Farmers battle Monsanto over use of 2nd-generation patented soybeans

WASHINGTON - The Scruggs brothers of Tupelo, Miss., have been battling Monsanto Co. over use of its patented, genetically modified soybeans for more than 12 years. They've lost at the federal district court level in Oxford and on appeal.

But a case before the U.S. Supreme Court Tuesday gives them hope.

The court heard oral arguments in an appeal of a remarkably similar case involving a Monsanto patent infringement case against Indiana farmer Vernon Hugh Bowman involving the same patented soybeans.

That gives the brothers hope that their re-planting of second and subsequent generations of bio-engineered seeds does not violate the agribusiness giant's patent rights.

A final judgment in the Scruggs case, which resulted in a jury verdict of "willful" infringement of the patent in September 2010 and $8.9 million in damages for Monsanto, is stayed pending outcome of the Indiana case. Monsanto is asking for additional damages because of the willful character of the offense.

The genetic modification built into the Monsanto soybean seeds makes them able to withstand use of the company's Roundup weed killer, which the company's court brief says it has invested "hundreds of millions of dollars" to produce. Critics of the technology and the legal agreements required to use it say it gives Monsanto a monopoly and has led to higher seed prices.

Monsanto contends it invests in research and expects its intellectual property in patents to be protected. So far, the courts have agreed to. The U.S. Court of Appeals in Washington, D.C., said in the Scruggs case: "The fact that a patented technology can replicate itself does not give a purchaser the right to use replicated copies of the technology. Applying the first sale doctrine to subsequent generations of self-replicating technology would eviscerate the rights of the patent holder."

But Mitchell Scruggs, 63, and his brother Eddie, 54 -- fourth generation farmers in north Mississippi -- say farmers since George Washington have always saved seed from one harvest to plant the next season.

"They picked out me and a few more -- the larger farmers around -- to make an example out of," Mitchell Scruggs said. "They're hanging us up on the courthouse square in the stockade and saying this is what happens when you save Roundup Ready seed. It's not about money. It's about putting us out of business ... It's all about making an example."

The Center for Food Safety, a Washington-based non-profit public interest and advocacy group, which has looked into what it calls Monsanto's "use of U.S. patent law to control the use of staple crop seeds by farmers" since 2003, last week released a report updating its findings.

"Seed Giants vs. U.S. Farmers" found that as of December 2012, Monsanto had filed 142 patent infringement lawsuits against 410 farmers and 56 small farm businesses in 27 states for a total of $23.6 million in judgments. A 2010 report, "Monsanto v. U.S. Farmers," estimated out-of-court settlements in up to 4,531 "seed piracy" cases, cost farmers between $88.6 million and $160.5 million.

Cary Fowler, a plant geneticist who created the Svalbard Global Seed Vault to preserve the genes of diverse plant species in Norway, said in an email from Germany last week that the Bowman case is being closely watched.

"Farmers, of course, have traditionally felt that harvesting and reuse of seed -- which has been going on since Neolithic times -- is a natural part of farming, if not a right," Fowler wrote. "On the other hand, it is also true that plant breeding is expensive and time consuming, but something we all want and need. ... I don't know if the Court will be able to find a way to 'split the baby' but it seems clear to me that some sort of compromise in this situation would be better than winner-take-all."

While some of the facts differ, both the Bowman and Scruggs cases hinge on whether Monsanto's patent rights extend to seeds produced by farmers who buy its patented seeds for a first crop. The company requires buyers of its genetically modified seeds to sign a licensing agreement which prohibits re-use of seed produced as seed for replanting with the expectation the harvest will be sold to food processors.

In the Indiana case, Bowman, 76, went to a grain elevator to purchase any available seed -- "an undifferentiated mixture," according his Supreme Court brief -- for a second crop, not knowing, although suspecting, it would have the increasingly prevalent Roundup-resisting genetic trait. Monsanto sued for patent infringement, saying Bowman didn't have the right to use its invention without agreeing to its licensing terms.

In the Scruggs case, they bought the Roundup Ready seed but did not sign a licensing agreement and subsequently replanted future generations of those first seeds. Monsanto sued and got an injunction prohibiting further use of the progeny seeds. In response, Scruggs argued that Monsanto's actions violated antitrust law by tying the purchase of seed to the purchase of its herbicide and of attempting to monopolize the market.

(Bartholomew Sullivan is the Washington correspondent for The Memphis Commercial Appeal. Contact him at SullivanB@shns.com)