.
From Guy Adams of The Independent:
Taking a deep breath, California’s most powerful man strode to a lectern and unveiled the fiscal policy that he hopes will keep America’s most populous state from falling into bankruptcy.
“You name it,” he declared, “and we’ve got to cut it!”
It wasn’t the most nuanced announcement. But this is no time for subtlety. After years watching his state fall deeper and deeper into the red, Governor Jerry Brown used a gloomy Monday night press conference to unveil what aides described as the ultimate in austerity budgets.
Welfare payments, healthcare for the poor, and benefits for elderly and disabled Californians will be immediately slashed by around $8.3bn (£5.2bn), which equates to roughly 17 per cent of Mr Brown’s entire discretionary budget. And state offices, which employ roughly 200,000 people, will switch to a four-day, 38-hour work week.
The radical proposals came days after it emerged that the Golden State, which is currently suffering 11 per cent unemployment, has a projected annual deficit of $16bn, far higher than the $9bn predicted in January. Its total debt is now around $40bn, giving it the lowest credit rating of any US state in recent history and prompting fears of a Greek-style default crisis.
As with most government cuts under the austerian regime, the poor and the young will be those most hurt.
More details from Steven Harmon, Josh Richman, Sharon Noguchi, and Karen de Sá of the Oakland Tribune:
In his revised budget, Brown also proposed cuts to hospitals and nursing homes to reduce Medi-Cal costs; barring colleges and universities that can’t meet minimum performance standards from taking part in the Cal Grant program; reducing state workers’ pay by 5 percent through contract renegotiations; and using assets that used to belong to local redevelopment agencies.
K-12 schools and community colleges would be hit hardest if the tax proposal fails at the ballot, a $5.5 billion plunge that would drop their funding to $48.2 billion. In the current fiscal year, schools, which get about 40 percent of the state’s general-fund revenues, received $47 billion.
And the downgrade warning follows
Note the perversity of the modern financial game: If you don’t impose austerity, you get downgraded. In other words, you’re only rewarded for inflicting misery. And unlike S&M games, there’s no “safe” word to temper the violence of the market.
One bond rating agency was quick to respond to Brown’s apocryphal pronouncement, reports Chris Megerian of the Los Angeles Times:
The ratings agency Standard & Poor’s warned on Tuesday that it could downgrade California’s financial outlook if lawmakers don’t pass a credible budget plan this year.
A final budget is due June 15, and lawmakers’ task has become increasingly difficult as the state’s deficit has swelled to nearly $16 billion.
“We could change the outlook to negative or lower the rating if we believe the state’s credit quality weakens through the budget process,” said a report from Standard & Poor’s.
The ratings agency had upgraded California’s financial outlook from “stable” to “positive” in February. That means California’s credit rating of A-, the lowest of any state, is poised for improvement.
Gov. Jerry Brown’s budget proposal is a solid starting point, said Standard & Poor’s, but there are many political and policy hurdles left to go.
Hitting hard at California’s college students
Naheed Rajwani of UCLA’s Daily Bruin reports on the impacts of Brown’s proposal of concern to students in the state’s higher education system:
Under the revised budget proposal, both the University of California and the California State University systems would each need to absorb $250 million, which is $50 million more than what was proposed earlier this year.
These cuts will not materialize if Brown’s proposed tax measure passes in November. The measure would raise the sales tax by a quarter percent and increase income taxes on the wealthy, raising an estimated $8.5 billion in extra revenue for the state.
In his proposal, Brown also revised the amount of money that can be allocated to the UC Retirement Plan, from $90 million to $52 million. That number will not be affected by the passage of the tax measure.
The California Legislature will now review the proposal and is expected to pass a final budget in mid-June.
Canadian students would be up in arms
That’s because yet another tuition hike is certain, following on a wave of increases that have sent the costs of attending UC campuses soaring to levels that ensure many enrollees will be forced to take out those odious student loans to cover the costs.
As the San Francisco Chronicle’s Nanette Asimov reported a week ago:
The University of California will need to charge students at least 6 percent more for tuition next fall – an extra $732 – to stave off more layoffs and program closures, say UC leaders who will ask the regents next week to consider raising the price in July.
“At minimum we’ll need 6 percent,” said UC’s budget czar, Patrick Lenz, noting that an increase of that size would take care of most of the $139 million shortfall expected for next year.
The problem, Lenz said, is that all of those numbers could get worse.
When the Regents met in Sacramento to discuss the tuition hike yesterday the discussion was derailed, at least for a time, when students rose to protest.
