Monsanto Seed Patent Dispute Goes To Supreme Court

Los Angeles – The U.S. Supreme Court on Friday said it would take up a soybean farmer’s appeal of Monsanto Co.’s successful patent infringement claims against him over his use of second-generation patented herbicide-resistant seeds.

The case presents the question of how far the limits of patent infringement protection extend with regard to farmers planting the progeny of genetically altered seeds covered by U.S. patents. In September 2011 the Federal Circuit affirmed an Indiana district judge’s grant of summary judgment to Monsanto in its case against Vernon Bowman alleging infringement of U.S. Patent Numbers 5,352,605 and RE39,247E

Monsanto invented and developed technology for genetically modified “Roundup Ready” soybeans that exhibit resistance to glyphosate-based herbicides, such as Monsanto’s Roundup product. The ’605 and ’247E Patents cover different aspects of the Roundup Ready technology.

The company has marketed and sold Roundup Ready soybean seeds under its own brands since 1996, and licenses the technology to seed producers who insert the Roundup Ready genetic trait into their own seed varieties.

All sales of Roundup Ready to growers are subject to a license agreement, under which Monsanto restricts the grower’s use of the licensed Roundup Ready seed to a single commercial crop season because the patented Roundup Ready® genetic trait carries forward into each successive seed generation.

Although the express terms of the agreement forbid growers to sell the progeny of the licensed Roundup Ready seeds, or second-generation seeds, for planting, Monsanto authorizes growers to sell second-generation seeds to local grain elevators as a commodity, without requiring growers to place restrictions on grain elevators’ subsequent sales of that seed.

Commodity seeds are a mixture of undifferentiated seeds harvested from various sources, including from farms that grow Roundup Ready soybeans and those that do not. 94 percent of Indiana’s acres of soybeans planted in 2007 were planted using herbicide resistant varieties.

Bowman planted Roundup Ready seeds as his first crop in each growing season from 1999 through 2007 and, in line with the license agreement, did not save seed from his first crop during any of those years. In 1999, ne also purchased commodity seed from a local grain elevator for a late-season planting, or second crop.

Because Bowman considered the second crop to be a riskier planting, he purchased the commodity seed to avoid paying the significantly higher price for Pioneer’s Roundup Ready seed. Unlike his first crop, Bowman saved the seed harvested from his second crop for replanting additional second crops in later years. He also supplemented his second crop planting supply with periodic additional purchases of commodity seed from the grain elevator.

Monsanto investigated Bowman’s activities, and sued him in 2007 after determining that his second crop soybean seeds contained the patented Roundup Ready technology. The district court granted summary judgment of infringement in 2009 and awarded Monsanto roughly $85,000 in damages.

The Federal Circuit rejected Bowman’s argument that patent exhaustion applied to his accused second crop plantings.