Last February, the U.S. Patent and Trademark Office rejected a Monsanto patent related to the company's dominant biotech seed business. On July 24, the office rejected three more.
Questions immediately surfaced regarding Monsanto's attempt to stop farmers from saving seed and what the patent rejections might mean for farmers the company has sued.
Before considering issues arising from the Patent and Trademark Office's actions, the agency's use of “rejected” should be explained.
According to Monsanto spokesperson Geri Burdak, “rejected” doesn't mean the patents are no longer valid. “That's not the case. The final process is (moving towards) a decision of whether (the Patent and Trademark Office) will ‘revoke’ the (patents). So ‘rejection’ doesn't mean the patent has been revoked.”
Dan Ravicher, executive director of the Washington, D.C.-based non-profit Public Patent Office, compares the Patent and Trademark Office's use of “rejection” to an indictment waiting for evidence.
“It's like someone indicted for a crime who hasn't been found guilty or sentenced,” says Ravicher. “That's where we're at now: the patents have been indicted for being invalid. Now, we'll find out if they really are. The decision to reject the patents isn't the end of the case. This isn't over.”
And farmers still can't save Monsanto-traited seed.
“At this point, this doesn't impact our patent portfolios for two reasons,” says Berdak. “One, they're still in the re-examination process. (Second), these are just four of many patents covering our technology.”
However many there are, Ravicher — whose organization alerted the Patent and Trademark Office to possible problems with the patents — wants to put them under the microscope.
Before he jumped into the fray, Ravicher was peripherally aware of Monsanto suing farmers over seed. “Some of those cases have gone through the courts and generated important decisions. But I wasn't aware of the extent of their suing until I reviewed the Center for Food Safety report.”
That report “goes into great detail cataloguing and analyzing” how Monsanto fights seed piracy. The report cites nearly 100 cases of Monsanto suing farmers.
“In the 68 cases where we could identify the patents involved in the suits, a vast majority involved the patents that have been rejected,” says Bill Freese, Center for Food Safety analyst.
“Of those 68, the 605 patent (rejected last February) was the only patent involved in 60 percent of the cases.
“The 605 patent and one more (no longer in effect) were at issue in 34 percent of the cases.
“The fact that these four patents have been central in the Monsanto lawsuits against farmers is very important.”
Intrigued by the report, Ravicher and colleagues undertook a review of the Monsanto seed patents — something they say farmers' attorneys hadn't done.
“If you look at the litigation documents, none of the defendants mounted a challenge to the patents. It seemed they hadn't been thoroughly reviewed, even after the court cases.”
Even so, there were no red flags waving. “There was nothing immediately obvious, but that isn't unusual. You must undertake a significant amount of analysis and review many materials. However, the conclusion we came to was there were several substantial issues with regard to the patents' validity.”
In prior “art” — a term used to describe previous discoveries that have a bearing on a patent's validity — there was information about how to modify seed in a generic way.
“Then, there was also information about which specific parts of the seed need to be modified in order to make it resistant to herbicides. Monsanto just combined those two things, which were already well-known.”
And since they're well-known, Ravicher argues, they shouldn't be proprietary. “We wrote a letter to the patent office saying, ‘Hey, you granted these patents but you weren't aware of all the prior art we've found. We're sending you evidence.’”
Scott Baucum says Monsanto was hardly surprised at the Patent and Trademark Office review.
“If you follow this, you'll find that people are constantly making challenges within the industry: those that own patents, those that want freedom to operate outside those patents,” says Monsanto's director of trait stewardship.
Such challenges “are routine more than exceptions. When the challenges were filed, from my perspective, it was one more in a long line.”
Rather than thoroughly review potential patents at the outset, Ravicher claims the patent system “has been created to encourage the issuance of patents. The examiners are placed under time limits and have quotas placed on them. They don't have the time or resources to be thorough.
“That's largely because Congress has been lobbied to make the patent office easy to get through. That's the way it's always been.”
Patents are properly reviewed from the outset, retorts Baucum.
“When (the patents in question) were reviewed, it was a very different world in biotechnology. We know far more now than we did in the 1980s and 1990s when these things were being developed and submitted.
“Things change and people learn things and come up with new and novel questions… It isn't that (patents) aren't reviewed on the front end — they're thoroughly reviewed.
“(There's) an ongoing conversation between those filing patents and those in the Patent and Trademark Office reviewing and approving them… There may be tweaks here and there to make sure concerns are (alleviated).