Here’s a clip of their action va the UCLA Daily Bruin:
Pat Flynn of San Diego’s U-T [formerly the Union-Tribune] reports on the outcome of the delayed discussion:
The UC regents will consider boosting tuition again, by 6 percent, at a meeting in July. If approved, it would raise the cost to $12,923 a year, nearly double what it was five years ago. That does not include the Continue reading
A very important alarm from the combined membership organization of the faulty of the University of California:
The Council of University of California Faculty Associations is a coordinating and service agency for the several individual Faculty Associations — associations of UC Senate faculty — on the separate campuses of the University of California, and it represents them to all state- or university-wide agencies on issues of common concern.
From the Council:
What Governor Brown’s May Budget Proposal Means for UC
UC President Mark Yudof and Governor Jerry Brown are working out a deal behind closed doors that will loosen the most important ties between the university and the state.
Although they will both praise the deal by saying that it “stabilizes” funding while granting greater “flexibility,” its essence is that each will let the other off the hook: UC will mute complaints that it does not get enough money from the state and the state will stop holding UC accountable for the money it still gets.
The likely result is that UC will dump a larger number of eligible Californians onto the CSU and Community Colleges, which will in turn pass on their overflow to for-profit schools, where students take on inordinate amounts of debt with a very high likelihood of default.
Here are some key elements of the deal:
* UC will continue to raise tuition-at least 6% based on the Governor’s January budget proposal, likely more now that the Governor’s May revise reduces UC funding by $38 million, and much more if the Governor’s fall tax initiative fails to pass. (http://www.universityofcalifornia.edu/regents/regmeet/may12/f8.pdf, pg. 2)
* UC will no longer promise the state that it will admit a fixed number of California students in return for the enrollment funding that the state provides. For next year, and presumably from now on, UC will be allowed to use taxpayer funding as it pleases, without being accountable for the number of in-state students it educates (http://www.lao.ca.gov/analysis/2012/highered/higher-ed-020812.pdf, pg. 19). This means that UC is likely to enroll fewer California students, and to replace them with out-of-state and international students who pay more. The likely result is that UC will be able make more on average from its enrollments, that the state is likely to pay less, and that middle-income Californians will get less access to UC.
* UC will henceforward be allowed to commingle the state funds it uses for operations, such as teaching, with the funds it uses to pay debt service on new construction (http://www.dof.ca.gov/documents/2012-13_May_Revision.pdf, pg 43). UC has said that this added “flexibility” in its use of both state and non-state funds will allow it to squeeze out more for operations by delaying or stopping unnecessary construction projects. But since 2004 it has been doing the opposite, squeezing operational budgets that could be funded by higher tuition to leverage more construction. The state should have held UC accountable for its use of higher tuition on California students to gain greater access to the construction bond markets, which were impressed by its ability to increase enrollments while raising prices. Instead, the state will give UC carte blanche in its use of both state and non-state funds. It might use this greater flexibility to spend more on construction. But from now on no one will ask, and no one will know.
Finally, UC will be able to say that how much it spends to educate Californians and how many of them it enrolls is its own business, and not the state’s. If UC thinks its traditional mission is a money-loser, it can now use its continuing, but declining, revenues from the state to diversify into fields where it sees a brighter future. It will not be expected to draw on its other, more entrepreneurial, activities to subsidize public higher education, but instead will be allowed to use state educational funds to subsidize these other activities — and especially the capital projects necessary to get them off the ground.
The core of the agreement between the Governor and UC is that UC will no longer be held accountable for its priorities in the use of any of its resources (public or private) — and especially for making it a priority to educate Californians.
Under Governor Schwarzenegger, UC got the state to agree that it should provide only as much public higher education for Californians as the state is willing to pay for. Under Governor Brown it will be free to provide even less than the state is willing to pay for. Unless this agreement is reversed, state funding for UC will continue to fall as UC separates itself from the rest of California’s Master Plan. We are reaching the point of no return.
Here’s a video capture via Occupy the Stream of a Livestream broadcast of the raid at 6:30 this morning by UC Berkeley and Albany police, ending with the videographer’s arrest
From the San Francisco Chronicle’s Michael Cabanatuan:
Police cleared out Monday morning the small group of protesters who had set up an urban farming camp in a patch of UC Berkeley agricultural research land in Albany.
University police officers in riot helmets gave the protesters 1o minutes to leave the Gill Tract before they marched across the fields near Marin and San Pablo avenues about 6:15 a.m. The handful of protesters who had not obeyed the police order were sent scurrying off the property and onto San Pablo, which is closed to traffic.
Two protesters were arrested for trespassing after they disobeyed police orders to leave the property, said Lt. Eric Tejada, a police spokesman.
UPDATE: The latest from Occupy the Farm, posted at their blog:
Gill Tract Farm Raided, Reconverge Tomorrow 5 PM at the Albany Community Center
Well over 100 UCPD and Alameda County Sherriffs officers, armed with less-than-lethal impact-force projectiles, 36″ batons, and pepper-ball guns, arrested about five people at the Gill Tract Farm near 7 AM on Monday morning.
