Jack and the Beanstalk: Property Rights in Genetically Modified Plants
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View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by University of Minnesota Law School Minnesota Intellectual Property Review Volume 3 Issue 2 Article 1 2002 Jack and the Beanstalk: Property Rights in Genetically Modified Plants Nathan A. Busch Follow this and additional works at: https://scholarship.law.umn.edu/mjlst Recommended Citation Nathan A. Busch, Jack and the Beanstalk: Property Rights in Genetically Modified Plants, 3 MINN. INTELL. PROP. REV. 1 (2002). Available at: https://scholarship.law.umn.edu/mjlst/vol3/iss2/1 The Minnesota Journal of Law, Science & Technology is published by the University of Minnesota Libraries Publishing. Jack and the Beanstalk: Property Rights in Genetically Modified Plants Nathan A. Busch1 INTRODUCTION The conversion of domesticated plant species into transgenic plants and their subsequent utilization in the agricultural production of usable crops has created a tension between the farmer, the seed manufacturer, and the public. The farmer desires to save the progeny transgenic seeds from one planting cycle for use in the next and to be autonomous in his decisions regarding the utilization of his land, his financial resources, and his crop. The seed manufacturer desires to make a profit from the transgenic plant. The public desires that the food and fiber produced by the transgenic plants be safe for consumption. While all of these positions are equally valid, discussions among these three parties usually fall into a quagmire of often emotional and irrational arguments. The theory upon which this paper is founded is that each of the parties is merely articulating, sometimes without eloquence, a position derived from the property rights fundamental to each party. Through examination of the property rights of each of the parties, a path to the resolution of the tension will be illuminated. This paper aims to examine the farmer’s and seed manufacturers’ property rights in genetically modified plants, leaving the public property rights for the time being. The story of Jack and the Beanstalk2 provides a useful allegory and sets 1. J.D. candidate, University of Minnesota Law School, 2002. B.S. Chemical Engineering, Purdue University, 1978. Ph. D. Biomedical Engineering, Louisiana Tech University, 1984. Ph. D. Chemical Engineering, Rutgers University, 1995. I wish to thank Dr. Edward Coen, Professor Emeritus of Economics at the University of Minnesota, for many helpful and constructive discussions on the topics addressed in this work. I also wish to recognize the assistance of the librarians of the University of Minnesota Law School law library. Without their patient assistance this work would never have been brought forward. 2. See generally PAUL GALDONE, JACK AND THE BEANSTALK (1974) (published by Clarion Books, New York). The version of the tale of Jack and 2 MINNESOTA INTELL. PROP. REVIEW [Vol. 3:1 the stage for this discussion. In the tale of Jack and the Beanstalk, Jack trades a sixpence, which his mother gave him for a magic bean.3 Jack plants the bean, which produces a vine that reaches up to a magic castle in the clouds. The spectacular growth rate and ultimate size of Jack’s beanstalk resulted from the bean’s magic. The vine also produced progeny beans. Jack, presuming he was a clever entrepreneur, could have either saved the progeny beans for planting the next year (and hence found another magic castle in the clouds) or sold the beans to others. No legal consequences would have befallen Jack for engaging in either of these two alternatives. With current biotechnology results analogous to the beanstalk’s spectacular growth rate and size, Jack’s beanstalk could be the result of genetic modification. In modern times, various statutes would protect Jack’s genetically modified progeny beans. While an innocent child’s story, the tale of Jack and his beanstalk would indeed keep modern day attorneys busy for quite some time. In modern times, Jack, by purchasing the bean, might be subject to restraints imposed by the Plant Variety Protection Act4 and the Patent Act. By planting the bean and growing the beanstalk, Jack could be infringing the protections afforded by a utility patent granted to the bean’s manufacturer. In addition, by harvesting the progeny beans from the beanstalk, Jack might be liable for damages under the Patent Act, the Plant Variety Protection Act, and contract law for violating the terms of a license agreement. The following two examples illustrate that Jack’s modern day hypothetical case indeed resembles reality in several aspects. Percy Schmeiser, a canola farmer in Canada, has been developing a variety of canola suitable for his farming practice for nearly 50 years. Monsanto representatives entered his fields and found plants bearing Monsanto’s gene, which confers the Beanstalk written by Paul Galdone was adapted from B. A. T., THE HISTORY OF MOTHER TWADDLE AND THE MARVELOUS ACHIEVEMENTS OF HER SON JACK and published by J. Harris, corner of St. Paul’s Churchyard (1807). 