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Bowman v. Monsanto

Posted Monday, May 20, 2013 by Mike Cicero

A week ago today the Supreme Court held in the unanimous decision of Bowman v. Monsanto Co. that the doctrine of patent exhaustion does not permit a farmer to reproduce patented seeds through planting and harvesting without the patent holder’s permission. 569 U.S. __ (2012). The case revolved around a farmer’s use of Monsanto’s patented Roundup Ready soybean seeds, which are seeds which have been genetically modified to survive exposure to the herbicide glyphosate, beyond the scope of the license agreement Monsanto requires all of its customers to enter into. Under the terms of the license agreement, the farmers may not save any of the harvested seeds for replanting nor may they sell them to anyone else for that purpose. Essentially, the farmers are limited to planting the seeds for one (and only one season) and may then consume the resulting crop or may sell it as a commodity. Obviously Monsanto has a financial incentive for requiring farmers to purchase new seeds from the company each season rather than utilizing the seed’s self-replicative abilities to “make” new seeds.

Associate Justice Elena Kagan delivered the opinion and in doing so seemed to have very little difficultly in coming to her conclusions. Kagan emphasized that the holding was very narrow in writing that “[o]ur holding today is limited — addressing the situation before us, rather than every one involving a self-replicating product.” However, the decision may foreshadow the stance the Court will take regarding other situations where a product is self-replicating as were Monsanto’s patented seeds in this case.

Under the doctrine of patent exhaustion, “the initial authorized sale of a patented item terminates all patent rights to that item.” *Quanta Computer, Inc. v. LG Electronics, Inc., *553 U.S. 617, 625 (2008). The logic of the decision hinged on the argument that the doctrine of patent exhaustion restricts a patentee’s rights only as to the particular article sold and that when a farmer reproduces the seeds new articles are produced which have not been the subject of an authorized sale. Therefore, the doctrine of patent exhaustion in inapplicable as to the newly created seeds and Monsanto, therefore, retains the right to restrict the use thereof. “Because Bowman thus reproduced Monsanto’s patented invention, the exhaustion doctrine does not protect him,” Kagan explained. Although Bowman defended his actions by arguing that the soybeans naturally self-replicate and thus “it was the planted soybean, not Bowman” that made the replicas of Monsanto’s patented invention. Kagan seemed amused as she dismissed this “blame-the-bean defense” and noted that it was Bowman and not the beans that tended to and harvested eight successive soybean crops.

Kagan showed her concern for the implications of an opposite ruling. “[I]f simple copying were a protected use, a patent would plummet in value after the first sale of the first item containing the invention. The undiluted patent monopoly, it might be said, would extend not for 20 years (as the Patent Act promises), but for only one transaction. And that would result in less incentive for innovation than Congress wanted. Hence our repeated insistence that exhaustion applies only to the particular item sold, and not to reproductions.”

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