The Gill Tract Farmers Collective has called for a reconvergence meeting at the Albany Community Center, 1249 Marin Ave., at 5 PM tomorrow.
At the time of this post, the police officers occupying the Gill Tract escorted a large tractor onto the farmland.
UPDATE II: UC Berkeley has now released an official statement on the raid.
Here’s the opening:
Early this morning officers from the UCPD, along with personnel from other UC police departments, began taking the steps necessary for UC Berkeley to regain full control and supervision of our property in and around the Gill Tract. After weeks of patient dialogue, engagement and rejected offers of compromise, we deeply regret that the occupiers’ actions and continued insistence on free and unfettered access to what is an open-air laboratory left us no choice but to take this step. As the occupiers said in their statement rejecting our invitation to participate in efforts to sustain urban agriculture, “We’re not ceding control or supervision.”
It is no cause for celebration that the involvement of law enforcement is required to secure our fundamental property rights and protect a core value that is an indivisible part of who we are: academic freedom; the ability of our faculty and students to pursue their scientific interests without interference. We have said from the beginning that we would honor our commitment to protect the university’s rights and values.
UPDATE III: Christopher Yee of the Daily Californian has the final arrest tally:
UCPD arrested 9 protesters as they retook control of UC-owned land in Albany Monday morning.
Officers from UC Berkeley and seven other UC campuses issued a dispersal order to the protesters — most of whom were outside the east gate to the land near the corner of San Pablo and Marin Avenues — at 6:15 a.m.
Two protesters were arrested after remaining on the land, known as the Gill Tract, and seven were arrested outside of the encampment’s entrances for unlawful assembly.
Occupy the Farm declined UC Berkeley’s for a meeting on the university’s terms, but they did give up their encampment today — but they’re not giving up their farming activities at the Cal-owned Gill Tract.
While the activists didn’t post a statement of their own at their website, they did reprint an article from Nanette Asimov of the San Francisco Chronicle:
Occupy the Farm protesters agreed Saturday to end their three-week encampment on UC Berkeley property in Albany, but rebuffed an invitation from the university to discuss how the area can be used for both urban farming and for research.
Instead, the several dozen protesters set up ladders to scale the fence UC had erected around the area along San Pablo Avenue known as the Gill Tract and said they will continue to tend the vegetables and fruit trees they’ve planted on 2 of the 5 disputed acres.
As a result, the UC regents said they won’t drop the civil lawsuit they filed Wednesday accusing 13 protesters of trespassing.
More from Rick Hurd of the Contra Costa Times:
The group agreed to end their three-week encampment on the university property in Albany and dismantled much of its encampment Saturday morning, UC Berkeley spokesman Dan Mogulof said. But by 3 p.m., several people continued to use the area known as the Gill Tract and some tents remained, he said. Occupiers have said they will continue to do their own farming on the land.
Mogulof said the “window is still open” for a voluntary exit by protesters, but that they are “short on time,” because the research season begins next week.
And from the Daily Californian’s Christopher Yee:
Occupy the Farm spokesperson Anya Kamenskaya said they will remove camping-related structures but continue to stay and farm the land. She said some protesters will camp outside the fence surrounding the tract though they had not yet worked out details as to how that would work.
“We’re moving our living infrastructure off-site to be painfully obvious that the issue isn’t camping,” Kamenskaya said. “The issue is farming — making sure people have access to the farm, allowing farmers and the community to come out and support us by planting and watering.”
It’s an clever ploy, and it’ll be interesting to see how the university responds.
As we suspected, UC Bertkeley Police completed the second [or third] phase of their campaign against the Occupy the Farm activists now camped at the university Gill Tract.
From their blog:
Today, May 10, 2012 at approximately noon, the UCPD closed off the last remaining pedestrian access to the Gill Tract by chaining and locking the gate at San Pablo and Marin Avenues. For the past 24 hours, that gate had remained open, and despite a heavy police presence people had been able to enter and exit freely through it.
This represents the latest in a series of measures taken by the UC Administration to force the Farmers off of this piece of public farmland. To date, the UCPD has cut off all water to the Gill Tract, incapacitated the fire hydrant on the land, placed concrete barriers around the land preventing vehicular access, and locked all entrances shut. Farmers note that these actions threaten more than just their plants: that in this dry, windy weather, which poses a high fire-risk, there are no working fire hydrants on the land, and significantly restricted access points for firefighters and exits for people on the land.
