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will chime in with more info, but here's the basic answer:
Seed cleaning is an essential step in seed saving. In traditional agriculture, farmers would set aside part of their harvests to use as seed for the next planting season. However, most seeds can't be taken right out of the plant and put in storage. They must be dried properly, separated from dust and bugs, and then stored. Seed cleaning services would do this for the farmer for a small fee.
Monsanto's problem with the practice is that all the seed they sell contains patented, propriatary GMO components. When a farmer buys the seed, they essentially buy a license to use those genetic modifications--but for that season only. With each subsequent season, they must pay for more seed to get the ad hoc licensing. Often, farmers must sign contracts with Monsanto promising not to use seed from the GMO crops. Monsanto doesn't even like having fields of crops without their genetics in fields next to their GMO because pollen from the GMO crop could fertilize the natural crop, allowing the neighbor farmer to "steal" (their word) their patented technology.
Monsanto went after the gentleman in the film because, according to them, his service would encourage farmers to use save and use seed year after year without license. It was of course bull, but he couldn't afford to fight a long court battle, and they knew that at the start.
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