Monsanto v. Schmeiser

Case Name: Monsanto Canada Inc. v. Schmeiser
Citation: 2004 SCC 34
Court: Supreme Court of Canada
Coram: McLachlin, Beverley; Iacobucci, Frank; Major, John C.; Bastarache, Michel; Binnie, William Ian Corneil; Arbour, Louise; LeBel, Louis; Deschamps, Marie; Fish, Morris J.

Abstract
This case comment analyses the decision in Monsanto Canada Inc v. Schmeiser. It provides the basic details of the case, the parties’ arguments, the reasoning the judges used to reach their decision and the dissenting opinion. The comment examines the Court’s interpretation of patent protection for genetically modified genes and cells embodied in plant varieties, and evaluates the implications of the decision. Finally, it considers the judgment’s impact on later developments in Canadian patent law regarding plant varieties.

Introduction
“Plant varieties” refer to plants having characteristics added or altered using genetic modification. The intellectual property legislation concerning plant varieties has to take into consideration both the need to give bioengineers an incentive to create these varieties by making them patentable, and farmers’ rights, since favouring these varieties heavily can unfairly disadvantage traditional farming practices and lead to a loss of biodiversity. An example of this occurred when when a bioengineering company sued a farmer for growing their genetically altered crop without permission. But the farmer vehemently denied it was intentional. His only explanation was that the wind blew those seeds into his farm. The case resolved doubts regarding what is patentable and what constitutes infringement in plant varieties. 

Facts
Biotechnology company Monsanto developed a special variety of the canola plant resistant to the herbicide glyphosate. The advantage of this was that herbicide could be used to eliminate weeds without harming the crop. They patented the variation and marketed it as “Roundup Ready Canola”. Monsanto granted farmers licenses to grow it at a rate of 15 dollars per acre. Percy Schmeiser was a farmer in Saskatchewan who grew three crops, including canola. Many farmers around the area grew Monsanto’s Roundup Ready Canola, but Mr. Schmeiser claimed he did not. Yet, a test found that 95-98% of his canola produce was composed of the genetically modified variety.

Monsanto brought a patent infringement action against Percy Schmeiser and his corporation. In the trial court, their suit succeeded. Schmeiser appealed this decision in the Supreme Court, primarily arguing that the subject matter of the patent shouldn’t be valid. The court didn’t dwell on whether the patent was valid, but focused on whether the defendant used the seeds. The court ultimately stuck to ruling in favour of Monsanto, with the caveat of Schmeiser not needing to pay Monsanto profits from his crop.

Issues
The appeal revolved around the question of whether Schmeiser used the patented gene and cell by collecting, saving and planting Monsanto’s seeds. The Patent Act grants the patent owner the exclusive right to make, construct, use and sell the invention. Considering that only the gene and cell were patented, not the plant, could the patent extend to collecting and storing the seeds, or was it limited to the genes and cells in their isolated form? Cases where the infringement is related to “use” of the patent are rare, making it all the more difficult to judge.

Reasoning
The court purposively interpreted the Patent Act. This meant that rather than focus on literal wording, the court understands the act contextually, emphasizing that patents ought to provide protection for that which the inventor has actually in good faith invented. It had been previously held that a defendant is still guilty of infringement when he uses a patent contained within something not patented, provided the patented part is significant. The genes and cells are contained within the plant, and not merely significant parts, but its building blocks. They concluded that Monsanto’s claim did not extend to all canola plants, as higher life forms, but more so to the genetically modified genes and cells embodied within them.

Finally, they had strong reason to presume that Schmeiser derived utility from the crops. Schmeiser said that he did not intentionally grow the modified crops, instead arguing that it blew by from a nearby field. This could not account for the high concentration of it on his field, but even accepting his argument, there was no proof he was proactive in removing it. Even if he did not spray Roundup herbicide, he could potentially benefit from the gene variety. There was also the possibility of “brown-bagging” the product to other farmers unable to pay the license fee.

Critique
The entirety of the coram did not concur with the majority’s reasoning. The dissenting opinion felt that they must make a distinction between using the plant and using the genes. In Harvard Mouse, it had been established higher life forms, including plants, could not be patented. As explained earlier, the patented genes are expressed throughout the plant. They felt that barring Schmeiser from growing the modified canola plant effectively meant giving Monsanto the right to patent the plant itself. Hence, the dissenting judges felt that if the patented gene had not been altered in a laboratory or recreated, but simply grown, it should not be eligible for infringement. 

Whether this view could’ve been accepted rests on a separate question – what are the implications of patenting genetically modified plants? And are they different, or drastically worse, from allowing the modified genes and cells to be patented?  Considering the plant’s use infringement could create a monopoly in agriculture. Farmers who can afford to license stronger crop varieties from biotechnology companies would have a significant advantage over those who do not.

Both sides had reasonable perspectives. The majority had solid reason to say Schmeiser had used the Roundup Ready Canola variety. It’s otherwise difficult to explain the disproportionate concentration in his field, and he could have unfairly benefitted from their sale. The minority was against the broader message being sent by holding Schmeiser liable for infringement – that higher life forms can, in fact, be patented, and not just the specific processes or alterations made to them for commercial use.

Impact
Monsanto Canada Inc. v. Schmeiser increased the protection available to biotechnology companies in Canada. Canada’s ruling on “higher life forms” being unpatentable set it apart from other major powers, which allowed patents for all plants and animals with certain prerequisites. Monsanto Inc continued to play a major role in cases related to patenting plant varieties, continuously shaping legislation and case law.

Conclusion
Monsanto Canada Inc v Schmeiser is a defining case for patent protection in Canada. The ruling is a two-sided coin: though the decision gives biotechnology companies greater protection of their work and more freedom to innovate, it highlights concerns regarding monopolisation and farmer rights. It illustrates the contrasting goals of innovation and equitable access in plant varieties. 

References

Monsanto Canada Inc. v. Schmeiser (2004) SCC 34
Harvard College v Canada (2002) SCC 76

Savita Mullapudi Narasimhan, ‘TOWARDS A BALANCED ‘SUI GENERIS’ PLANT VARIETY REGIME: Guidelines to Establish a National PVP Law and an Understanding of TRIPS-plus Aspects of Plant Rights’ (2008) United Nations Development Programme https://www.undp.org/sites/g/files/zskgke326/files/publications/TowardaBalancedSuiGenerisPlantVarietyRegime.pdf
Plantae, ‘Ethical Considerations in Genetic Engineering’ (18 March 2024) https://plantae.org/ethical-considerations-in-genetic-engineering/

Idris, Jalaluddin, Chang, ‘Ethical and legal implications of gene editing in plant breeding: a systematic literature review’ (2023) Journal of Zhejiang University https://pmc.ncbi.nlm.nih.gov/articles/PMC10710910/