Farmers are upset that the UC Administration is preventing scientists from carrying out their research on the Gill Tract. For the second day, UC Berkeley Professor Miguel Altieri has come to the Gill Tract to attempt to plant his crops. Whereas the Gill Tract Farmers Collective has directly assisted Altieri with his planting effort, the UCPD has physically prevented him from planting his dry-farmed tomato crop, saying he has no “authorization” to do his research. Professor Altieri says that he is “disappointed that the University has missed this opportunity to acknowledge that a coexistence of researchers and occupiers is possible, and that they have blocked access to my experimental plot.”
The university’s moving a lot faster against the activists who want to see Gill Tract preserve and transformed into demonstration teaching farm for sustainable community gardens than they did against the treesitters, in part because a lawsuit was pending against the stadium development project.
And the university added a new twist this time, lawsuits against the Occupy activists which are certain to result in large legal bills for someone, as well as civil damages.
If you’re wealthy enough to own a home in the Berkeley Hills, there’s a city law that guarantees your view of the Golden Gate.
But if you can’t afford the dough to buy or rent in the hills, there’s no comparable law guaranteeing your view of either San Francisco Bay or the Berkeley Hills.
The rich, the ones who bankroll city council elections, are guaranteed their view by city statute. The rest of us are simply stuck.
We learned about the hills view protection during our reporting days at the Berkeley Daily Planet when we covered land use issues.
Now Berkeley Mayor Tom Bates is trying to ram through a proposal that will destroy Bay views for the few flatlanders [a Berkeley term] lucky enough to still have views [we lost our Bay view a few years back].
The mayor, who suffers from a severe edifice complex, exacerbated by electile dysfunction caused by the hefty sums of developer cash his election campaigns suck in [his number one cash source in every election we covered].
Bates, who once played a Rose Bowl game for UC Berkeley’s Golden Bears and loves to hobnob with the rich and powerful [many of whom share his passion for architectural erections].
He’s an older fellow, and like so many older fellows in politics, he’s consumed with leaving a legacy — making his mark on the face of the community.
And he’s got all those smart, rich guys whispering sweet somethings in his ear, and then there’s his alma mater, which has its own grandiose ambitions to remake the landscape.
That constellation of interests is now engaged in building a Berkeley West Wall, an impregnable ten-story architectural corporate lab park, housing start-ups created on the work of UC Berkeley’s scientific serial entrepreneurs.
Guys like Jay Keasling, Cal’s celebrity “bioengineer .“ He’s started three companies, including Amyris, which started in Berkeley, then moved to nearby Emeryville when it outgrew its quarters in West Berkeley.
Both UC Berkeley and Bates celebrated in Keasling’s company, which first promised a vastly cheaper antimalarial drug shaped in the guts of genetically engineered bacteria, replacing the natural plant-derived drug and depriving thousands of small farmers of a much-needed cash crop. They engineered the bug to do it, with the help of cash from Bill Gates, then turned production over to Big Pharma’s Sanofi-Aventis.
Oh, and the drug costs just as much as the plant derivative.
Keasling made a fortune when Amyris went public, but few others have done as well. The stock has tanked, from a high of $33.85 to today’s closing at a penny over two bucks. There have been layoffs, too.
Designing for failure
So are those much-vaunted start-ups the key to West Berkeley’s success?
The Bureau of Labor Statistics recently published a study of start-ups, and the news is grim:
The number of jobs created by establishments less than 1 year old has decreased from 4.1 million in 1994, when this series began, to 2.5 million in 2010. This trend combined with that of fewer new establishments overall indicates that the number of new jobs in each new establishment is declining.
And then there’s this from Harvard Business School:
The statistics are disheartening no matter how an entrepreneur defines failure. If failure means liquidating all assets, with investors losing most or all the money they put into the company, then the failure rate for start-ups is 30 to 40 percent, according to Shikhar Ghosh, a senior lecturer at Harvard Business School who has held top executive positions at some eight technology-based start-ups. If failure refers to failing to see the projected return on investment, then the failure rate is 70 to 80 percent. And if failure is defined as declaring a projection and then falling short of meeting it, then the failure rate is a whopping 90 to 95 percent.
And here’s the icing on the cake, as reported by CNN a year ago:
When it comes to small business success, California is the not-so-Golden state — at least that’s what a recent report from Dun & Bradstreet suggests.
California’s small business failure rate was 69% higher than the national average, the worst of all the states, the report said.
But for Mayor Bates and his allies in the real estate and construction trade, those sobering figures apparently mean very little.
They’re quite willing to displace artisans and workers in established small industries to make way for those glamorous sounding high tech jobs.
Besides, those folks don’t give him all that money he needs to run for reelection, and they’re not as, well, accommodating as the folks with the large degrees and ever larger egos.
So what if he has to destroy a community to leave his mark on the city?
