Supreme Court Sides With Monsanto

The U.S. Supreme Court recently sided with Monsanto Co. in a closely watched case involving patented soybean seeds. The Court concluded that an Indiana farmer could not copy patented seeds through planting and harvesting without Monsanto’s permission.

The Facts of the Case

Monsanto holds patents for Roundup Ready soybean seeds, which contain a genetic alteration that allows them to withstand exposure to the weed killer. It sells the seeds subject to a licensing agreement that permits farmers to plant the purchased seed in one growing season. Farmer Hugh Bowman purchased Roundup Ready soybean seeds for his first crop of each growing season and followed the terms of the licensing agreement.

However, when it came to his riskier late-season planting, Bowman purchased soybeans intended for consumption from a grain elevator. He planted them and treated the plants with weed killer to preserve only the Roundup Ready soybean plants. He continued to use the seeds from these plants for several seasons.

After discovering this practice, Monsanto sued Bowman for patent infringement. Bowman raised the defense of patent exhaustion, which eliminates the patent holder’s right to control or prohibit the use of an invention after an authorized sale.

The Supreme Court’s Decision

The Supreme Court unanimously held that the doctrine of patent exhaustion did not allow Bowman to reproduce the seeds by planting and harvesting them. While the Court acknowledged that the doctrine allows purchasers to essentially do what they want with a purchased item, those rights only apply to the particular article sold. “It leaves untouched the patentee’s ability to prevent a buyer from making new copies of the patented item,” the Court stated.

As further explained in the opinion, “By planting and harvesting Monsanto’s patented seeds, Bowman made additional copies of Monsanto’s patented invention, and his conduct thus falls outside the protections of patent exhaustion. Were this otherwise, Monsanto’s patent would provide scant benefit. After Monsanto sold its first seed, other seed companies could produce the patented seed to compete with Monsanto, and farmers would need to buy seed only once.”

While the debate over Monsanto’s business practices and the danger of genetically modified foods will likely continue, the Supreme Court’s decision offers much-needed clarity regarding the limits of the doctrine of patent exhaustion, particularly its application to biotechnology.

If you have any questions about this case or would like to discuss the legal issues involved, please contact me, Fred Zemel, or the Scarinci Hollenbeck attorney with whom you work.