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Lab Times
Biobusiness
5-2010
Putting a Damper
on Monsanto
After a patent infringement lawsuit between Monsanto and
several seed importers, the European Court of Justice has limited Monsanto’s patent rights over glyphosate tolerant plants.
The judges argued that a patented DNA sequence which is presently incapable of performing the function for which it
was patented is not protected.
T
he US-based biotechnology company Monsanto (St. Louis, Missouri) is
not only well-known for its genetically engineered seeds, but also for its aggressive commercialization and trigger-finger
approach to litigation. Monsanto has filed
patent infringement lawsuits against many
farmers in Canada and the USA, often because of the farmers’ sale of seed containing Monsanto’s patented genes. A very wellknown case was the “Monsanto Canada Inc.
vs. Schmeiser” incident, dealing with putative patent infringement and the question
of whether it is legal that farmers sell seed
containing Monsanto’s patented genes.
This issue was ruled in favor of Monsanto in 2004 by the Canadian Supreme Court,
emphasising that, “cultivating a plant containing a patented gene and composed of
patented cells without license” is not allowed (in 2008, Monsanto and the same
farmer, Percy Schmeiser, settled amicably
in a “follow-up” lawsuit, arranging that the
US group has to remove unwanted genetically engineered (GE) seed from farmers’
fields).
herbicidal action of glyphosate is based
on an inhibition of the plant enzyme
5-enolpyruvylshikimate-3-phosphate synthetase (EPSPS), which is involved in the
biosynthesis of the aromatic amino acids
phenylalanine, tryptophan and tyrosine
via the so-called shikimate pathway. This
glyphosate action is lethal for plants. However, animals do not have the shikimate
pathway, so the direct toxicity of glyphosate to them is relatively low.
Some microorganisms such as the Agrobacterium strain CP4 have a version of EPSPS that is resistant to glyphosate inhibition. On the basis of the isolated and cloned
genes coding such glyphosate resistant EPSPS, Monsanto developed and patented
genetically engineered crops which are
glyphosate tolerant. The seed of these crops
grow into “Roundup Ready” crops, i.e. crops
which allow farmers to apply glyphosate as
a so-called post-emergence herbicide without killing the crops. Post emergent weed
control is a herbicide used to kill weeds after they have germinated or emerged from
the soil. To do this, the weed must be actively growing and not just green.
Aggressive behaviour
Monsanto’s frequent involvement in
high profile lawsuits with other well-known
companies, such as Syngenta, and even the
US government, and a recent investigation
into its business behavior by the US Department of Justice has made the company controversial around the world and a primary
target of environmental activists.
Monsanto is the world’s leading manufacturer of the broad-spectrum systemic herbicide glyphosate (IUPAC name:
N-(phosphonomethyl) glycine), which
Monsanto developed and patented in
the 1970s. Glyphosate is sold under the
trademark „Roundup“ and appears to be
the most used herbicide in the world. The
Profitable package deal
Current Roundup Ready crops include,
for example, canola, cotton, maize and soy.
For Monsanto the “package deal” of selling Roundup Ready crops in combination
with the Roundup herbicide is very profitable, and all the more so since Monsanto’s licensing agreements forbid seed-saving, the
old farming practice of keeping seed from
one crop to plant another. Thus, farmers are
forced to buy new genetically modified seed
for the next spring’s sowing.
With its decision number C-428/08 the
European Court of Justice has now put a
damper on Monsanto’s genetically modified
seed exploitation and enforcement tactics.
Since 1996 Monsanto has owned European patent EP 0 546 090, essentially
claiming a gene that encodes a new class
of glyphosate tolerant and highly efficient
EPSPS enzymes from special Agrobacterium, Achromobacter and Pseudomonas
strains. The patent also protects glyphosate tolerant plant cells containing said
gene. Monsanto has inter alia introduced
this gene into the genome of soybean
plants where it encodes the glyphosate resistant EPSPS enzyme and makes the soybeans tolerant of the Roundup herbicide.
“Roundup Ready” soybeans are cultivated on a very large scale in Argentina, where
Monsanto has no patent protection. Moreover, Argentina is one of the world’s leading soybean exporters, and the European
Union, particularly the Netherlands, is one
of the biggest importers. So a billion dollar
business is at stake.
A billion dollar business at stake
The Dutch companies Cefetra BV, Cefetra Feed Service BV, Cefetra Future BV and
the German company Alfred C. Toepfer International GmbH trade in soybean flour.
In 2005 and 2006 three shipments of soybean flour arrived at Amsterdam harbour.
