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    US Supreme Court Rules In Favour Of Monsanto In Patent Exhaustion Case

    Published on 13 May 2013 @ 9:40 pm

    By , Intellectual Property Watch

    The United States Supreme Court found today that a farmer who buys patented seeds may not reproduce them through planting and harvesting without the right holder’s permission. The case, known as Bowman v. Monsanto, revolved around patent exhaustion. The Supreme Court was to decide whether patent exhaustion applied to patented seeds after their authorised sale.

    According to the ruling of the Supreme Court [pdf], “Under the doctrine of patent exhaustion, the authorized sale of a patented article gives the purchaser, or any sub­sequent owner, a right to use or resell that article. Such a sale, however, does not allow the purchaser to make new copies of the patented invention.”

    “The question in this case is whether a farmer who buys patented seeds may repro­duce them through planting and harvesting without the patent holder’s permission. We hold that he may not,” said Justice Kagan, delivering the opinion of the court.

    The case pitted a US farmer against agro-industry giant Monsanto on the issue of patent exhaustion in patented seeds. Vernon Bowman, a US farmer, was originally sued by Monsanto for infringement of its patented technology. The Indiana farmer, who had acquired a mix of commodity soybean seeds from a local grain elevator containing Monsanto patented seeds, planted the seeds, then sprayed them with the herbicide glyphosate to which Monsanto “Roundup Ready seeds” are resistant. He then harvested the seeds and replanted some of them. This constituted patent infringement, according to Monsanto (IPW, US Policy, 5 March 2013).

    The Vernon Hugh Bowman v. Monsanto Company and Al. case was heard by the Court of Appeals for the Federal Circuit, which ruled in favour of Monsanto.

    Bowman, who bought Roundup Ready soybean seeds every year for his first crop of the season, found he did not want to pay premium price for his second crop of each season, as he considered the late season planting risky, according to the opinion of the court.

    Grain elevators carry a mix of seeds coming from different local farms and are mainly used for human and animal consumption. Since most of those local farms use Roundup Ready soybean seeds, the Court found that Bowman “could anticipate that many of the purchased soybeans would contain Monsanto’s patented technology.”

    According to the Court’s opinion, the argument of patent rights exhaustion brought forward by Bowman, saying that the rights were exhausted because they were subject of a prior authorised sale from the local farmers to the grain elevators, was dismissed by the district court, which awarded US $84,456 in damages to Monsanto. This decision was upheld by the Federal Circuit court on the reasoning that Bowman had “created a newly infringing article.”

    Under the patent exhaustion doctrine, the court said, “Bowman could resell the patented soybeans he purchased from the grain elevator; so too he could consume the beans himself or feed them to his animals.”

    In that case, “Monsanto, although the patent holder, would have no business interfering in those uses of Roundup Ready beans. But the exhaustion doctrine does not enable Bowman to make additional patented soybeans without Monsanto’s permission (either express or implied).”

    At question was also the broader issue of self-replicating items. In this instance, the Supreme Court said inventions that could lead to self-replicating products “are becoming ever more prevalent, complex and diverse.” In some cases, they said, the product’s self-replication “might occur outside the purchaser’s control. Or it might be a necessary but incidental step in using the item for another purpose.” This directly refers to copyrights and the copy of computer program on a computer necessary to run the programme, as this is not considered as copyright infringement, they said.

    “In the case at hand,” the court said, “Bowman planted Monsanto’s patented soybeans solely to make and market replicas of them, thus depriving the company of the re­ward patent law provides for the sale of each article. Patent exhaustion provides no haven for that conduct. We accordingly affirm the judgment of the Court of Appeals for the Federal Circuit.”

    Monsanto Hails Decision

    In a release today, Monsanto said the US Supreme Court in a unanimous ruling “affirmed its support for protecting U.S. innovations that are a critical part of supporting the world’s growing needs.”