3. In the story of Jack and the Beanstalk, Mother Twaddle found the sixpence while cleaning her cottage. She sent Jack to the fair to purchase a goose for dinner. Instead of purchasing the goose, Jack spent the entire sixpence on a single bean. Because of the special properties of the bean, a modern version of the story might posit that the bean was genetically modified. 4. Plant Variety Protection Act, Pub. L. No. 91-577, 84 Stat. 1542 (1970) (current version at 7 U.S.C. §§ 2321-2582 (1994 & Supp. II 1996)). 2002] JACK AND THE BEANSTALK 3 glyphosate resistance on the canola. Monsanto sued Mr. Schmeiser.5 The result: Monsanto won. In his decision, Judge W. Andrew MacKay found Mr. Schmeiser guilty of infringing Canadian Letters Patent No. 1,313,830 assigned to Monsanto.6 Dallas Thomason is a cotton and beef farmer in Rayville, Louisiana. He also owns a cotton ginning facility. Mr. Thomason purchased “brown-bag” cotton seed from a local commercial seed dealer; however, he did not know that the seeds were Bt cotton seeds. The commercial seed dealer neither asked Mr. Thomason to sign a technology use license nor did Mr. Thomason actually sign such a license. After Mr. Thomason planted the cotton seeds, Monsanto received a tip that the seeds Mr. Thomason had planted were Bt cotton seeds.7 Monsanto sued because Mr. Thomason did not obtain a technology use license before planting the seeds. Monsanto won.8 Dallas Thomason was found guilty of patent 5. Monsanto has also levied a heavy fine against farmers who have genetically modified plants on their land without a valid license agreement. Once Monsanto finds that a farmer is allegedly growing an unlicensed crop, it sends a letter to the farmer demanding payment of a fine. One of these letters, made available on the Internet, was sent to Mr. Edward Zielinski of Mikado, Saskatchewan, on November 12, 1998 and signed by Mr. Keith A. MacMillian, Director of Legal Affairs of Monsanto Canada, Inc. Mr. Zielinski had obtained the seeds at issue as the result of a trade with a farmer from Prince Albert. See http://www.tv.cbc.ca/national/pgminfo/canola (last visited Oct. 20, 2001). The letter stated that Monsanto Canada had “very good evidence to believe that Roundup Ready canola was planted on approximately 250 acres of land identified as SE 28-30-2, NE 28-30-2 and SE 19-30-2 in violation” of propriety rights which Monsanto had in the Roundup Ready canola. The letter further stated that before “making any final decision as to what steps we will be taking, and in an attempt to resolve this issue in a timely and economical manner, we are prepared to refrain from commencing any legal proceedings against you subject to the following” conditions: first, that a fine be paid to Monsanto in the amount of $28,750.00; second, that “Monsanto has the right to take samples from all of your owned or leased land and storage bins for three years from the date of this letter”; and third, that Mr. Zielinski “agree not to disclose the specific terms and conditions of this Settlement Agreement to any third party.” This letter is available at http://www.tv.cbc.ca/national/pgminfo/canola/docz1.html (last visited Oct. 20, 2001). 6. See Monsanto Can., Inc. v. Schmeiser Enters., Ltd., 2001 FCT 256 (Fed. Ct. Canada 2001), available at http://decisions.fct-cf.gc.ca/fct/2001/ 2001fct256.html (last visited Aug. 25, 2001). 7. Evidently, the person who sold Mr. Thomason the Bt cotton seeds also informed Monsanto that Mr. Thomason was using those same seeds without the technology use license. Telephone Interview with Mr. Dallas Thomason, Farmer, Rayville, Louisiana (July 3, 2001) [hereinafter Interview: Thomason]. 8. See Grower Fined for Saving Bollgard Seed, PROGRESSIVE FARMER, October 2000, at 10. 4 MINNESOTA INTELL. PROP. REVIEW [Vol. 3:1 infringement and violation of the provisions of the Plant Variety Protection Act in a pre-trial decision by Federal Magistrate Kirk. The trial jury, deciding on the question of damages only, found Mr. Thomason liable to Monsanto for $401.00 per acre for infringing the patent, and liable to Delta and Pine Land for $100.00 per acre for violating the PVPA. Typically, Mr. Thomason retained neighboring farmers’ cotton seeds as consideration for ginning their cotton. Most of these seeds he sold for animal feed and oil extraction, while retaining the balance for planting his own fields. Even if the case against Mr. Thomason concerned these particular seeds, he would still have been found guilty of infringement and violation of the Plant Variety Protection Act because he would be using the Bt cotton seeds without a license.