Law School Case Brief
Bowman v. Monsanto Co. - 569 U.S. 278, 133 S. Ct. 1761 (2013)
The patent exhaustion doctrine does not extend to the right to make a new product. Reproducing a patented article no doubt "uses" it after a fashion. But, the Supreme Court of the United States has always drawn the boundaries of the exhaustion doctrine to exclude that activity, so that the patentee retains an undiminished right to prohibit others from making the thing his patent protects. That is because, if simple copying were a protected use, a patent would plummet in value after the first sale of the first item containing the invention. The undiluted patent monopoly, it might be said, would extend not for 20 years (as the Patent Act promises), but for only one transaction. And that would result in less incentive for innovation than Congress wanted. Hence, exhaustion applies only to the particular item sold, and not to reproductions.
Respondent Monsanto Company invented and patented Roundup Ready soybean seeds, which contained a genetic alteration that allowed them to survive exposure to the herbicide glyphosate. It sold the seeds subject to a licensing agreement that permitted farmers to plant the purchased seed in one, and only one, growing season. Growers could consume or sell the resulting crops, but could not save any of the harvested soybeans for replanting. Petitioner Vernon Hugh 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 filed a lawsuit against Bowman in federal district court for patent infringement. Bowman raised the defense of patent exhaustion, which gave 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 awarded damages to Monsanto of $84,456. The court of appeals affirmed, reasoning that patent exhaustion did not protect Bowman because he had created a newly infringing article. Bowman was granted a writ of certiorari.
Could Bowman, who bought patented seeds, reproduce the seeds through planting and harvesting without permission from Monsanto, the patentee?
The Supreme Court of the United States affirmed the judgment of the court of appeals. The Court found that, under the patent exhaustion doctrine, Bowman could have: (1) resold the patented soybeans he purchased from the grain elevator, (2) consumed the beans himself, or (3) fed them to his animals. But the exhaustion doctrine did not enable Bowman to make additional patented soybeans without Monsanto's permission (either express or implied). After buying beans for a single harvest, Bowman saved enough seed each year to reduce or eliminate the need for additional purchases. Bowman planted Monsanto's patented soybeans solely to make and market replicas of them, thus depriving Monsanto of the reward patent law provided for the sale of each article. Because Bowman reproduced Monsanto's patented invention, the exhaustion doctrine did not protect him.
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