Patent World Waits for Monsanto Ruling

The United States Supreme Court recently heard oral arguments in a key patent case involving so-called “self-replicating” products.  Monsanto Company is a Saint Louis-based business that develops agricultural technology.  One of its products is a genetically engineered soybean that is resistant to weed killer.  Monsanto requires farmers who purchase such soybeans from it to promise that that they will not use any of the harvested first-generation seeds for future planting.  The case before the Supreme Court involves an Indiana farmer, Vernon Bowman, who purchased soybean seeds from Monsanto and signed Monsanto’s licensing agreement.  Later, the farmer purchased seeds from a local grain elevator with the intent of raising a second harvest.  The seeds were cheaper than the ones he purchased through Monsanto, but Bowman suspected that at least some of the purchased seeds might be derived from the Monsanto variety.  Sure enough, the soybeans from the second set of seeds were resistant to weed killers.  Monsanto argued that Bowman had violated its patent.  Bowman responded that the doctrine of “patent exhaustion” protected him; under this principle of patent law, a patent holder has no control over a product once it is sold by the initial purchaser in a permissible sale.  Monsanto’s counter is that patent exhaustion has limited applicability to self-replicating technology such as seeds.

Monsanto’s position that its patent extends to second-generation seeds is relevant to many industries that also use self-replicating technology, such as certain DNA molecules.  The Obama administration, several universities, and various businesses have backed Monsanto by filing amicus briefs with the Supreme Court.  During oral argument, the Supreme Court justices were critical of Bowman’s position and made it clear that that allowing patents to be easily circumvented would discourage innovation.  A decision is expected later this spring or early summer.