The customs formalities were managed by
Dutch company Vopak Agencies Rotterdam
BV. Based on European Council Regulation
(EC) No 1383/2003, “concerning customs
action against goods suspected of infringing certain intellectual property rights and
measures to be taken against goods found
to have infringed such rights” Monsanto requested that customs suspend the release
of the three shipments and to take samples
for analysis. After investigation, DNA traces
were found which are characteristic of the
patented Roundup Ready soybeans, proving that the flour was produced from this
type of protected bean.
Image: MirekP/istockphoto
“Protecting” DNA sequences
Monsanto then filed a patent infringement lawsuit against the importers with the
Rechtbank’s Gravenhage, a first instance
court in The Hague, Netherlands. The political ramifications of this case were reflected by the official intervention of the State
of Argentina on the side of the defendants.
Monsanto argued that their product
claims directed to a DNA sequence or gene
confer “absolute protection”. This means
that any unauthorized use, including the
making, stocking, offering, selling or importing of the patented product is prohibited. This is a general regulation found in
the patent law of many European countries and also in the Dutch Patent Act. Accordingly, in Monsanto’s view, the import
of processed soybean flour comprising the
patented DNA sequence would be patent
infringement.
Conferring absolute protection?
On the other side, the defendants argued that Article 9 of the EU Biotech Directive (Directive 98/44/EC of the European
Parliament and of the Council of 6th July
1998 on the legal protection of biotechnological inventions), which has been implemented into Dutch patent law, states that,
“the protection conferred by a patent on a
product containing or consisting of genetic
information shall extend to all material ...
in which the product is incorporated and in
which the genetic information is contained
and performs its function.”
This provision of the EU Biotech Directive would be lex specialis, i.e. governing a
specific subject matter and therefore, as
doctrine dictates, superseding general national provisions. The EU Biotech Directive
was intended to harmonize the laws of EU
member states regarding the patentability of biotechnological inventions. The defendants argued that, since soybean flour
is inviable material after its processing, the
patented DNA sequence present in the soybean flour is incapable of expressing the
EPSPS enzyme for conferring glyphosate
tolerance to plants, and is thus unprotectable under Article 9.
Monsanto countered that the EU Biotech Directive is not intended to limit the
scope of protection for biotechnological inventions, and that it is sufficient that the
patented DNA sequence has exercised its
function (namely coding glyphosate resistant EPSPS enzyme in the soybean plant)
or that the DNA sequence, should it be isolated from the soybean flour, can be incorporated into the cells of a soybean plant and
can then once again exercise its function.
5-2010
The Dutch court found this Article 9 argument important, and referred the question to the European Court of Justice, the
highest judicial body of the European Union, for a preliminary ruling on whether import into Europe of soybean flour containing the patent protected DNA sequence constitutes an infringement of Monsanto’s European patent.
“A mere sequence is not patentable”
Lab Times
page 59
to patents predating the EU’s adoption of
the Directive in 1998 (Monsanto’s patent
was granted in 1996). This means that the
above limitations of the Biotech Directive
regarding the scope of protection of patented DNA sequences are applicable to all patents, regardless of when they were granted.
And since the European Court of Justice is
the highest court of the European Union,
the decision cannot be appealed. So the last
word on this subject has been spoken.
The decision will have significant consequences for businesses dealing in genetically modified plants. It will be possible to
grow genetically modified crops in a country where the respective gene is not protected. If the crops are then imported into the
EU in a processed inviable form so that the
gene cannot perform its patented function,
such import would not constitute a patent
infringement.
Monsanto, the Cefetra companies and
Alfred C. Toepfer International finally
reached an out of court settlement.
Michael Schneider
In brief, the European Court of Justice
held that the EU Biotech Directive provides
that a mere DNA sequence without indication of a function does not contain any technical information. Therefore, it is not a patentable invention.
In addition, the Directive provides under Article 9 that the protection conferred
by a patent on a product containing or consisting of genetic information shall extend
to all material in which the product is incorporated and in which the genetic information is contained and performs its function.
From this, the Court concluded that a
patented DNA sequence
which is presently incapable of performing
the function for which
it was patented is not
protected. Since Monsanto’s patented DNA
sequence is contained
in soybean flour, which
is inviable material after its processing, and
therefore presently
cannot confer glyphosate (Roundup) resistance upon a plant, it
is not protected. Thus,
the Court followed the
arguments of the defendants, and the similar final submissions of
Attorney General Paolo
Mengozzi.
The Court further
held that the EU Biotech Directive takes
priority over national
The European
law, so that individual
Court of Justice has
EU member states canlimited Monsanto’s
not permit patenting
rights on patented
of any DNA sequences
DNA sequences.
per se in their national
legislation. It also held
that the Directive’s provisions against patenting DNA sequences per
se applies retroactively
Photo: zxcynosure/istockphoto
Biobusiness