Say, maybe he could push for a hotel in the hills, say about halfway down the slope. Great views from the rooms, a unique location?
Nah, the view protection law would bar it, and even if there weren’t any view law, that’s where his donors live.
Say what you will about UC Berkeley’s often ham-fisted and baton-armed attempts to disrupt the Occupy movement, this time they’ve pulled a really clever move.
Before sending in the boys and girls in blue to bust the Occupy the Farm folks who are camped out at the university’s Gill Tract agricultural plot, they’re sending in the lawyers first, suing 14 Occupy participants for civil and punitive damages and the university’s legal fees.
It’s a strategy that doesn’t look as bad to the camera lens, and it’s one that could cost the activists a lot more cash than he nominal sums levied for trespass convictions if they find themselves on the losing side of litigation.
Here’s the university’s press release on the litigation:
Today the University of California commenced legal action against 14 individuals alleged to have participated in the illegal occupation of the university’s Gill Tract property. This lawsuit represents an additional step that the university is taking to regain control of its property so that it can be used for agricultural research and education. At the same time, the occupiers still have the opportunity to accept a proposal that would allow for a peaceful end to the illegal encampment, resumption of research activities and the continuation of urban farming on portions of the land that will not be utilized by faculty and students.
The suit, filed in Alameda County Superior Court today, alleges that the defendants, along with other unknown individuals who are sued as “Does,” conspired to cut locks, enter the property illegally and establish an illegal encampment. It alleges that the defendants continue to trespass on the property, despite repeated warnings from the UC Police Department that their presence is illegal. The suit alleges that the defendants’ illegal occupation is preventing research and educational activities on the property and that “if defendants do not leave the property immediately, the growing season will be lost,” resulting in substantial harm to researchers, students and the university. The suit requests a court order requiring the defendants to leave the property.
The university is also seeking an award of monetary damages for costs it has or will incur as a result of the trespass and for the rental value of the land during the occupation. The university also seeks payment by the defendants of its attorney’s fees under a state law that allows it to recover fees in a lawsuit involving “trespassing on lands . . . under cultivation.”
This legal action is not the only step that the university is prepared to take to protect the rights of its researchers and students, but it is one part of our efforts to end this illegal occupation. Among other things, it is a means to ensure that the trespassers — rather than the university, students and taxpayers — will bear the substantial expenses resulting from unlawful acts.
The lawsuit itself is posted online here [PDF].
Named in the action are Occupy activists Anya Kamenskaya, Gopal Dayaneni, Devin Murphy, Stefanie Rawlings, Eric Larsen, David Grefarth, Russell Bates [Berkeley], Alexandra Cano [Berkeley], Vaden Dabney [Oakland], Erik Eisenberg [Oakland], Elizabreth Fairweather [Rancho Cucamonga], Marika Iyer, Nathan Pitts [San Ramon], Gabrielle Silverman, and Francisco Stierle [Berkeley].
UC Berkeley researcher denied opportunity to plant
Occupy the Farm hasn’t responded to the suit on their website, but they have posted other new developments, including the campus police blockade of vehicle access to the site.
In an interesting twist, the one UC Berkeley with permission to plant on the site, was told he lacked “authorization,” according to the latest bulletin:
Professor Miguel Altieri, researcher at the Gill Tract for 31 years, planned to begin planting his research plot with his students this morning. An hour before he was scheduled to begin, the UC administration barricaded the Gill Tract with concrete, metal barriers, and dozens of police who threatened farmers with “chemical agents and impact force.” In a blatant affront to academic freedom, Continue reading
One last picture to go with the series of pictures from the California Memorial Stadium images we posted in our Occupy the Farm story below.
About 200 Native Americans were allowed into the fenced-in oak grove at the stadium on 11 February 2008 to perform a ritual before the tree they dubbed Grandmother Oak. After the university felled the tree in September, the stump was turned our to Native Americans for ritual use.
Where the tree once stood is now the site of a very expensive gym with all the latest technical gadgets to train Cal’s athletic teams.
For more, see the story we wrote at the time for the Berkeley Daily Planet.
And click on the image to enlarge it.
The UC Berkeley strategy with the occupation of the university’s Gill Tract agricultural plot is beginning to look more and more like the same game plan used against the nation’s longest-ever urban tree-sit.
The tree-sit, launched on the day of the Big Game between Cal and Stanford 2 December 2006, ended on 9 September 2008.
That protest was launched to protect a grove that stood in the way of the university’s plans for a new high tech $200 million gym on the site and for renovation of California Memorial Stadium, which sits directly astride the Hayward Fault — the seismic rupture the U.S. Geological survey designates as the most likely site of the San Francisco Bay Area’s next major earthquake.
Before the final bills are paid, the total costs will run over a billion dollars.
