WIN FOR MONSANTO: PATENT EXHAUSTION DOES NOT NECESSARILY APPLY TO SELF-REPLICATING ITEMS

This week, the U.S. Supreme Court ruled – unanimously – that Monsanto’s patent for soybeans was infringed by Indiana farmer Vernon Bowman. Even though expressly called out as limited to this case and potentially not applicable to other self-replicating technology, it bodes well for the patent community.

In this case, Monsanto holds a patent on a strain of soybeans engineered to resist RoundUp®, another Monsanto product. Farmers may purchase these soybeans, signing a contract agreeing not to reuse the soybeans or its byproducts. Therefore, each year farmers must buy seeds from Monsanto. Bowman sought an end-run around this arrangement by purchasing seeds from a grain elevator, reasoning it likely contained the patented soybeans. He planted the seeds, sprayed with RoundUp®, and replanting the resulting offspring, thereby selecting for the patented soybeans.

Bowman argued that the doctrine of patent exhaustion allowed him to do this, since he purchased the original seed. The U.S. Supreme Court stated that while patent exhaustion does permit the purchaser of a patented product to do with that product as s/he will, including resale, it does not permit the making of another patented item. This is precisely what Bowman was doing. They also rejected his argument that the self-replicating nature of the soybeans removes his culpability…the beans may have been doing what they naturally do by sprouting and growing, but Bowman was taking advantage of this property to obtain additional patented items, which is prohibited.

 

The full opinion can be found here (Bowman v. Monsanto Company, No. 11-796)