Source: http://www.jdsupra.com/post/documentViewer.aspx?fid=df89d004-d8f5-4b69-bc7f-0cba2ad31ddd
Timestamp: 2013-05-24 16:06:12
Document Index: 448168265

Matched Legal Cases: ['§ 2321', '§ 271', '§ 2543', '§ 117', '§ 283', '§ 271', '§ 106']

Government Sticks to Its Guns in Bowman v. Monsanto Amicus Brief | McDonnell Boehnen Hulbert & Berghoff LLP - JDSupra
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Over the past decade, the Supreme Court's increased interest in patent law cases was paralleled by briefs from the Solicitor General advising the Court to grant certiorari. The apparent influence of the government has waned in recent years, beginning with the Court's grant of certiorari in Laboratory Corp. v. Metabolite Labs., Inc. ("LabCorp") against the SG's advice, and accelerating during the Obama Administration where the Court has expressly rejected the government's position (Stanford v. Roche; Mayo v. Prometheus). Most recently, the Court also ignored the SG's opinion not to grant certiorari in Bowman v Monsanto (see "Solicitor General Recommends the Supreme Court Deny Cert in Bowman v. Monsanto"). Regardless, the government has filed an amicus brief, at the Court's invitation, that reiterates many of the arguments the government urged in its CVSG brief.
The amicus brief is endorsed by both the Department of Justice and the U.S. Patent and Trademark Office (in marked contrast to the government's ill-considered amicus briefs to the Federal Circuit in AMP v. Myriad). Indeed, in its Statement of Interest, the brief asserts that the government's interest is the PTO's interest, due to its role of "issuing patents and advising the President on issues of patent policy." The brief characterizes the Question Presented as:
Whether the authorized sale of one generation of a patented plant seed exhausts a patentee's right to control subsequent generations of that seed.
Which modifies Farmer Bowman's Question, which begged the question it purportedly asked (see "Supreme Court Grants Certiorari in Monsanto v. Bowman"). The government's brief makes four arguments:
• Monsanto's patent right to "make" recombinant, Roundup-Ready® soybeans was not exhausted in sales of commodity seed
• Statutory (the Plant Variety Protection Act) and judicial (J.E.M. Ag Supply, Inc. v. Pioneer Hi-Bred International, Inc., 534 U.S. 124 (2001)) authority supports the argument that Monsanto's rights were not exhausted
• Farmer Bowman's additional arguments "are not persuasive" and can be summarily addressed (and rejected)
• While the Federal Circuit's "conditioned sales" doctrine is inconsistent with the Court's decision in Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S. 617, 625-28 (2008), the appellate court did not base its decision here on the discredited doctrine.
The brief's first argument urges that affirming the Federal Circuit is consistent with, not contradictory to, the Court's patent exhaustion doctrines. Citing a multitude of cases from the 19th and 20th Centuries, as well as Quanta, the brief repeatedly emphasizes that the Court should consider that exhaustion is limited to sale of a particular article ("that article") and does not extend to making an additional article. Specifically, the brief cites United States v. Univis Lens Co., 316 U. S. 241 (1942) (the intellectual forebear of the Court's Quanta decision) in support of its position:
As the Court explained in Univis, "the purpose of the patent law is fulfilled with respect to any particular article when the patentee has received his reward for the use of his invention by the sale of the article," and "once that purpose is realized the patent law affords no basis for restraining the use and enjoyment of the thing sold."
Citing the Court's "repair/reconstruction" dichotomy, the brief asserts that the relevant precedent requires that "[a] patentee 'cannot prevent those to whom he sells from . . . reconditioning articles worn by use,' but it can prevent them from 'in fact mak[ing] a new article,'" citing Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336,343 (1961), and other authorities including Wilbur-Ellis Co. v. Kuther, 377 U.S. 422, 424 (1964); Cotton-Tie Co. v. Simmons, 106 U.S. 89, 93-94 (1882); Wilson v. Simpson, 50 U.S. (9 How.) 109, 123-125 (1850); Jazz Photo Corp. v. International Trade Comm'n, 264 F.3d 1094, 1102 (Fed. Cir. 2001), cert. denied, 536 U.S. 950 (2002); and United States v. Aluminum Co. of Am., 148 F.2d 416, 425 (2d Cir. 1945)). Based on these authorities, the brief states that "the authorized sale of first-generation soybean seed exhausts the patentee's rights to control the use and disposition of that seed" and none other.
This conclusion is reinforced, according to the brief, by decisions by the Court and Congress evincing intentions contrary to Farmer Bowman's position. Congressional intent in this regard is illustrated by the Plant Variety Protection Act (PVPA), Pub. L. No. 91-577, 84 Stat. 1542 (7 U.S.C. § 2321 et seq.), and specifically those provisions of the Act that permit (limited) seed-saving and replanting of saved seed. As the Court recognized in J.E.M. AG Supply, the PVPA differs from the Patent Act in providing that:
[I]t shall not infringe any right [under the PVPA] for a person to save seed produced by the person from seed obtained, or descended from seed obtained, by authority of the owner of the variety for seeding purposes and use such saved seed in the production of a crop for use on the farm of the person, or for sale as provided in this section.
