Why do sponges produce toxins?

1. In a few marine species, gray cells of the sponges primitive "immune" system and can release toxins that kill all cells in the area as part of the rejection of foreign material.
2. They also produce toxins that prevent other sessile organisms such as bryozoans or sea squirts from growing on or near them.
3. A few species, such as the Caribbean fire sponge, cause a severe rash in humans who handle them and such toxins may protect against predators.
4. The Caribbean chicken-liver sponge secretes toxins that kill coral polyps, allowing the sponges to grow over the coral skeletons.

See: http://en.wikipedia.org/wiki/Sponge