RESPONDENT: Monsanto Company, et al.
LOCATION: Knox County
DOCKET NO.: 11-796
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT: United States Court of Appeals for the Federal Circuit
CITATION: 569 US (2013)
GRANTED: Oct 05, 2012
ARGUED: Feb 19, 2013
DECIDED: May 13, 2013
Melissa Arbus Sherry - Assistant to the Solicitor General, Department of Justice, for the United States as amicus curiae
Mark P. Walters - for the petitioner
Seth P. Waxman - for the respondents
Facts of the case
In 1994, the United States Patent and Trademark Office granted a patent to the Monsanto Company for genetic material from a virus that can be used to incorporate new genetic material into a plant. In 2006, Monsanto patented a gene that makes plants resistant to the glyphosate-based herbicides that farmers can use on weeds. Both patents are included in the Monsanto Technology agreement which states that growers who purchase Monsanto's products may only use the seed for a single season and may not sell the seeds to any other grower. Growers may sell the second-generation seed to a grain elevator.
Vernon Hugh Bowman, a farmer in Knox County, Indiana, began purchasing Monsanto's Pioneer Hi-Bred seed in 1999 and followed the terms of the agreement by not saving any of his seed. Also beginning in 1999, Bowman purchased second-generation seed from a grain elevator for his second planting and saved seeds from that purchase for reuse later. In 2006, Monsanto contacted Bowman to examine his planting activities and found that his second-round crops contained the patented genetic material. Monsanto sued Bowman for patent infringement. The district court granted summary judgment for Monsanto. The United States Court of Appeals for the Federal Circuit affirmed.
Does a patent right for self-replicating technology expire after an authorized sale?
Media for Bowman v. MonsantoAudio Transcription for Oral Argument - February 19, 2013 in Bowman v. Monsanto
Audio Transcription for Opinion Announcement - May 13, 2013 in Bowman v. Monsanto
John G. Roberts, Jr.:
Justice Kagan has our opinion this morning in case 11-796, Bowman versus Monsanto Company.
Monsanto invented and then patented a genetic modification that enables soybean plants to survive exposure to glyphosate, the active ingredient in many herbicides.
Monsanto calls seeds carrying this trait, Roundup Ready seeds.
Monsanto will only sell Roundup Ready seed to farmers who sign a licensing agreement.
That agreement allows farmers to plant one and only crop of soybeans from the Roundup Ready seed they purchase.
The farmer can then consume the harvested beans or sell them as a commodity.
But the farmer cannot do according to the agreement is saved and replants the soybeans he harvests.
The petitioner in this case, Vernon Bowman, is a farmer who likes Roundup Ready technology.
For his first soybean crop each year, Bowman purchased Roundup Ready seed from a Monsanto affiliate and complied with the terms of the agreement, I just described.
But for his riskier, second soybean crop of each season, Bowman wanted a way to rip the benefits of Monsanto's technology without paying its premium prices.
The answer, Bowman decided, lay and buying seeds from the local grain elevator.
Soybeans from a grain elevator are meant for consumption, but because soybeans are themselves seeds nothing prevented Bowman from planting them.
And because most Indiana farmers used Roundup Ready seed, Bowman suspected that most of the grain elevator soybeans he purchased would carry the Roundup Ready trait.
He was right.
When Bowman planted the grain elevator soybeans and applied glyphosate to his fields most of the soybeans plants survived.
Bowman then saved seed from that crop of Roundup Ready beans for his second planting the next year, and Bowman repeated that process year after year for eight years.
So, he was able to produce eight crops a Roundup Ready soybeans all without buying any seed from Monsanto.
When Monsanto discovered this practice, it sued Bowman for patent infringement.
The question here is whether Bowman can defend against Monsanto suit based on what's called the ?doctrine of patent exhaustion.
Under that doctrine, the authorized sale of a patented article gives the purchaser or any subsequent owner like Bowman the right to use or resell that article without the patent holder's permission.
The District Court held a patented exhaustion did not protect Bowman's conduct and ordered him to pay damages to Monsanto.
The Federal Circuit affirmed.
We also agree.
We hold that patent exhaustion does not allow a farmer to reproduce patented seeds through planting and harvesting without the patent holders permission.
As I just explained, exhaustion prevents a patent holder from controlling the use or resale of a patented article after that article is sold.
The patent exhaustion has always been limited to the specific article sold.
It does not entitled the purchaser of a patented item to replicate that item at will.
That limit exists for a simple reason.
If anyone who bought a patented invention could make and sell new copies of that invention, then the patent would not be of much value.
That principle decides this case.