DuPont 2009 Annual Report Download - page 5

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Part I
ITEM 1. BUSINESS, continued
decrease in the number of worldwide patents from about 21,000 in 2008 to about 18,000 in 2009 is primarily from
decisions made by the company as part of its improved patent maintenance review process. DuPont’s rights under its
patents and licenses, as well as the products made and sold under them, are important to the company as a whole, and
to varying degrees, important to each reportable segment. For a discussion of the importance of patents to
Pharmaceuticals, see the segment discussion on page 34 of this report.
The environment in which Pioneer competes has been characterized by the use among competitors of new patents,
patent positions and patent lawsuits to gain advantage in commercial markets. Ownership of and access to intellectual
property rights, particularly those relating to biotechnology and germplasm, will continue to be important to Pioneer
and its competitors. Pioneer has a large collection of patents related to biotechnology and germplasm and also
licenses technology from others. Pioneer will continue to address the dynamic environment in which it competes
through a variety of means that includes protecting and enforcing its own intellectual property rights, challenging
claims made by others and, where appropriate, obtaining licenses to important technologies on commercially
reasonable terms. During 2007, Pioneer entered into a business agreement on corn herbicide tolerance and insect
control trait technologies with Monsanto Company. Among other provisions, modifications were made to the existing
corn license agreements; both parties agreed to exchange certain non-assert and other intellectual property rights; and
both parties obtained rights to reference and access certain regulatory data and approvals in which the other has
certain interests. See the Contractual Obligations table on page 39 for more information.
The company has more than 200 unique trademarks for its products and services and approximately 19,000 worldwide
registrations and applications for these trademarks. Ownership rights in trademarks do not expire if the trademarks are
continued in use and properly protected. The company has many trademarks that have significant recognition at the
consumer retail level and/or business to business level. Significant trademarks at the consumer retail level include the
DuPont Oval and DuPont(the ‘‘DuPont Brand Trademarks’’); Pioneerbrand seeds; Teflonfluoropolymers, films,
fabric protectors, fibers and dispersions; Coriansurfaces; Kevlarhigh strength material; Nomexthermal resistant
material and Tyvekprotective material. The company actively pursues licensing opportunities for selected trademarks
at the retail level.
Seasonality
Sales of the company’s products in the Agriculture & Nutrition segment are affected by seasonal cropping and weather
patterns. Sales and earnings performance in the Agriculture & Nutrition segment is strongest in the first half of the year.
The segment generally operates at a loss during the third and fourth quarters of the year. As a result of the seasonal
nature of its business, Agriculture & Nutrition’s inventory is at its highest level at the end of the calendar year and is sold
down in the first and second quarters. Trade receivables in the Agriculture & Nutrition segment are at a low point at
year-end and increase through the selling season to peak at the end of the second quarter.
In general, businesses in the remaining segments are not significantly affected by seasonal factors.
Marketing
With the exception of Pioneerbrand seeds and Solaesoy proteins, most products are marketed primarily through
DuPont’s sales force, although in some regions, more emphasis is placed on sales through distributors. Pioneer
brand products are promoted through multiple marketing channels in North America. In the corn and soybean markets
of the U.S. Corn Belt, products are sold through a specialized force of independent sales representatives. In other North
American markets, Pioneerproducts are marketed through distributors and crop input retailers. Pioneerproducts
outside of North America are marketed through a network of subsidiaries, joint ventures and independent producer-
distributors. Similarly, Crop Protection products are marketed and sold to growers and other end users through a
network of wholesale distributors and crop input retailers. Solaeisolated and functional soy proteins are marketed
using a combination of outside distributors, joint ventures and direct sales.
Major Customers
The company’s sales are not materially dependent on a single customer or small group of customers. However,
collectively, Performance Coatings and Performance Materials have several large customers, primarily in the motor
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