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Context of 'May 21, 2004: Supreme Court: Schmeiser Infringed on Patent, But Owes Nothing to Monsanto'

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Mike Robinson, owner of a private investigation company that works for Monsanto, visits Percy Schmeiser at his farm. Schmeiser learns that Monsanto is investigating him and that an investigator working for Robinson took plant samples from his fields in 1997 (see August 18, 1997). Robinson says Monsanto suspects Schmeiser is illegally growing its patent-protected Roundup Ready Canola. Schmeiser accuses Robinson’s company of trespassing. [Star Phoenix (Saskatoon), 6/14/2000; Federal Court of Canada, 6/22/2000, pp. 21 pdf file; Monsanto Canada Inc. v. Percy Schmeiser, 3/29/2001, pp. 21 pdf file]

Entity Tags: Mike Robinson, Percy Schmeiser

Timeline Tags: Seeds

Monsanto employee Robert Chomyn requests and receives a sample of Percy Schmeiser’s harvested seeds from the Humboldt Flour Mills where Schmeiser brought his seeds for inoculation (see April 24, 1998). [Washington Post, 5/2/1999] The person who retrieves the sample is employee Morris Hofmann, who, according to Schmeiser, later admits (see After June 19, 2000) that he had either not supplied the seed, or that he supplied seed that was not Schmeiser’s. [Crop Choice, 5/24/2002] The samples provided to Monsanto have apparently been cleaned. (Schmeiser will later testify in court that the seeds he brought in for inoculation were bin-run seed, and thus full of chaff.) [Federal Court of Canada, 6/22/2000, pp. 19 pdf file] Chomyn sends the seeds on April 28 to Aaron Mitchell, Monsanto’s lead investigator in the case against Schmeiser. [Washington Post, 5/2/1999] Percy Schmeiser is neither consulted beforehand nor informed of the event until 1999. [Monsanto Canada Inc. v. Percy Schmeiser, 3/29/2001, pp. 22 pdf file]

Entity Tags: Aaron Mitchell, Percy Schmeiser, Rob Chomyn, Humboldt Flour Mills

Timeline Tags: Seeds

Percy Schmeiser announces that he will appeal Federal Judge Andrew MacKay’s ruling (see March 29, 2001) that he infringed on Monsanto’s patent for Roundup Ready Canola . [Star Phoenix (Saskatoon), 5/25/2001; Star Phoenix (Saskatoon), 6/21/2001]

Entity Tags: Percy Schmeiser

Timeline Tags: Seeds

The Saskatoon Star Phoenix reports that Monsanto’s legal costs for suing Percy Schmeiser amount to $726,768.10 CAD. [Star Phoenix (Saskatoon), 7/24/2001] Reportedly, of that amount, $30,000 CAD was paid to Dr. Keith Downey, one of the scientists who testified against Schmeiser. [Institute of Science in Society, 9/2002] Schmeiser’s lawyer, Terry Zakreski, tells the newspaper that he believes Monsanto will attempt to seek about $220,000 CAD of that amount. [Star Phoenix (Saskatoon), 7/24/2001]

Entity Tags: Percy Schmeiser, Monsanto, Terry Zakreski, Keith Downey

Timeline Tags: Seeds

Federal Court of Canada Justice Andrew MacKay orders Percy Schmeiser to pay Monsanto $153,000 CAD in order to compensate the company for a portion of its legal costs. Monsanto sued Schmeiser in 2000 (see June 5, 2000-June 21, 2000) for illegally planting and harvesting canola in 1998 that he “knew or ought to have known” contained Monsanto’s patent-protected Roundup-resistant gene. This sum of money is in addition to the $19,832 CAD that Schmeiser has already been ordered to pay the company (see May 23, 2001). [Star Phoenix (Saskatoon), 4/29/2002]

