United States Court of Appeals,

United States Court of Appeals,

Federal Circuit.

MONSANTO COMPANY, Plaintiff-Appellee,

Monsanto Technology LLC, Plaintiff-Appellee,

Loren DAVID, Defendant-Appellant

Procedural History

Patentee brought action against soybean farmer, alleging infringement of its patent claiming gene sequence for herbicide-resistant plants.

On April 20, 2006, the district court entered judgment against David

Defendant appealed to The United States District Court of Eastern Missouri who held the ruling in favor of the patentee.

Defendant appealed to the Federal Court of Appeals.

Does a patent for a gene sequence extend to prohibiting planting seeds containing that gene sequence?

Is a farmer able to save seed from a prior year's harvest contrary to the seed company's patent on those seeds?

May an expert witness base his facts upon evidence that itself would be inadmissable?

May a contract provision appearing on the back of a contract when the signature is on the front of the page be enforced?

Facts

Prior to planting his soybean fields in 2003, David purchased 645 lbs. Of genetically-modified soybean seeds from Monsanto.

The amount of seeds purchased by Monsanto was insufficient to completely plant David's soybean fields.

David purchased over 1,000 gallons of glyphosate-based herbicide in 2003, a herbicide which would have killed any soybean plants not of the genetically modified variety.

Rule of Law

1. Patents for gene sequence can restrict the planting of a seed with that gene sequence, because the seed contains the patented genes.

2. The testimony of an expert witness is admissible if: based upon sufficient facts or data, the testimony is the product of reliable principles and methods, and the witness has applied the principles and methods reliably to the facts of the case.

3. The existence of availability for the patents of plants under the Plant Patent Act of 1939 or the Plant Variety Protection Act of 1970 does not eliminate the availability of utility patents covering plants.

4. In patent infringement cases that are exceptional, the court may award the prevailing party attorney fees.

5. Absent a showing of fraud, a party who signs an agreement is bound by it regardless if additional provisions appear on the back of the signature page.

Reasoning

Court finds that planting a seed with a patented gene sequence would invoke liability for infringement were that seed planted contrary to contracted agreement between Monsanto and David.

The only evidence entered to counter Monsanto was the testimony of David and his daughter, and David's testimony was deemed unreliable in light of his changing his story at least three times.

Koppatschek relied upon the test prepared by Monsanto, and this test is the type of test that experts in the field would rely upon. Thus Koppatschek's testimony is reliable.

In light of David's blatant disregard of the stipulations of the contract with Monsanto, his attempts to cover up his infringement, his inconsistent testimony and his apparent disregard for the legal process, the Court finds that Monsanto v. David does fit the definition of an exceptional case.

Because David violated the Technology Agreement which he signed with Monsanto, there was no reason why Monsanto could not be awarded the attorney's fees stated in said agreement.

Holding

Court hold the decision of the lower court in part, holding that the district court did not err in determining that David planted saved seed. The Court held the damages awarded in the amount of $10,000 in enhanced damages, $164,608.03 in costs, and $323,140.05 in attorney fees. However, the Court finds that the alternate award of $30,542.99 duplicated the $164,608.03 damages, and therefore was erroneous and therefore reversed. The court upholds a royalty fee of $55.04 per unit. The court remanded, however, the density of those seeds to the lower court, finding the basis on David's quoted 120 lbs density to be erroneous.

Use of Precedent, Effect on Future Cases

The holdings of this court uphold the findings of the court in Monsanto v. McFarling, which states that absent a showing of fraud, a party who signed an agreement was bound by that agreement.

The holding of this court uphold the findings of the court in Gussack v. Xerox, in which it ruled that testimony can be properly admitted by an expert who did not perform his own tests, as well as Ratliff v. Schiber Truck Co., which found that an expert may properly rely on a report prepared by a third party.