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February 5, 2008

Bad Seed

Dakota farmer Loren David tried to cheat Monsanto by saving and replanting patented soybean seeds, a breach of contract as well as patent infringement. Monsanto caught him, and it's going to cost David in the neighborhood of $700,000.

Monsanto v. Loren David (CAFC 2007-1104)

5,352,605, the patent at issue, claims a gene sequencing to render plants immune to the deadly effects of Monsanto's pesticide.

Monsanto has developed Roundup Ready® Technology, which involves inserting a chimeric gene into a seed that allows the plant to advantageously continue to break down sugars in the presence of glyphosate. Crops grown from such seeds are resistant to Roundup® and other glyphosate-based herbicides. When Roundup Ready® seeds are planted and used in conjunction with a glyphosate-based herbicide, Roundup Ready® plants will survive, while weeds and other plants lacking the Roundup Ready® gene will be killed. Monsanto has claimed this technology in the '605 patent.

Monsanto developed a holistic commercial regime for its patented seeds.

Monsanto licenses seed companies to incorporate the Roundup Ready® genes into their plants and to sell soybean seeds containing the Roundup Ready® gene. All purchasers of such seeds are required to enter into a Technology Agreement that grants them the right to use the seeds. The Technology Agreement stipulates that buyers may use the seeds for the planting of only a single commercial crop, but that no seeds from that crop may be saved for future harvests. The Technology Agreement assures Monsanto that farmers must purchase new Roundup Ready® seeds each harvesting season, rather than simply saving seeds from the prior year's harvest, as they normally would with conventional soybean seeds. Monsanto also charges a Technology Fee for each unit of Roundup Ready® soybean seeds sold.1 The Technology Agreement also contains a clause granting Monsanto the full amount of its legal fees and other costs that may have to be expended in enforcing the agreement.

David bought into Monsanto's scheme, then plowed afoul by replanting seeds.

At some time in 2003, Monsanto began to suspect that David had saved soybean seed from his previous year's harvest in violation of the Technology Agreement. In April 2004, after David's 2003 crop had already been harvested and sold, Monsanto obtained samples of the soybean plant material remaining from some of David's fields. On the basis of those tests, on April 12, 2004, Monsanto filed suit for patent infringement, breach of contract, unjust enrichment, and conversion, alleging that David had illicitly saved and planted Roundup Ready® seeds.

David tried to cover it up. Monsanto sussed him out.

A bench trial was held in February 2006 during which Monsanto presented crop insurance records with planting dates provided by David. In those records, David claimed to have planted nearly all of his soybean fields as of May 6, 2003. Monsanto also presented an invoice from Red River Grain for David's purchase of 993 units of Roundup Ready® soybean seed on May 31, 2003, nearly a month after David claimed to have planted the vast majority of his soybean crop for the year. Monsanto argued that that purchase was merely David's attempt to convince Monsanto that he had purchased enough Roundup Ready® seed to plant his crops and that he had not saved any seed.

David lied. The CAFC was disgusted.

David's real complaint seems to be that he should be able to save seed from his harvest, regardless of Monsanto's patent. We have dealt with this complaint before. See e.g. Monsanto Co. v. McFarling, 302 F.3d 1291 (Fed. Cir. 2002).

David does not dispute that he planted Roundup Ready® soybean seeds in 2003; rather, he claims that the Roundup Ready® seeds that he planted were acquired from authorized dealers. To dispute this claim, Monsanto presented scientific field tests demonstrating that David's soybean fields had been planted exclusively with Roundup Ready® soybeans, invoices proving that David had purchased large quantities of glyphosate-based herbicides, government documents of David's planting dates, and evidence that David had not purchased enough Roundup Ready® seeds to fully plant his fields by those dates. In response, David offered inconsistent testimony regarding what he actually planted in 2003. David, 448 F. Supp. 2d at 1092. David changed his version of events at least three times, including claiming that he planted only the perimeters of his fields with Roundup Ready® seed, while planting the interior of his fields with conventional seed. Id. David's testimony, and that of his daughter, was the only evidence offered to refute Monsanto's case. Due to his continually changing testimony, the court disregarded much of David's testimony. See id.

The district court awards damages based upon reasonable royalty, attorneys' fees, and costs. The appeals court found fault with the royalty calculation based upon planting density, so remanded for further calculation.

David had tilted at invalidity by § 101, but the CAFC would have none of it.

David's brief makes much of the Supreme Court's decision in J.E.M. Ag Supply, Inc. v. Pioneer Hi-Bred International, Inc., 534 U.S. 124 (2001). J.E.M. involved utility patents issued for corn seed products... Nothing in J.E.M. invalidates or limits the '605 patent or any utility patent on a gene sequence in a seed or a plant. In fact, in J.E.M., the Supreme Court explicitly refused to limit the extent of patentable subject matter: "we decline to narrow the reach of § 101 where Congress has given us no indication that it intends this result." J.E.M., 534 U.S. at 146-47. The '605 patent covering the gene sequence is infringed by planting a seed containing the gene sequence because the seed contains the gene. The gene itself is being used in the planting, an infringing act.

Posted by Patent Hawk at February 5, 2008 11:03 PM | Litigation

Comments

It's not nice to play with Mother Nature, I mean, Monsanto. I'm not so sure it's a good idea to have to pay a company to plant seeds each year. We would not be where we are as a civilization without being able to replant crops with seeds from the last year. Thank you for your coverage of this issue.

Posted by: Anthony Kuhn at February 6, 2008 2:36 PM

This David suit brings to mind Einstein's expression that "doing the same thing over and over again and expecting a different result is insanity." The Federal Circuit for one is obviously losing patience (and willing to award attorneys fees and costs to Monsanto) over the continuing effort to test Monsanto's Round Up Ready technology and associated Technology License.

Posted by: EG at February 6, 2008 3:30 PM

Monsanto has sued, harrassed and intimidated many thousands of farmers. Davids case is only a small exp. of at what lenghs Monsanto goes to set an example by spending $500,000 + on attorney bills. Anyone using there products are subject to the same harrassment. This case is probably far from over.

Posted by: Ken Lyons at February 28, 2008 6:51 PM

Any farmer out there go to Center for Food Safety to get a glimpse of lawsuits by Monsanto. David undoubtably did nothing wrong and was a victum of Monsanto's cruel tactics.

Posted by: Conserned Farmer at February 28, 2008 7:01 PM

Stop Monsanto by not buying their products. This company is the most evil on planet earth, stay away from them. if you only knew how evil they really are everyone would stop buying their products and put an end to their company.

Posted by: Rex Kittle at August 6, 2009 11:51 AM

"David's real complaint seems to be that he should be able to save seed from his harvest, regardless of Monsanto's patent. We have dealt with this complaint before. See e.g. Monsanto Co. v. McFarling, 302 F.3d 1291 (Fed. Cir. 2002)."

First sale doctrine should rule in these cases it seems to me like. It's a straightforward case of the man using the exact same thing as he bought. A plant that goes through life cycles.

Posted by: 6000 at August 6, 2009 12:20 PM

"First sale doctrine should rule in these cases it seems to me like."

You obviously have no idea what the first sale doctrine is.

I'm going to have to upgrade your understanding of the law to off-the-charts mediocre.

Posted by: don't bother at August 6, 2009 12:35 PM