The Court in J.E.M. AG Supply recognized that plants are entitled to utility patent protection and that the "seed-saving" provisions of the PVPA were not included in the Patent Act, thus creating infringement liability under 35 US.C. § 271 for patented seed that did not arise for seed protected under the PVPA. 534 U.S. at 143. But even these rights under the PVPA are not unlimited, being restricted to "sales only 'for other than reproductive purposes,' i.e., for purposes other than replanting," citing 7 U.S.C. § 2543; and Asgrow Seed Co. v. Winterboer, 513 U.S. 179, 184 n.2 (1995). This precedent supports the government's view that Farmer Bowman's infringing activities were not absolved by patent exhaustion.
The brief also notes Congressional intent by the absence of legislation, contrasting the instant case with software copyright, where Congress has created an exemption for copying. Specifically, the brief references the "essential step defense" which provides that "it is not an infringement for the owner of a copy of a computer program to make or authorize the making of another copy or adaption of that computer program" as specified. 17 U.S.C. § 117(a)). Congress clearly understands that there are circumstances where it should act to prevent overreaching of exclusive rights under the Copyright and Patent Clause, and notes that the Court has recognized the primacy of the role of Congress in making these policy decisions, citing Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 458-459 (2007), and Diamond v. Chakrabarty, 447 U.S. 303, 305, 318 (1980).
The government includes in this section of the brief the potential for a contrary decision by the Court for consequences "not limited to genetically modified crops," including "enforcement of patents for man-made cell lines, DNA molecules, some nanotechnologies, and other technologies that involve self-replicating features." These consequences would be visited on the numerous companies [that] have marketed patented recombinant plasmids and transformed cell lines capable of replication with limited human intervention" rendered patentable under the Court's Chakrabarty decision. "These patents would lose much of their value if purchasers of patented bacteria or other self-replicating products could reproduce and sell those items free from the restraints of patent law," according to the government. Finally, the brief rejects Farmer Bowman's argument that contractual remedies are sufficient, because "[c]ontractual remedies are ineffective against downstream purchasers not in privity with the patent holder. . . [a]nd patent law provides remedies unavailable under contract law, including injunctive relief and enhanced damages," citing 35 U.S.C. §§ 283-285.
The brief summarily dismisses Farmer Bowman's other arguments. This includes Bowman's "fundamental misunderstanding" of Quanta, which the government argues is an attempt to graft Quanta's principles of patent exhaustion to method claims onto composition of matter claims (the Court's analysis in Quanta "is not easily applied to patents on "manufacture[s]" or "composition[s] of matter"). The brief further argues that "[n]othing in [the] Quanta [decision] casts doubt on the proposition that ". . . the general rule [of patent exhaustion] has always been subject to an important qualification: even the lawful owner of a patented article may not, without authorization, use it to make a new copy of the patented article." Second, the brief argues that planting is not the "only reasonable and intended use" of the commodity soybeans at issue here and thus this case can be distinguished from the Court's concerns in Quanta.
Turning to Farmer Bowman's argument that replanting seed and recreating soybeans is not reconstruction of the patentees article, the brief states that while this statement is true it is "irrelevant" because "[u]nauthorized reconstruction is an act of infringement because it implicates a patent holder's exclusive right to "make" the patented invention," citing Wilbur-Ellis, 377 U.S. at 424. Contrary to Farmer Bowman's argument, the Court's "reconstruction" cases are relevant to the issue before the Court because those cases "exemplif[y] a critical qualification to the exhaustion doctrine -- that, absent an express or implied license, the authorized sale of an article embodying a patented invention does not give the purchaser the right to make a new patented article." The brief similarly dismisses Farmer Bowman's reliance on Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518 (1972), because that case (standing for an "unremarkable proposition") absolves from infringement someone who makes fewer than all the claimed elements of a claimed invention, whereas here Farmer Bowman's "activities culminated, and were intended to culminate, in the creation of the final patented product in the United States."
(In an illuminating footnote, the brief addresses amici arguments regarding "unintentional" infringement by "organic" farmers and others, stating "[t]he speculative possibility that respondent could sue a truly inadvertent infringer for patent infringement provides no sound basis for a wholesale expansion of the patent-exhaustion doctrine to include the deliberate unauthorized 'mak[ing]' of self-replicating technologies.")
Finally in this section of the brief the government responds to Farmer Bowman's various arguments relating to the distinction between "use" and "make" in § 271(a). The brief cites provisions of the Copyright Act relating to the exclusive right of copyright holders to "reproduce" copyrighted works, 17 U.S.C. § 106(1), and rejects Farmer Bowman's argument that affirming the Federal Circuit would vitiate statutory provisions relating to "indirect" infringement. The brief states that "petitioner appears to equate the dictionary definition of "make" with a but-for causation standard for direct infringement, under which any person who performs an act that ultimately leads to the creation of a patented invention 'makes' that invention. Petitioner fails to recognize that cases of direct infringement -- unlike indirect infringement -- do not require the intervening act of another person."
The brief in its last section turns to the Federal Circuit's "conditional sale" doctrine, agreeing with Farmer Bowman that the Supreme Court's Quanta decision discredited the line of cases, starting with Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 976 F.2d 700, 706-08 (1992), that followed this reasoning. The government's brief does note, however, that the Quanta decision did not "explicitly overrule" these cases, just that the Court's decision "repeatedly describe[d] the patent-exhaustion doctrine in terms that leave little room for enforcement through patent law of post-sale restrictions on use or resale." Regardless, because the Federal Circuit did not base its decision on the conditioned sale doctrine, the vitality vel non of that doctrine was neither dispositive nor at issue here.
Topics: Genetically Engineered Seed, Infringement, Monsanto, Patents, SCOTUS, Seed Set
Published In: Agriculture Updates, Intellectual Property Updates