WASHINGTON — The Supreme Court of the United States unanimously ruled May 13 in favor of Monsanto in a landmark intellectual property law case involving patented seeds.
The Supreme Court determined Indiana farmer Vernon Hugh Bowman did not have standing under “patent exhaustion” to reproduce Monsanto’s patented seeds.
Bowman had legitimately purchased and planted Roundup Ready soybean seed, invented and patented by Monsanto. But he also bought commodity soybeans from a local grain elevator, planted them and treated them with the herbicide glyphosate, which killed all the plants without the Roundup Ready trait. He then harvested the remaining soybeans and saved some of these seeds, that contained the RR trait, to plant the next year.
Monsanto sued Bowman for patent infringement. Technically, a farmer doesn’t buy the patented seeds, but the license to use the patented technology in the seed.
A federal court in Indiana ruled in favor of Monsanto and awarded damages to Monsanto of $84,456. The Court of Appeals for the Federal Circuit upheld the case, before the Supreme Court agreed to hear the matter. (Read the Supreme Court’s opinion in Bowman v. Monsanto.)
Bowman’s patent exhaustion defense argued that Monsanto couldn’t control his use of the soybeans because they came from a prior authorized sale (from local farmers to the grain elevator).
Basically, the patent exhaustion doctrine states the first sale of a patented item “exhausts” the patent holder’s control over that particular item.
In the oral arguments heard Feb. 19, however, Justice Stephen G. Breyer said the infringement lies in the fact that Bowman made the seeds’ third generation (he had purchased both first and second generations).
“There are certain things that the law prohibits,” Breyer said. “That it prohibits here is making a copy of the patented invention. And that is what he did.”
Bowman’s attorney, Mark P. Walters, argued in February that the Exhaustion Doctrine has never been modified for self-replicating inventions like the seed case.
“But the exhaustion doctrine does not enable Bowman to make additional patented soybeans without Monsanto’s permission (either express or implied),” wrote Kagan in the Supreme Court’s opinion.
“Because Bowman thus reproduced Monsanto’s patented invention, the exhaustion doctrine does not protect him.”
Bowman had also argued that soybeans naturally “self-replicate or ‘sprout’ unless stored in a controlled manner,” and thus “it was the planted soybean, not Bowman” that made replicas of Monsanto’s patented invention.
The U.S. Supreme Court found that defense a little too ludicrous to accept, as Kagan’s opinion stated, “we think the blame-the-bean defense tough to credit.”
“Bowman was not a passive observer of his soybean’s multiplication; or put another way, the seeds he purchased (miraculous thought they might be in other respects) did not spontaneously create eight successive soybean crops,” Kagan wrote.
“… it was Bowman, and not the bean, who controlled the reproduction… of Monsanto’s patented invention.”
In its response to the ruling, Monsanto said the U.S. Supreme Court’s decision affirms the basic purpose of the U.S. patent system — providing an incentive to innovate by providing inventors an opportunity to recover costs on their R&D investments.
“The Court’s ruling today ensures that long-standing principles of patent law apply to breakthrough 21st century technologies,” said David F. Snively, executive vice president, secretary, and general counsel of Monsanto, in a prepared statement.