Update - Patent Infringement by Farmers Planting the Progeny of Genetically Altered Seeds Covered by U.S. Patents

The US Supreme Court in a unanimous decision in the case, titled "Bowman vs. Monsanto et al," ruled  that  Patent exhaustion does not permit a farmer to reproduce patented seeds through planting and harvesting without the patent holder’s permission.

Find Out More

• Supreme Court decision 11-796  (.pdf)

• News Release- "Supreme Court Ruling Supports Breakthrough 21st Century Technologies, Ensures That Patent Law Will Protect Continued Advancement In Agriculture Products"

• Science Insider News -"U.S. Supreme Court Upholds Monsanto Soybean Patents, Rejects Blame-the-Bean Defense"

• The Washington Post News Story- "Supreme Court rules for Monsanto in genetically modified soybean case"

• Reuters News Story -"UPDATE 2-U.S. Supreme Court rules for Monsanto in patent fight"

The text of the summary of the unanimous Supreme Court decision follows :

No. 11–796. Argued February 19, 2013—Decided May 13, 2013

Respondent Monsanto invented and patented Roundup Ready soybean seeds, which contain a genetic alteration that allows them to survive exposure to the herbicide glyphosate. It sells the seeds subject to a licensing agreement that permits farmers to plant the purchased seed in one, and only one, growing season. Growers may consume or sell the resulting crops, but may not save any of the harvested soybeans for replanting. Petitioner Bowman purchased Roundup Ready soybean seed for his first crop of each growing season from a company associated with Monsanto and followed the terms of the licensing agreement. But to reduce costs for his riskier late-season planting, Bowman purchased soybeans intended for consumption from a grain elevator; planted them; treated the plants with glyphosate, killing all plants without the Roundup Ready trait; harvested the resulting soybeans that contained that trait; and saved some of these harvested seeds to use in his late-season planting the next season. After discovering this practice, Monsanto sued Bowman for patent infringement. Bowman raised the defense of patent exhaustion, which gives the purchaser of a patented article, or any subsequent owner, the right to use or resell that article. The District Court rejected Bowman’s defense and the Federal Circuit affirmed.

Held: Patent exhaustion does not permit a farmer to reproduce patented seeds through planting and harvesting without the patent holder’s permission. Pp. 4–10.

(a) Under the patent exhaustion doctrine, “the initial authorized sale of a patented article terminates all patent rights to that item,” Quanta Computer, Inc. v. LG Electronics, Inc., 553 U. S. 617, 625, and confers on the purchaser, or any subsequent owner, “the right to use [or] sell” the thing as he sees fit, United States v. Univis Lens Co 316 U. S. 241, 249–250. However, the doctrine restricts the patentee’s rights only as to the “particular article” sold, id., at 251; it leaves untouched the patentee’s ability to prevent a buyer from making new copies of the patented item. By planting and harvesting Monsanto’s patented seeds, Bowman made additional copies of Monsanto’s patented invention, and his conduct thus falls outside the protections of patent exhaustion. Were this otherwise, Monsanto’s patent would provide scant benefit. After Monsanto sold its first seed, other seed companies could produce the patented seed to compete with Monsanto, and farmers would need to buy seed only once. Pp. 4–7.

(b) Bowman argues that exhaustion should apply here because he is using seeds in the normal way farmers do, and thus allowing Monsanto to interfere with that use would create an impermissible exception to the exhaustion doctrine for patented seeds. But it is really Bowman who is asking for an exception to the well-settled rule that exhaustion does not extend to the right to make new copies of the patented item. If Bowman was granted that exception, patents on seeds would retain little value. Further, applying the normal rule will allow farmers to make effective use of patented seeds. Bowman, who purchased seeds intended for consumption, stands in a peculiarly poor position to argue that he cannot make effective use of his soybeans. Bowman conceded that he knew of no other farmer who planted soybeans bought from a grain elevator. In the more ordinary case, when a farmer purchases Roundup Ready seed from Monsanto or an affiliate, he will be able to plant it in accordance with Monsanto’s license to make one crop. Pp. 7–10.

657 F. 3d 1341, affirmed.

KAGAN, J., delivered the opinion for a unanimous Court.