Work on 5, 3, 2, 11, 20, and 11, 21. My final company be shrugs. Dr. Robertson
. May I please court Jimmy Robertson from Jackson, Mississippi, and represent the Scrubs of Helles, who are appealing three separate summary judgment, said with granted in the United States District Court for the Northern District of Mississippi. I'd like to begin by emphasizing the reasons why the second opinion of this court in my Santo versus McFarling is not controlling here in any important particular. And those reasons are first that opinion makes very clear that it's predicated upon the 435 patent
. It corrected very clearly a mistake or a slip of the tongue for like a better way of expressing from the first Monsanto opinion that said that the patents read on seeds and plants, not so in the 605 patent, which is all that's left in this case. The 435 patent, which did include seeds and plants, is not involved in this case. The second distinction between that case and this case is the first, the McFarling case was strongly influenced by the fact that the farmer had signed a technology agreement with Monsanto, not so here
. That's the reason the case was in Mississippi instead of in St. Louis. There is no Monsanto technology agreement here
. Third, by far the most important is in this case, the Scrubs of Helles presented to the District Court, all of the proofs that the court said were lacking in the Monsanto case. Not only was there substantial evidence on each of the important points that showed that there were more than just genuine issues of material fact that were strongly supported by expert opinions from Professor Ian Ayers, Yale and antitrust economist Professor Peter Carstensen from Wisconsin and antitrust economist with particular experience in agricultural markets. Professor Robert Tullison and Clemson, who is a cartel specialist professor David Parvin, who is a Mississippi agricultural economist and of course having to do with the patent validity issues to begin with
. Dr. William Folk from the University of Missouri, who is a plant molecular biologist who presented a very important and credible two affidavits and expert reports that establish that with respect to the patents that are in issue in this case, one taking the specification could not reproduce the inventions that are claimed in the patents and therefore at the very least there is a question fact with regard to the issues of patent validity. What did your experts say about written description? Was there any contention made about written description below that the three examples in the 605 patent were insufficient to describe the entire genus? Yes, and the one that was not talking about the genus, whether it was sufficient to describe the promoter sequences from the cauliflower virus, but whether the combination of the promoter sequences with other genetic material was sufficiently described because of my understanding is that the 605 patent are only three examples given of that combination
. You are on a smart recollection that two of those examples had to do with the 19S patent instead of the 35S patent and so the patent claims the 35S and the 19S. The 19S is not in involved in this case. So you only have one that is actually related to this case
. Yes, Dr. Folk went through the written description analysis and presented an opinion that I think is very much supported by the evidence, supported by peer review literature. But opinion about what? I'm not asking you about whether the promoter sequence of the cauliflower virus was sufficiently described
. I'm asking you a different question. I'm really asking whether this was raised at all and that is the question of whether the combination of the promoter sequence with other genetic material, which is the subject of this patent was adequately described. And my understanding is that there are only three examples of that given in the specification of the 605 patent
. You honor my best recollection of Dr. Folk's opinion is that he did consider the entire specification and did offer an opinion that one skilled in the art could not take the specification under the written description test and understand that the invention was in the possession of the inventors and he made the same opinions with respect to the enablement requirement of section one 12 as well. So I would answer your question yes, Your Honor
. The Dr. Folk did make those representations and explain those in his opinions. His original opinion filed in February of 02 a supplemental opinion. Where do I find that he addressed that particular point? I do not have that in my fingertip's honor. Okay. With respect to the the the 605 patent does not claim plants and seeds and I think it's very important to understand that because of that the patent grant that is was important in my calling case and is important to the district court does not extend to a number of the claims and activities that Monsanto was involved in in this case specifically the 605 patent has is nothing in it that shows that Monsanto has any rights with respect to the roundup or glyphosate herbicides