Occupy the Farm protesters are fighting to save the East Bay’s last remaining plot of prime agricultural land from university development plans.
The tract was once home to the nation’s premiere agroecology research center, which sought to control farming pests with natural rather than chemical means.
The last agroecologist left on the site, Professor Miguel Altieri, was planting dry farming tomatoes today with the help of volunteers from the occupation.
Today was also the day UC Berkeley police closed off the site from vehicle access, the first step in a process of enclosure we suspect will follow the same basic pattern deployed against the treesitters.
In the tree-sit, as in the Gill Tract occupation, the university began by containing the site with fencing to keep out additional tree-sitters and deprive them of supplies. Only after a civil suit began challenging the university’s development plans did the campus cops finally allow the protesters to be supplied with food and water.
Today the university launched a similar action, as Chris De Benedetti of the Oakland Tribune reports:
Police on Wednesday morning blocked vehicle access to a UC Berkeley-owned farm that protesters have occupied for more than two weeks.
Several officers arrived at the farm at 6 a.m. and announced they were blocking the Jackson Street entrance to the property, said Ashoka Finley, a spokesman for the group calling itself “Occupy the Farm.”
While police erected a concrete barrier at the entrance, other officers patrolled the surrounding streets in vans and motorcycles, said Finley, who teaches urban agriculture at Richmond High School.
“It seems like this might be a slow-motion raid,” he said. “Part of the UC tactics is to flex their muscle.”
No arrests have been made and none of the protesters have been removed, UC Berkeley police Lt. Eric Tejada said.
Aggressive law enforcement began with a flurry of trespassing citations and stay-away orders barring the protesters from campus.
A fence followed, with a long delay in action as the lawsuit played out.
Police made periodic raids inside the fence, occasionally with cherry pickers to pluck protestors from their arboreal havens.
The final action was preceded by a chainsaw squad and the cutting of 40 of the 41 trees slated for demolition, leaving the last tree housing the last four tree-sitters [click on the image to enlarge].
One the final day, construction crews erected scaffolding around redwood as a crowd watched.
Then-UC Berkeley Police Chief Victoria Harrison had herself delivered by crane-suspended basket to make one last demand that the tree-sitters leave.
The last tree-sitter gave a gesture of defiance as police approached up the staircase built into the scaffolding.
After his surender came the inevitable perp walk.
Once they’d surrendered, the chainsaws were out again and the tree was felled.
We suspect the university will trying a similar strategy: Completely containment followed by a police action to remove the occupation.
The barricades are up and the university is getting ready to move in. The only question is when.
Latest statements from Occupy the Farm and Cal
First the Occupy the Farm’s response to the police blockade:
At 6:30 AM this morning, several dozen UC police officers brought a bulldozer to the Gill Tract, deposited large concrete barriers at gated entrances to the Gill Tract Farm, and U-Locked the gates shut. They threatened people with “chemical agents and impact force”, and appeared prepared to bulldoze and destroy the farm. Community members immediately mobilized to defend the farm, walking past police lines and hopping fences to get into the tract. The police since Continue reading
UPDATE: Just hit $1.96.
UPDATE II: Now at $1.91.
UPDATE III: $1.89. That’s down a full 25 percent since yesterday’s record low.
UPDATE IV: Shares closed at $1.99, down 23 percent from yesterday’s closing.
Holy GMO, Batman!
Yep, the stock of the company created by Jay Keasling UC Berkeley’s resident “celebrity bioengineer” with cash from Bill Gates, is sinking kke a stone. After hitting yesterday’s all-time low of $2.30,, it promptly tanked again this morning.
We’d bet a lot of folk whose shares were worth $33.85 just 14 months ago are wishing they’d sold then.
Should the stock hit a buck, which seems almost inevitable given the steep decline since the peak, the Emeryville-based firm would lose its NASDAQ listing.
That was the word today from CEO [and former BP vice president] John Melo.
The loses, which include $36.7 million from failed stock sales and the closure of the company’s U.S. ethanol distribution system, are nearly three times those of the first quarter of 2011.
The announcement heralds yet another setback of the UC-Berkeley-spawned genetic engineering company founded by Jay Keasling, Cal’s resident “synthetic biology” superstar and serial entrepreneur [he cashed out of Amryis long ago and has launched another, rival firm].
