View from the Levee: Monsanto’s Seeds

A 75-year-old bachelor farmer takes on agriculture giant Monsanto in the Supreme Court. From the justices’ questions at oral arguments, it sounds like the Supremes want to protect monopolies, not competition.

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Attorney Mark Walters was exactly 98 words into his initial argument to the U.S. Supreme Court Feb. 19 when Chief Justice John Roberts interrupted to verbally grab him by an ear and march him to the edge of a legal cliff.

“Why in the world would anyone,” asked Roberts, “spend any money to improve the seed if as soon as they sold the first one anybody could grow more and have as many of those seeds as they want?”

Roberts’ question was the beating heart of Bowman v. Monsanto Co., the case before the Court: Did patented, self-replicating technologies—like Monsanto’s market-dominating Roundup Ready seeds—lose patent protection in subsequent, self-replicated generations?

Vernon Bowman, a 75-year-old bachelor farmer from southern Indiana, thought so, at least for the soybeans he bought from a local elevator and planted on his farm.

In fact, argued Walters, Bowman’s attorney, the purchase of the soybeans from an elevator to use as seed was legal because Monsanto’s “first use rights” in its patent were “exhausted” by the elevator’s intention to use the soybeans for “commercial” purposes, like animal feed.

Golly, wondered Roberts, if that theory holds why would any firm risk any investment to develop any new technology?

Walters didn’t hesitate to reply; he should have: “I agree,” he said, “no one would do that….”

And just like that—less than one minute into what would be a 70-minute hearing—the biggest test of Monsanto’s cast iron grip on the global ag seed market crumbled.

(The complete transcript is available here.)

Photo by Reuters
Mark Walters, left, Bowman’s attorney, talks to the press after the hearing. The justices stopped him 98 words into his oral argument.

Other justices—Kennedy, Sotomayer, Scalia, Breyer, Ginsburg and Kagan—all caught the Chief’s line of questioning and, soon, they were too were pounding Walters. Their questions came so fast and so relentlessly that his key legal point, patent exhaustion, soon sounded like a clever conceit.

It wasn’t.

The argument Walters was quickly failing to make might have been novel but it wasn’t so off-the-wall that the Supreme Court was willing to let two lower courts rulings on it—both against his client, Bowman—stand without review.

These big hitters wanted a whack at it, too, because today’s fast-expanding universe of technology was quickly outpacing yesterday’s patent laws. Clarification was needed.

The key question was, Did 120-year-old patent law and the intellectual property rights it bestowed on inventors cover subsequent generations of the technology if it replicated like, say, vaccines, software and seeds?

Bowman, through attorney Walters, believed the old laws—under current application—did not offer protection. One-and-done, was their argument.

Monsanto, whose seed patents give the St. Louis-based firm a virtual grip on key food and fiber crops from Indiana to India, thought otherwise.

Subsequent generations of the patented seed, its attorney argued, carry the very item first patented, the germplasm that makes the crop “Roundup Ready.” As such and by extension any—every—generation thereafter would be covered by the initial patent.

The Monsanto view, however, carries a big problem: For that construction to be correct, courts need to “expand” yesterday’s old laws to fit today’s new times. Two federal courts, in Indiana and the Federal District in Washington, D.C., have done just that.

But it’s just not patent expansion, explained Peter Carstensen, a law professor at the University of Wisconsin and co-author of a “friend of the court” brief that favored Bowman’s view; it’s also antitrust issues.

“Patent law and antitrust law pose an inherent tension,” Carstensen’s brief explained. “One facilitates monopoly and limits competition and the other facilitates competition and limits monopoly.”

Photo by Glen Stubbe/ZUMA Press
The seeds in question: Roundup Ready soybeans, patented by agriculture giant Monsanto.

How the Supreme Court rules will do the same. Affirming the lower courts will favor Monsanto’s monopoly over competitors. Overturning the lower courts will favor competitors to challenge Monsanto’s monopoly.

Based on justices’ questions, most court watchers predict the Supremes will affirm the lower courts’ decisions and greatly expand patent rights. If so, that almost certainly ensures Monsanto’s continued domination of the global corn, soybean and cotton seed markets for years to come.

Moreover, an affirming opinion also gives Monsanto hundreds of billions of reasons to promote other patented seed lines, like wheat, rice and barley, for widespread use around the world.

A ruling is expected by June.

Alan Guebert is an Illinois-based agriculture writer who can be contacted at [email protected]

 

 

Topics: Ag and Trade
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