. Where do I find that he addressed that particular point? I do not have that in my fingertip's honor. Okay. With respect to the the the 605 patent does not claim plants and seeds and I think it's very important to understand that because of that the patent grant that is was important in my calling case and is important to the district court does not extend to a number of the claims and activities that Monsanto was involved in in this case specifically the 605 patent has is nothing in it that shows that Monsanto has any rights with respect to the roundup or glyphosate herbicides. We presented substantial evidence that there is either tying or bundling or leveraging or whatever you want to call it and I suggest that that is an instance where Monsanto has exceeded the patent grant. A second one has to do in this gift this is the issue in Mac Farley in a sense having to do with the tie between the trait the transgenic trait the claimed in the 605 patent the roundup ready trait and the seed itself. Now it emphasized that Monsanto has no rights in the seed itself in fact those seeds the germ plasm was produced by the seed partners
. We presented substantial evidence that there is either tying or bundling or leveraging or whatever you want to call it and I suggest that that is an instance where Monsanto has exceeded the patent grant. A second one has to do in this gift this is the issue in Mac Farley in a sense having to do with the tie between the trait the transgenic trait the claimed in the 605 patent the roundup ready trait and the seed itself. Now it emphasized that Monsanto has no rights in the seed itself in fact those seeds the germ plasm was produced by the seed partners. I think it's important to understand that Monsanto set this up in their system from the beginning as two separate products even though they are physically together. Monsanto may clear in a 1999 memorandum to the justice department having to do with the then proposed acquisition of Delta and Pine Land Company that it was only in the trait market it was not in the seed market itself and in fact in that in support of that position Monsanto's many planning documents set up the proposition that the seed and the trait are two separate products. The trait is always owned by Monsanto it is licensed to the farmer for a technology fee the seed itself is owned by the seed company which is also a seed partner a licensee of Monsanto and it in turn sells the seed in its downstream channel to the farmer itself
. I think it's important to understand that Monsanto set this up in their system from the beginning as two separate products even though they are physically together. Monsanto may clear in a 1999 memorandum to the justice department having to do with the then proposed acquisition of Delta and Pine Land Company that it was only in the trait market it was not in the seed market itself and in fact in that in support of that position Monsanto's many planning documents set up the proposition that the seed and the trait are two separate products. The trait is always owned by Monsanto it is licensed to the farmer for a technology fee the seed itself is owned by the seed company which is also a seed partner a licensee of Monsanto and it in turn sells the seed in its downstream channel to the farmer itself. So the point is that under the 605 patent there's nothing in the claims of that patent that extends to the right to control the seed or the herbicide that's used with the particular product in this instance the trait the roundup ready trait but most important of all there's nothing in the 605 patent and the other three patents that relate to the Bogart cotton that in any way authorizes Monsanto to establish what the lack of a better term is a seed cartel and when I say that I mean that Monsanto has license agreements exemplars of which are in the record that make it very clear that Monsanto has tied up the germ plasma market that is all of the seed companies any I think the expression by one of Monsanto's departments from Mr. Dave Rylander was anybody who is anybody in the seed business has a license with us what that has had the effect of doing of course is accomplishing the vision that set forth in Monsanto's original planning documents which was not just to be able to go into the market and compete with respect to this product that they they claim to have invented but at rather to control the market to the exclusion of all other competing products and in fact they've succeeded because the record reflects that with respect to the three trait products that are involved in this case the roundup ready soybean trait the only other product that's out there as of the close of the record was STS soybeans which had only a 3% market share the only competitor with the roundup ready cotton was BXN which had about a 3% market share and of course the bow guard trait the insect resistance trait in cotton there's never been a competing product on the market and so far as the record reflects on that so the point is simply that Monsanto has greatly exceeded the patent grant in setting you mean by limiting it to the first user the first farmer and that loan that seeds to be used it's absolutely good that is that is one way in which they did it and the reason that this is not controlled by what the court held in McFarling is there's nothing here that can in this patent any of these four patents that in any way restricts the sale of seed there's no license agreement as you had in McFarland only gene sequences are cleaned in these patents and that's why this is so different from McFarling but the cartel idea that I've just mentioned has been explained very carefully in the expert opinions by Dr. Robert Tollison by Dr