From the company’s announcement:
Aggregate revenues for the quarter ended March 31, 2012 were $29.5 million versus $37.2 million in the first quarter of 2011. This change in revenue was due to a decline in Amyris Fuels sales as Amyris executes the planned wind-down of this business line. Cost of products sold was $43.8 million versus $34.4 million, related to costs incurred in the delivery of Amyris Fuels products and costs associated with the production of Amyris renewable products. The Company also recorded a charge of $36.7 million in the quarter ended March 31, 2012 related to losses on purchase commitments and write-off of production assets. Research and development expense increased to $21.3 million from $19.7 million, and sales, general and administrative expense increased to $21.7 million from $16.0 million. First quarter 2012 GAAP net loss attributable to common stockholders was $94.5 million compared with $33.1 million in the same quarter of 2011. On a non-GAAP basis, excluding stock-based compensation expense and the losses from fixed purchase commitments and write-off of production assets, the net loss attributable to Amyris, Inc. common stockholders for the first quarter ended March 31, 2012 was $51.4 million compared to $29.1 million in the prior year. A reconciliation of GAAP to non-GAAP results is included in this release.
The Company’s balance at the end of the first quarter of cash, cash equivalents and marketable securities was $103.5 million.
Part of the losses stem from the decision by a major investor, the Fidelity group of funds, to liquidate two-thirds of their holdings in the firm, a bombshell dropped on investors Friday in advance of today’s earning statement.
Fidelity had plunged into Amyris with a massive and much-heralded $25 million buy of “senior unsecured convertible promissory notes” on 28 February.
There’s a name for it: The Amyris effect
The company’s shares hit an all-time low of $2.30 in early morning trading today, then recovered to $2.53 by market close.
The collapse of Amyris share prices — from $33.85 14 months ago to today’s record low — reflects a broader trend in the profiles of companies that have sought to bring genetic engineering to the task of producing new plant-based fuels.
Writing in Biofuels Digest, Jim Lane gives it a name:
Call it the Amyris effect — after the company that has struggled with the issues more than any other, in its pursuit of world-class scale. Why is it important? For one, poor post-IPO performance by the handful of companies that have made it through the IPO gate, is bound to impact the chances of others to come through later.
A board member departs
The company also filed an announcement with the Securities and Exchange Commission revealing that Samir Kaul, one of six partners at high profile “green” investment firm Khosla Ventures, has resigned as an independent director on the Amyris board:
On May 3, 2012, Samir Kaul resigned from the Board of Directors (the “Board”) of Amyris, Inc. (the “Company”), effective immediately. The Board simultaneously appointed Geoffrey Duyk, a partner of TPG Biotech (the growth equity and venture investment platform of the global private investment firm TPG) and a director of the Company from May 2006 to May 2011, to serve as a director effective immediately following Mr. Kaul’s resignation. The Board appointed Dr. Duyk to the Class I board seat previously held by Mr. Kaul. The Board also appointed Dr. Duyk to serve as a member of the Audit Committee in place of Mr. Kaul. At the same meeting, the Board appointed Carole Piwnica and John Doerr to serve as members of the Leadership Development and Compensation Committee, one to serve as a replacement for Mr. Kaul and one to serve as a replacement for Patrick Pichette, who previously had served on the Leadership Development and Compensation Committee.
TPG is another investor, holding 6.5 million shares.
Khosla Ventures was represented on the board not because of the size of their holdings [only 61,238 shares compared to the 11.9 million held by French oil giant Total] but presumably because firm founder Vinod Khosla is the leading celebrity investors in the green energy game.
More on the departures of two executives
The shares of the UC Berkeley-spawned genetic engineering company are back up to $2,48 as we write, with the company’s earning statement to come today.
UPDATE III: Shares closed at the all-time low of $2.47.
UPDATE II: Amyris shares hit another new low, $2.49.
UPDATE: Shares just hit another record low as we were posting. They’re now selling for $2.59.
Companies like to drop bad news on Friday. That’s because few people are interested in news on Saturday.
Amyris, the UC-Berkeley spawned genetic engineering company created by Val “bioengineer” Jay Keasling, dropped a bombshell on Friday afternoon: Their biggest mutual find investor, the Fidelity group of funds, is selling off two thirds of their holdings.
The company had trumpeted the news when Fidelity bought 6.2 million shares on 28 February, paying $5.78 a share.
As of market close Friday, those same shares were worth $2.73, and as we write, they’re going for $2.65, just four cents above the company’s all-time low of two weeks ago. Shares were going to $33.85 just 14 months ago.
In a prospectus Amyris filed to sell the Fidelity shares, the company made the usually cautionary disclosures.
These in particular caught our eye:
We have very limited experience producing our products at the commercial scale needed for the development of our business, and we will not succeed if we cannot effectively scale our technology and processes.
[O]ur technology may not perform as expected when applied at commercial scale on a sustained basis, or we may encounter operational challenges for which we are unable to devise a workable solution. For example, in 2011 at our contract manufacturing facilities, contamination in the production process, problems with plant utilities, lack of automation and related human error, process modifications to reduce costs and adjust product specifications, and other similar challenges decreased process efficiency, created delays and increased our costs. Such challenges are likely to continue as we and our contract manufacturing partners develop our production processes and establish new facilities.