Entity Tags: Monsanto, Percy Schmeiser, Terry Zakreski

Timeline Tags: Seeds

Canada’s Supreme Court hears the case of Percy Schmeiser v. Monsanto. Schmeiser is appealing a lower court’s decision that he infringed on Monsanto’s patent when he planted canola seed in 1998 that he “knew, or ought to have known” was from glyphosate-resistant plants. Intervening on Schmeiser’s behalf are a consortium of six non-government organizations (Council of Canadians; Action Group on Erosion, Technology, and Concentration; Sierra Club; National Farmers Union; Research Foundation for Science, Technology, and Ecology; and the International Center for Technology Assessment) and the Ontario attorney general. The Ontario government is backing Schmeiser because it fears that a decision upholding the lower court’s ruling would encourage more gene patents and increase healthcare costs. Monsanto’s lawyers also presenting arguments before the court. In addition to defending the lower courts’ ruling that Schmeiser infringed on the company’s patent, the lawyers are cross-appealing the decision that the farmer’s profits in 1998 (awarded to Monsanto) only amounted to $19,832 CAD. Monsanto has calculated Schmeiser’s profit to be $105,000 CAD. Monsanto’s interveners include the Canola Council of Canada, BIOTECanada, and the Canadian Seed Trade Association. [BC Politics, 2/2/2004]
Schmeiser's Arguments -
bullet Schmeiser’s lawyer, Terry Zakreski, challenges the validity of Monsanto’s patent arguing that the patent contradicts the Harvard College v. Canada Supreme Court decision that higher-life forms cannot be patented. He explains that in claiming exclusive rights to glyphosate-resistant plant genes and cells, Monsanto is in effect claiming patentholder rights to any plants and seeds containing those genes and cells, which as the Supreme Court has already decided, is not legal. He argues that Monsanto should have instead chosen to protect its intellectual property rights under the Plant Breeder’s Rights Act, which was designed to protect the rights of seed developers. [Associated Press, 1/20/2004; BC Politics, 2/2/2004]
bullet Zakreski also argues that extending Monsanto’s patentholder rights to second-generation roundup-resistant seeds makes it illegal for farmer’s to save and share seeds—the 12 thousand year old practice responsible for creating domesticated crops. [Vancouver Sun, 1/20/2004]
bullet Even if the patent is ruled valid, according to Zakreski, Monsanto implicitly waived its patentholder rights when it failed to control the spread of its invention after releasing it unconfined into the environment. [BC Politics, 2/2/2004]
bullet Zakreski also argues that even if the court upholds the validity of Monsanto’s patent, Schmeiser did not violate the patent, because he never exploited its utility—the resistance it provides against glyphosate. The only way to use the patent, he says, is to spray Monsanto Roundup Ready Canola with Roundup, which Schmeiser did not do. [BC Politics, 2/2/2004]
bullet Zakreski notes an inherent contradiction in the claim that Monsanto is entitled to all profits resulting from the sale of seed containing the patented gene. Zakreski offers the hypothetical example of a farmer whose canola is infested with two different genes, each patented by a different company. Would each of the patentholders be entitled to the full profit? Would the farmer be required to pay each of them 100 percent, in effect being forced to pay out twice the profit from his crop? [BC Politics, 2/2/2004]
Monsanto's argument -
bullet Monsanto’s lawyers reject Schmeiser’s position that a farmer’s right to save seed overrides the company’s patent rights. In order for them to recover research and development costs they must charge farmers annually for use of the seed containing their patented gene, they argue. [Vancouver Sun, 1/20/2004; Associated Press, 1/20/2004]
bullet The company’s lawyers also insist that the Harvard College v. Canada decision does not apply to this case. Its patent is not on the entire plant, but rather just one of the plant’s ingredients. He compares the company’s gene to a special patented steel that is used for an automobile where the inventor’s rights extend only to the steel, not the entire car. The judges interrupt Monsanto’s presentation on several occasions challenging the lawyer’s steel analogy and asking Monsanto’s lawyers where Monsanto’s patent rights would end since plants have the ability to reproduce themselves and hence the inventions contained within them.
bullet Lawyers for Monsanto’s interveners said that invalidating the company’s patent would harm Canada’s economy and undermine its patent system. “Patents create a climate that favors new research,” argues A. David Morrow, a lawyer for the Canadian Seed Trade Association. [Associated Press, 1/20/2004]
bullet Biotech Canada’s lawyer, Anthony Creber, similarly states, “I’m nervous that if you don’t give (patent protection) for seeds and cells, you will have a hollow Patent Act with severe economic consequences.” [Star Phoenix (Saskatoon), 1/21/2004]
bullet Mona Brown, a lawyer with the Canadian Canola Growers Association, tells the judges that the “patent makes us more profitable and better farmers.” [Associated Press, 1/20/2004]

