On May 13, 2013, the Supreme Court of the United States (SCOTUS) issued a unanimous decision in Bowman v. Monsanto Co. et al., holding that Vernon Bowman, an Indiana soybean farmer, violated the intellectual property rights of Monsanto. Significantly, the decision maintains harmony between U.S. and Canadian law regarding patent protection for self-replicating crops. For a full summary of the facts and issues please refer to our February 2013 Blakes Bulletin: Implications of U.S. Patent Seed Case for Canadian Agribusiness.
Mr. Bowman developed an unconventional practice that was the focus of the case. Unwilling to pay the premium price of Monsanto's patented "Roundup Ready" seeds for his "risky" late-season crop, Mr. Bowman purchased commodity soybeans intended for human and animal consumption from a local grain elevator. Anticipating that some had originated from local farmers using Roundup Ready soybeans, Mr. Bowman planted these soybeans in his field. Applying a glyphosate-based herbicide to eliminate all soybeans without the Roundup Ready trait, Mr. Bowman re-planted the surviving progeny to produce his late-season harvest in each of the next eight consecutive seasons. With no Technology Use Agreement in place to restrict Mr. Bowman's use of the soybeans purchased from the grain elevator, the case rested entirely upon whether Monsanto's patent rights were infringed by Mr. Bowman's subsequent use of the grain elevator-sourced soybean seeds.
SCOTUS was unconvinced by Mr. Bowman's primary argument that the common law doctrine of patent exhaustion exonerated him from liability. While the doctrine limits a patent holder's right to control another's use of a specific patented item after its authorized sale, it does not remove the patent holder's right to restrict an individual from making new copies of the item. SCOTUS stressed that finding Mr. Bowman's planting and harvesting of the grain elevator-sourced soybeans as falling under the protection of the patent exhaustion doctrine would undermine the rationale behind Monsanto's patent rights. Permitting such reproduction of the Roundup Ready soybeans would render Monsanto's patent rights of "scant benefit", since "other seed companies could reproduce the product and market it to growers, thus depriving Monsanto of its monopoly", and "[t]he grower could multiply his initial purchase . . . without compensating its inventor." Such an outcome "would result in less incentive for innovation than Congress wanted." Accordingly, the doctrine of patent exhaustion was ruled inapplicable, with Mr. Bowman held liable for patent infringement.
Bowman v. Monsanto Co. et al. is broadly consistent with Canadian jurisprudence on the subject of patented seeds. The Supreme Court of Canada case, Monsanto Canada Inc. v. Schmeiser, while not dealing specifically with the doctrine of patent exhaustion, similarly ruled that a farmer who deliberately saved and re-planted Roundup Ready canola seeds had violated Monsanto's patent rights. The result is a continuation of relative parity between the legal treatment of Canadian and U.S. farmers with regards to the use of patented genetically modified seeds.
Written with the contribution of Jordan Schubert, Student-at-Law