Back in 2010, in a video produced for Lawrence Berkeley National Laboratory, where he hangs his hat as the lab’s chief synthetic biologist, Keasling blithely dismissed any problems with scaling up. As he observes in the video “They scale beautifully.”
To which we can only add, except when they don’t.
Back to the prospectus, where we discovered this little item:
The 4,173,622 shares of common stock covered by this prospectus may be acquired by the selling stockholders from us by electing to convert the senior unsecured convertible promissory notes issued to the selling stockholders pursuant to the Securities Purchase Agreement, dated February 24, 2012, by and between us and the selling stockholders. We agreed to file a registration statement with the SEC covering the resale of the shares issuable upon conversion of the unsecured senior convertible promissory notes referenced above.
Note that word “unsecured.”
UPDATE: Some background
Amyris was started by Keasling and funded by Bill Gates to used genetically engineered microbes produce a cheap version of the antimalarial artemisin to replace the drugg naturally derived from artemisia, the wormwood plant, which is cultivated by thousands of farmers in Asia and Africa.
They next converted the microbe to produce precursors of fuel from plant cellulose. So far the process has been used mainly to produce higher cost chemicals for use in cosmetics, and mass-produced fuel remains a dream, thanks to those scale-up problems Keasling blithely assured us weren’t a problem.
Then, just two weeks ago, the company announced it was dumping its U.S. ethanol distribution system,
Just what the future holds for the company remains very much in doubt, and just how long the other major institutional investors will be willing to accommodate massive losses before forcing a bankruptcy remains an open question.
Some shots we took last Monday while visit the Occupy the Farm encampment as the shut began to sink in the west, adding that warmth of light that makes it what photographers call “the golden hour.” Click on any of the images to enlarge.
Time for a musical interlude. . .
Tools and supplies laid down for the day. . .
While the signs remain on alert. . .
Occupy the Farm [previously], the ongoing launched-on-Earth-Day Occupation of UC Berkeley’s Gill Tract agricultural plot, continues.
While the university had wrongly claimed the action had no support from researchers who worked at the site [Miguel Altieri], the action has also enlisted some other notable faculty support [Claudia Carr, Paul Rabinow, Laura Nader, etc.]
Now consider this excerpt of a statement by Professor Jeffrey M. Romm of Cal’s Department of Environmental Science, Policy, & Management, who specializes in natural resource and environmental policy. Posted at the Occupy the Farm website:
The current Gill Tract issue replicates the kind of problem that many college researchers have worked successfully to overcome, i.e. structural divides that prevent effective ecosystem management in large part by excluding those with the strongest motives for beneficial action. Faculty and students so involved cannot be expected to turn their backs on the core lessons of their careers. The mutual benefits of overcoming the divide and achieving cooperative relations between campus and community are so demonstrable and compelling that a number of faculty would not maintain their integrity if siding with the party that refuses opportunities for cooperation and adaptability.
The Gill Tract occupation creates a huge opportunity. After fifteen years of stonewall in the midst of sweeping social and ecological changes, the occupation should have come as no surprise to anyone. It does come at a time, though, when the university has become surrounded by community generated agricultural enterprise and has established its own capacity to respond in truly excellent fashion. The occupation has been conducted with utmost respect for the university, the community and the land. Equivalent responses by the university would produce a major step forward for everyone. The meaning and matter of Gill Tract extend throughout the Bay Area, with the potential for much more.
Romm’s insights are particularly noteworthy in light of his expertise, particularly as described in this excerpt from his web page:
Distribution, Growth, and Resource ‘Sustainability’: Our group studies how the dynamics of social distribution, economic growth, and ecosystems interact and respond to alternative forms of policy and organization. These studies range through farm, village, watershed, county, state, and national to global scales of analysis. The conceptual frameworks are chosen to suit the particular problem of interest, but come primarily from political science, ecology, economics and sociology. Members of the group, although each is focused on one or several of these disciplines, develop a shared capacity in the work of all members. Specific topics have included, for example: the dynamics of irrigation, groundwater and watershed regimes (India, Samoa, Philippines, United States); regional patterns of soil enhancement, conservation and decline (Philippines, Nepal); adoption of agroforestry, social forestry and community forestry at farm, village and regional levels (India, Nepal, Bangladesh, United States); forest and land use dynamics and ecological change (Thailand, China, Vietnam, India, Sri Lanka, United States); impacts of national and state policies on resource use and environmental possibilities (Vietnam, United States, India).
In short, just the sort of guy about the right use of the last urban farmland acreage left along San Francisco Bay’s urban eastern shore.