As previously reported, yesterday the U. S. Supreme Court
issued an opinion clarifying the doctrine of patent exhaustion. In Bowman
v. Monsanto Co. (lexis.com subscribers may access Supreme Court briefs and an enhanced version of the opinion for this case), a unanimous Court
held that patent rights were not exhausted in soybeans harvested from
genetically modified seeds sold by Monsanto.
Glyphosate is the active ingredient in several herbicides
used to kill weeds, including Monsanto's Roundup herbicide. Monsanto developed
genetically modified soybean seeds that can withstand exposure to glyphosate,
and markets these seeds as "Roundup Ready." Monsanto sells the Roundup Ready
seed only to purchasers who agree not to save any harvested seeds for
replanting in a subsequent growing season. Absent the agreement, a farmer could
harvest and replant glyphosate-resistant seeds because glyphosate resistance is
passed on from the planted seed to the harvested soy bean.
Monsanto received a number of patents relating to the
Roundup Ready technology, including two patents directed toward
The petitioner, Bowman, purchased harvested soybeans that
had been grown by other farmers using Roundup Ready seeds and sold to a grain
elevator. The seeds were intended for consumption and not replanting. Bowman
nonetheless planted these seeds in his fields and later harvested glyphosate-resistant
soybeans, which he continued to replant and harvest over the course of the next
eight years. After discovering this practice, Monsanto sued Bowman for patent
Bowman raised the defense of patent exhaustion, asserting
that Monsanto could not control his use of the soybeans because they were the
subject of a prior authorized sale. The district court rejected this argument
and awarded damages to Monsanto. On appeal, the Federal Circuit held that
patent exhaustion did not protect Bowman because he had "created a newly
infringing article" rather than use an article sold by Monsanto. The Federal
Circuit further explained that the right to use a patented article "does not
include the right to construct an essentially new article on the template of
the original." The Supreme Court granted certiorari on the issue of
The Court began by explaining that the doctrine of patent
exhaustion limits a patentee's right to control what others can do with an
article embodying or containing an invention. Under the doctrine, "the initial
authorized sale of a patented item terminates all patent rights to that item."
The doctrine, however, "restricts a patentee's rights only as to the
'particular article sold; it leaves untouched the patentee's ability to prevent
a buyer from making new copies of the patented item." For example, observed the
Court, "the purchaser of the patented machine . . . does not acquire any right
to construct another machine either for his own use or to be vended to another.
. . . That is because the patent holder has 'received his reward' only for the
actual article sold and not for subsequent recreations of it. . . . If the
purchaser of that article could make and sell endless copies, the patent would
effectively protect the invention for just a single sale."
Based on this analysis, the Court held that the harvested
soybeans did not constitute the actual article sold by Monsanto, and rejected
Bowman's arguments of patent exhaustion. The Court observed that Bowman could
resell the patented soybeans he purchased, could consume the beans himself, or
could feed them to his animals. "But," held the Court, "the exhaustion doctrine
does not enable Bowman to make additional patented soybeans without
Monsanto's permission (either express or implied)." The Court also held that
this conclusion applied irrespective of how Bowman had acquired the seeds.
Bowman then asserted that because the seeds naturally
self-replicate or "sprout" unless stored in a controlled manner, it was the
planted soybean, and not Bowman "that made replicas of Monsanto's patented
invention." The Court stated that the "blame-the-bean defense" was "tough to
credit." It noted that Bowman was not a passive observer, and that eight
successive soybean crops did not happen on their own. Bowman purchased the
seeds from the grain elevator, planted the seeds, tended and treated them, and
also harvested them. "In all this, the bean surely figured. But it was Bowman,
and not the bean, who controlled the reproduction (unto the eighth generation)
of Monsanto's patented invention."
The Court stated that its opinion was "limited-addressing
the situation before us, rather than every one involving a self replicating
product." The Court also recognized that related inventions were becoming "ever
more prevalent, complex, and diverse" and that other situations might resolve
differently. Nonetheless, the Bowman decision provides some
clarification of the doctrine of patent exhaustion.
For more information on this decision, please contact
Fitch Even partner Eric
L. Broxterman, the author of this alert.
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