“As you go forward and the stakes rise, others become interested and find new and novel ways to challenge (the patents). It's more the norm than not in the biotech business that we need to defend our patent standing … throughout the life of the patent.”
Under the rules, Monsanto is entitled to make a response to the Patent and Trademark Office's rejections. After that, there is no set track and a variety of things could happen. One possibility: Monsanto could attempt to negotiate with the patent office to narrow the patent.
“They could say, ‘Well, the broad patent may be too much. But we still deserve one on this narrower part.’ That's a process we'll monitor,” says Ravicher.
The patent office typically expedites cases such as Monsanto's, trying to resolve re-examinations within 18 to 24 months. If the reexamination verdict isn't in Monsanto's favor, the company has the right to sue the patent office in federal court.
If that scenario plays out it could take years to resolve the patents.
While the review process is ongoing Monsanto can still sue farmers under the patents. However, “if they were to do so, the defendant could make a motion to the court to stay the case, or put it on hold, until the re-examination is completed,” says Ravicher.
Regardless, the patents' current standing “doesn't remove any requirements or responsibilities of using (Monsanto's) technologies in the field,” says Baucum. “The farmer isn't impacted.”
Ravicher believes farmers should have the right to save seed. “But Monsanto still has the legal right to sue farmers. Whether they will win those suits is another matter. But if farmers want to avoid being sued by Monsanto, they should probably stay away from doing anything that would (upset) the company.”
Asked how many seed patents Monsanto holds, Ravicher says it isn't just how many the company holds but how many it's asserting. “They could have some patents that they admit are (weaker) and they won't be suing under them. The patents to worry about are those they'll primarily assert. The four we challenged are the ones they're primarily using to sue farmers.”
In the wake of the patent office rejections, Monsanto claims the four rejects are only few of many. “If you look at our technology use guide — and you can download that from our Web sites — there are numerous patents we claim some protection on: certain processes, gene placements and those kinds of things,” says Baucum. “To keep the cases simple and moving forward, we choose to use one, or a few, of those patents.
“If you find yourself in a place where you need to assert your intellectual property rights, you need only prove a violation or infringement on one claim within one patent. It's redundant, expensive and burdensome on the entire system to sue on 15 patents.
“You don't get redundant remedies, you only get one remedy no matter how (egregious) the violation. In order to have judicial economy or efficiency, we pick one or two … patents that may be easier to make a case on…”
As expected, Ravicher is highly skeptical. “When Monsanto says, ‘We've got other solid patents’ I think that's a bit of a bluff.”
Better not call it, says Baucum, pointing to the fact that farmers sign contracts when using Monsanto traits. “Contractual commitments are separate from patents. Even in a worst-case scenario where the patent may not have the power it had before, there's still a contractual commitment…”
Ultimately, if the patents are rejected, will farmers who have settled or lost cases to Monsanto have any redress? Once a case is resolved, revisiting it is “very, very tough,” says Ravicher. “There are two different things. There's a final judgment, which the farmer didn't agree to. And there's a settlement — a contract between the farmer and Monsanto.”
In most settlements, the settlement isn't revocable and the money paid isn't retractable. Under those agreements, it is unlikely farmers who settled will get anything.
Under final judgments, revisiting a case is also difficult. “You have to try and convince a judge to reopen a case that's been closed.”
For pending cases, though, the recent patent rejections may provide sued farmers with an opportunity.
Jerry Young, a paralegal with the Tupelo, Miss.-based Waide and Associates law firm, has worked several cases of farmers sued by Monsanto.
One farmer's case has been appealed to the “federal court of appeals three times and the U.S. Supreme Court twice, I believe. Monsanto is trying to execute a judgment against him now.
“We're claiming they should await the outcome of the patent rejection. The (patent rejected in February) is the one that applies here and the Patent and Trademark Office rejected it because it was too obvious. We certainly hope the rejection is upheld. If it is, I believe Monsanto will have to change their practices.”
In another case Young has worked, the farmer settled. “In his settlement agreement there's language that if anything changed it could be reopened. Well, something has certainly changed.”
Not so, says Baucum. “If you talk to people that spend their lives in the intellectual property realm, they'll say this is nothing new.”
For more, see http://www.centerforfoodsafety.org/Monsantovsusfarmersreport.cfm; http://www.amseed.com/newsDetail.asp?id=97; http://www.monsanto.com/monsanto/layout/our_pledge/taking_action/protect_innov.asp; http://www.monsanto.com/monsanto/us_ag/content/stewardship/tug/2007TUGPDF.pdf.