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Monsanto Likely to Score Supreme Court Win with Far-Reaching Benefits for Corporate Farming

Why a legal dispute over soybeans could be a major win for corporate food producers.

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Then, hoping that most of the soybeans he planted were Roundup Ready, he sprayed them with Roundup herbicide. The non-Roundup Ready plants died; the Roundup Ready plants lived. Bowman raised those plants to maturity, harvested the crop – and saved some of it to replant as seeds in the future.

In 2006, Monsanto investigated Bowman and Bowman cooperated. In early 2007, Bowman told Monsanto what he had done. He says he thought it was legal. Monsanto sued him later that year.

The case first went to a district court, and then to a federal circuit court. Bowman lost both times. The court awarded Monsanto $84,456.20. Now, this case is before the U.S. Supreme Court.

Bowman’s argument – explained by his lawyer Mark P. Walters – rests on a concept called patent “exhaustion.” Patent exhaustion means that after an initial authorized sale of a patented item, the patent owner has no more patent rights to that item. Company X makes its patented widget, sells it to you, and you do what you want with it. If you decide to sell it for $2 at a garage sale, Company X has no right to your $2. It's already made its profit on the initial sale and its rights to the patented item were then exhausted.

Of course, as Chief Justice Roberts put it, “Why in the world would anybody spend any money to try to improve the seed if as soon as they sold the first one anybody could grow more and have as many of those seeds as they want?”

Walters argued that allowing Monsanto to continue holding rights over its seed after the initial sale of the seeds is tantamount to “taking away the ability of people to exchange these goods freely in commerce.”

But Justice Breyer did not seem to buy that, saying, “You know, there are certain things that the law prohibits. What it prohibits here is making a copy of the patented invention. And that is what he did.”

Justice Sotomayor added, “I’m sorry. The Exhaustion Doctrine permits you to use the good that you buy. It never permits you to make another item from that item you bought.” Based on this exchange and others, veteran watchers of the court feel confident that Monsanto will win this one.

At issue here are “self-replicating” technologies like seeds or software. When U.S. patent law was first written, perhaps the authors never imagined that some day someone might create something that could reproduce itself like a seed.

Another issue arose during the oral arguments surrounding the complexity of various generations of soybean seeds. Monsanto produces patented seeds, sells them, and receives payment for them. That much is clear. But when those seeds are planted and they produce a second generation of seeds, are Monsanto’s patent rights exhausted? Or, because they are a new generation of brand-new seeds, do they create with them a new set of patent rights for Monsanto?

Also in question is the “use” of Monsanto’s invention – its patented genes. Monsanto’s patent is on the DNA it inserted into the soybeans via genetic engineering, not on the beans themselves. Walters argued that the one and only use for this invention is planting the seeds and growing them. Justice Breyer countered by asking “Don’t people or animals eat them?” but Walters replied that “That is certainly a use, but it’s not the invention… Exhaustion is about conferring on the purchaser a right to use the invention.”

In other words, yes, one can eat soybeans or feed them to animals, but that is not a use of Monsanto’s patented invention – the Roundup Ready genes. The way one uses the patented Roundup Ready trait is by planting the seeds, growing soybean plants, spraying them with Roundup herbicide, and killing only the weeds but not the plants.

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