    The Supreme Court’s decision, they said, “affirms the basic purpose of the U.S. patent system – providing an incentive to innovate by providing inventors a meaningful opportunity to recover costs on their R&D investments.”

    David Snively, Monsanto executive vice president, secretary, and general counsel, said, “The Court’s ruling today ensures that longstanding principles of patent law apply to breakthrough 21st century technologies that are central to meeting the growing demands of our planet and its people,” according to the release.

    Catherine Saez may be reached at info@ip-watch.ch.

     

    Comments

    1. U.S. GMO food labeling drive goes Global – May 25, 2013 | Ishtarmuz's Blog says:

      [...] May 13, 2013 Intellectual Property WatchU.S. SUPREME COURT RULES IN FAVOR OF MONSANTO IN PATENT EXHAUSTION CASE  http://www.ip-watch.org/2013/05/13/us-supreme-court-rules-in-favour-of-monsanto-in-patent-exhaustion… [...]

    2. IntellectualPropertyWatch – Catherine Saez – US Supreme Court Rules In Favour Of Monsanto In Patent Exhaustion Case – 14 May 2013 | Lucas 2012 Infos says:

      [...] http://www.ip-watch.org/ link to original article [...]

    3. Radical Gardening | infraredbiped says:

      […] wash their meat in ammonia. Or, imagine that seed sharing and small-scale farming become tangled in ruinous intellectual property battles. Or, imagine that concerns about safety and local ecology are abused to super-regulate seed […]


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    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website. By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website.

    By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    1. You agree that you are fully responsible for the content that you post. You will not knowingly post content that violates the copyright, trademark, patent or other intellectual property right of any third party or which you know is under a confidentiality obligation preventing its publication and that you will request removal of the same should you discover that you have violated this provision. Likewise, you may not post content that is libelous, defamatory, obscene, abusive, that violates a third party's right to privacy, that otherwise violates any applicable local, state, national or international law, that amounts to spamming or that is otherwise inappropriate. You may not post content that degrades others on the basis of gender, race, class, ethnicity, national origin, religion, sexual preference, disability or other classification. Epithets and other language intended to intimidate or to incite violence are also prohibited. Furthermore, you may not impersonate others.

    2. You understand and agree that Intellectual Property Watch is not responsible for any content posted by you or third parties. You further understand that IP Watch does not monitor the content posted. Nevertheless, IP Watch may monitor the any user-generated content as it chooses and reserves the right to remove, edit or otherwise alter content that it deems inappropriate for any reason whatever without consent nor notice. We further reserve the right, in our sole discretion, to remove a user's privilege to post content on our site. IP Watch is not in any manner endorsing the content of the discussion forums and cannot and will not vouch for its reliability or otherwise accept liability for it.

    3. By submitting any contribution to IP Watch, you warrant that your contribution is your own original work and that you have the right to make it available to IP Watch for all purposes and you agree to indemnify IP Watch, its directors, employees and agents against all damages, legal fees and others expenses that may be incurred by IP Watch as a result of your breach of warranty or of these terms.

    4. You further agree not to publish any personal information about yourself or anyone else (for example telephone number or home address). If you add a comment to a blog, be aware that your email address will be apparent.

    5. IP Watch will not be liable for any loss including but not limited to the following (whether such losses are foreseen, known or otherwise): loss of data, loss of revenue or anticipated profit, loss of business, loss of opportunity, loss of goodwill or injury to reputation, losses suffered by third parties, any indirect, consequential or exemplary damages.

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    7. You acknowledge and agree that you use and/or rely on any information obtained through the discussion forums at your own risk.

    8. For any content that you post, you hereby grant to IP Watch the royalty-free, irrevocable, perpetual, exclusive and fully sub-licensable license to use, reproduce, modify, adapt, publish, translate, create derivative works from, distribute, perform and display such content in whole or in part, world-wide and to incorporate it in other works, in any form, media or technology now known or later developed.

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