Monsanto v Cefetra: Article 9 of the Biotech Directive

Monsanto is the owner of a European patent relating to glyphosate-tolerant 5-enolpyruvylshikimate-3 phosphate synthesis. This patent protects one of the key biotech inventions that are part of Monsanto’s Round-Up Ready technology. This particular invention results in genetically modified, herbicide resistant plants and creates benefits at the crop growth stage of soy production. Farmers in Argentina have widely adopted this technology and Argentina has become one of the largest exporters of soy products. Argentina however, is one of the few places in the world where Monsanto has no patent protection for the modified genes and DNA molecules. Monsanto has therefore targeted European imports of soy derivates (important cattle feedstuffs) from Argentina, relying on its European patents.

As background, the soy plants are grown in Argentina. Once the soy beans are harvested, they are processed into soy meal pellets. The oil is then extracted, and the remains are crushed, dried, heated and pressed into the end product, before being shipped to Europe.

Monsanto claims that intact DNA molecules are residually present in soy meal imported into Europe and therefore, its patent is infringed under national patent laws in Europe.

However, the soy meal importers claim that on the basis of Article 9 of the Biotech Directive, the scope of protection of Monsanto’s patent does not extend to situations where the DNA molecules are residually present and are incapable of performing any function at all.

Article 9 of the Biotech Directive provides as follows:

The protection conferred by a patent on a product containing or consisting of genetic information shall extend to all material, save as provided in Article 5(1), in which the product is incorporated and in which the genetic information is contained and performs its function.

The case is pending before the District Court of The Hague, which has referred several questions to the Court of Justice, namely:

Should Article 9 of the Biotech Directive be understood in such a way that it confers protection when the genetic information present in the material does not perform any function but has performed a function in the past or when it is theoretically capable of performing a function in the future (i.e. when the gene sequence is isolated and again introduced in plant cells)? And

Should the protection offered by Article 9 of the Biotech Directive be considered to be exhaustive, or is there still room for absolute product protection under national laws?

The Court of Justice answered the questions as follows:

Article 9 of Directive 98/44/EC of the European Parliament and of the Council of 6 July 1998 on the legal protection of biotechnological inventions is to be interpreted as not conferring patent rights protection in circumstances such as those of the case in the main proceedings, in which the patented product is contained in the soy meal, where it does not perform the function for which it is patented, but did perform that function previously in the soy plant, of which the meal is a processed product, or would possibly again be able to perform that function after it had been extracted from the soy meal and inserted into the cell of a living organism.

Article 9 of the Directive effects an exhaustive harmonisation of the protection it confers, with the result that it precludes the national patent legislation from offering absolute protection to the patented product as such, regardless of whether it performs its function in the material containing it.

Article 9 of the Directive precludes the holder of a patent issued prior to the adoption of that directive from relying on the absolute protection for the patented product accorded to it under the national legislation then applicable.

The Court of Justice has therefore confirmed that Monsanto cannot invoke its patent rights in situations in which the genetic information does not perform any function at all.

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