Today, the U.S. Supreme court has issued a unanimous opinion in favor of Monsanto Company, an agricultural biotech giant, who sued Vernon Hugh Bowman, an Indiana farmer, for patent infringement. Monsanto holds a patent for a genetically engineered soybean capable of surviving exposure to herbicides, including Monsanto's own popular Roundup® (Monsanto cleverly commercialized the patented soybeans under the trademark Roundup Ready®). Upon purchasing the Roundup Ready® seeds, the farmers are required to sign an agreement legally obligating them against replanting harvested soybeans, therefore, forcing them to purchase new Roundup Ready® seeds each season, ensuring repeat business for Monsanto.
Bowman devised an interesting plan to exploit what he thought was a loophole. Instead of buying Roundup Ready® seeds from a Monsanto distributer, Bowman purchased soybeans that were sold as animal feed, figuring that at least some of those soybeans came from a Roundup Ready® plant. Bowman planted the soybeans and sprayed them with herbicide—as expected, some of the plants survived and yielded more seeds with the herbicide resistant trait. Since Bowman did not purchase Roundup Ready® seeds directly, he was under no contractual obligation prohibiting him from replanting the seeds which he has harvested.
Monsanto learned of Bowman's actions and filed a patent infringement lawsuit against him for producing patented seeds without Monsanto's authorization. In his defense, Bowman relied on the doctrine of patent exhaustion, which provides that once ownership of a patented article is legally obtained, the owner of the article may do what he wishes with the acquired article. Bowman argued that since he has legally purchased the soybeans, he could replant them without facing any legal repercussions. The unanimous Supreme Court disagreed, unequivocally holding that patent exhaustion is limited to a particular article and does not allow for an unauthorized production of additional patented articles. Bowman was found liable for patent infringement and was ordered to pay $84,456 to Monsanto in damages.