Entity Tags: International Center for Technology Assessment, Research Foundation for Science, Technology and Ecology, National Farmers Union, Canola Council of Canada, BIOTECanada, Canadian Seed Trade Association, Action Group on Erosion, Technology, and Concentration, Sierra Club, Monsanto, Percy Schmeiser, Council of Canadians

Timeline Tags: Seeds

In a split 5 to 4 decision, the Supreme Court of Canada rules that Percy Schmeiser violated Monsanto’s patent when he grew canola in 1998 that contained the company’s patented Roundup Ready gene. [Washington Post, 5/22/2004; Vancouver Sun, 5/22/2004; New York Times, 5/22/2004]
Decision - Schmeiser’s lawyer, Terry Zakreski, argued that the protection of Monsanto’s patented genes and cells necessarily extended to restricting the use of any plants and seeds containing them. Since this in effect means that Monsanto is claiming patentholder’s rights for the whole plant, the court must rule, in light of its 2002 Harvard College v. Canada decision that higher-life forms cannot be patented, that the company’s patent must be invalid. However, the majority rejects Zakreski’s argument and affirms the validity of Monsanto’s patent. The majority says the “Harvard Mouse” case does not support Schmeiser’s argument because, while Harvard had sought to patent an actual mouse, Monsanto’s patent is limited to certain genes and cells. Furthermore, Harvard did acquire patents on certain parts of the mouse, a plasmid and a somatic cell culture, and therefore the “Harvard Mouse” case supports Monsanto case, not Schmeiser’s. [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 8] The majority also rejects Schmeiser’s defense that he did not use Monsanto’s patented genes. While sidestepping the issue of whether or not it would be necessary to spray Roundup on the plants in order to exploit Monsanto’s patented genes and cells, the majority says that his 1998 canola crop provided him with “stand-by” utility, which a previous court decision determined constituted “use.” In possessing and growing the crop, the majority argues, Schmeiser had reserved the option to spray it with Roundup, should the need arise, or sell it to make a profit. The majority thus holds that Schmeiser infringed on the patent. [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 11-13] It is important to note that the majority says this decision does not concern “the innocent discovery by farmers of ‘blow-by’ patented plants on their land or in their cultivated fields.” The majority makes it clear that they do not accept Schmeiser’s claim that his property was “contaminated” with Monsanto’s genes. [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 5] For them it is accepted fact that (1) “tests revealed that 95 to 98 percent of his 1,0[3]0 acres of canola crop [in 1998] was made up of Roundup Ready plants” [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 6] ; (2) “he sprayed Roundup to isolate the Roundup Ready plants he found on his land” [emphasis added]; (3) he “segregated the seeds”; and (4) “he ended up with 1030 acres of Roundup Ready Canola.” All of these statements are made as matters of accepted fact even though they were, in fact, all disputed by Schmeiser (see January 20, 2004). [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 15] The court does however side with Schmeiser on the issue of compensation owed to Monsanto. “[Schmeiser’s and Schmeiser Enterprises’] profits were precisely what they would have been had they planted and harvested ordinary canola. They sold the Roundup Ready Canola they grew in 1998 for feed, and thus obtained no premium for the fact that it was Roundup Ready Canola. Nor did they gain any agricultural advantage from the herbicide resistant nature of the canola, since no finding was made that they sprayed with Roundup herbicide to reduce weeds. The appellants’ profits arose solely from qualities of their crop that cannot be attributed to the invention.” [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 17]
Dissenting Opinion - The minority opinion disagrees that any of Monsanto’s rights as a patentholder extend to plants, seeds, and crops. It accepts that Monsanto’s patent claims for the genes and cells are valid, but says that none of the protections afforded by the patent extend “to the plant itself, a higher life form incapable of patent protection.” According to the minority, “In order to avoid the claim extending to the whole plant, the plant cell claim cannot extend past the point where the genetically modified cell begins to multiply and differentiate into plant tissues, at which point the claim would be for every cell in the plant, i.e., for the plant itself.” Consequently, only the original genes and cells produced by Monsanto in the lab and contained within the original seed are protected by the patent—the resulting plant, its seeds, and the plants that grow from those seeds, are not. “Therefore saving, planting, or selling seed from glyphosate-resistant plants does not constitute an infringing use,” the minority concludes. [Percy Schmeiser v. Monsanto Canada Inc., 5/21/2004, pp. 22]

Entity Tags: Monsanto, Percy Schmeiser

Timeline Tags: Seeds

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