On May 13, 2013, the Supreme Court confirmed that a purchaser or subsequent owner of a patented article is not allowed to make new copies of the patented invention. The theory of patent exhaustion is not a defense. In Bowman vs Monsanto, Monsanto invented a genetically modified soybean resistant to the application of common herbicides, such as Monsanto’s own Roundup product. The patented soybean seed was marketed as a “Roundup Ready” seed.
Monsanto sells the patented soybean seeds using special licensing agreements. Purchasers/farmers are allowed to plant the purchased seeds in only one season. The resulting crop is either consumed or sold as a commodity. The agreement specifically forbids a farmer from saving harvested soybeans for replanting, or supplying them to anyone else for that purpose. Monsanto sought to prevent a farmer from purchasing their genetically modified soybeans, planting them in year one of the agreement, and then using the harvested soybeans for the next crop.
Mr. Vernon Bowman, a farmer in Indiana, tried to creatively circumvent Monsanto’s agreements with farmers. For his first harvest, Mr. Bowman purchased seeds from Monsanto under the special licensing agreement. He sold or consumed the harvest, as required by Monsanto’s agreement. For the second harvest, however, Mr. Bowman chose not to pay the premium price charged by Monsanto. Instead, he purchased “commodity soybeans” from a grain elevator intended for human/animal consumption. The soybeans came from local farmers, most of which used the Monsanto “Roundup Ready” seed. Since the soybeans were harvested from Monsanto seeds, they carried the same genetic resistance to herbicides. Mr. Bowman saved a portion of the resulting crop for subsequent harvests, essentially becoming self-sufficient. Not surprisingly, Monsanto sued Mr. Bowman for patent infringement.
Mr. Bowman raised patent exhaustion as a defense to infringement. Under the doctrine of patent exhaustion, the first authorized sale of a patented item terminates all subsequent patent rights for that item. Since the patent holder received a reward by selling their protected article, the purchaser has the right to use or sell the item as he pleases. But the doctrine does not allow a buyer from making new copies of the patented article. If the contrary were true, a patent monopoly would last for one sale, not 20 years (14 for a design patent). Accordingly, Mr. Bowman could have sold or consumed the beans he bought from the grain elevator but he could not make additional copies of the patented soybeans without Monsanto’s permission.
Finding humor in a Supreme Court decision is not particularly common. Mr. Bowman argued, likely as a last resort, that beans naturally “self-replicate” or sprout if they are not stored in a controlled manner. He stated that the planted soybeans, not Mr. Bowman himself, were the real culprit that replicated Monsanto’s patent invention. The blame-the-bean defense. The Supreme Court articulately described how Mr. Bowman, not the seeds, purchased the beans, planted the “Roundup Ready” beans, treated them, and harvested them. Mr. Bowman controlled the seeds’ reproduction throughout the process. Accordingly, the Supreme Court affirmed the Federal Circuit’s decision that Mr. Bowman infringed Monsanto’s patented soybeans.
For more information about this case, Intellectual Property Litigation, or the prosecution of patents and trademarks with the United States Patent and Trademark Office (USPTO), please feel free to contact me.
Greg M. Popowitz
Registered Patent Attorney
Intellectual Property Litigation
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