. So the point is that under the 605 patent there's nothing in the claims of that patent that extends to the right to control the seed or the herbicide that's used with the particular product in this instance the trait the roundup ready trait but most important of all there's nothing in the 605 patent and the other three patents that relate to the Bogart cotton that in any way authorizes Monsanto to establish what the lack of a better term is a seed cartel and when I say that I mean that Monsanto has license agreements exemplars of which are in the record that make it very clear that Monsanto has tied up the germ plasma market that is all of the seed companies any I think the expression by one of Monsanto's departments from Mr. Dave Rylander was anybody who is anybody in the seed business has a license with us what that has had the effect of doing of course is accomplishing the vision that set forth in Monsanto's original planning documents which was not just to be able to go into the market and compete with respect to this product that they they claim to have invented but at rather to control the market to the exclusion of all other competing products and in fact they've succeeded because the record reflects that with respect to the three trait products that are involved in this case the roundup ready soybean trait the only other product that's out there as of the close of the record was STS soybeans which had only a 3% market share the only competitor with the roundup ready cotton was BXN which had about a 3% market share and of course the bow guard trait the insect resistance trait in cotton there's never been a competing product on the market and so far as the record reflects on that so the point is simply that Monsanto has greatly exceeded the patent grant in setting you mean by limiting it to the first user the first farmer and that loan that seeds to be used it's absolutely good that is that is one way in which they did it and the reason that this is not controlled by what the court held in McFarling is there's nothing here that can in this patent any of these four patents that in any way restricts the sale of seed there's no license agreement as you had in McFarland only gene sequences are cleaned in these patents and that's why this is so different from McFarling but the cartel idea that I've just mentioned has been explained very carefully in the expert opinions by Dr. Robert Tollison by Dr. E. Nares and Professor Peter Carstensen I think there's a there's a major issue that the district court the number of issues the district court misunderstood one of the important ones has to do with the attribution of the licensees shares of seed sales to Monsanto for purposes of a market analysis and the reason the first place whether there should be attribution is a question of fact that is set forth in in the there's a justice department guideline that says the question turns on whether the license grant or Monsanto is using the license to substantially affect or control price Dr. Ares in his opinion sets forth that as the criteria for attribution and in fact what we have is a case where Monsanto in its planning documents particularly one called the maze team protection plan a 1996 document which we quoted in our briefs makes it very clear that the purpose of the grower license approach that Monsanto implemented was to put Monsanto in a position where it could control the price of the seed to the downstream user that is ultimately the farmer and as a quote also in that plan that they were doing this to avoid putting ourselves at the mercy of the pricing decisions of seed companies it's also very important to understand that in 01 and 02 Monsanto is making important presentations to the investment community and and they're what they're doing is showing their strong market share and they present themselves at both the Roundup Ready traits in soybeans and cotton and of course the insect resistant trick now no excuse this this is just the Roundup Ready trait they present themselves as exceeding the 90 percent level the only way that can be is to include the seed partner shares which is what exactly what judge Pepper says that you should not do in fact the third circuit in remained no the ninth circuit in remained in the Kodak and image services case held that aggregation was proper where the facts showed that the that the aggregation was proper as it is here also there's a third circuit case this name of which escapes me this cited in our brief that recognizes this premise but it is a question of fact and the overwhelming evidence was that Monsanto did have a direct control over the pricing we didn't follow that night circuit case and this circuit did we we had the Xerox case it did not follow that one now on this particular issue I don't believe this court is spoken to it sir and that was the same case though right this was the remain from the US Supreme Court's Eastman Kodak case again this is an issue that is not to my knowledge that addressed in this court in my research if not found any case that addressed the question of aggregation so I would suggest that the market share should be attributed from the C partners directly to the two Monsanto I would suggest the important part of the case that the district court overlooked in its summary judgment consideration was the long series of planning documents from Monsanto where they made exactly clear what it was they were going to try to do and it starts in 1994 with a BT cotton value capture plan the best one in terms of expressing the Monsanto view that has been effectively implemented that shows that they greatly exceeded the patent grant is the project atlas there any I apologize I think my time is up thank you very much thank you very much mr
. E. Nares and Professor Peter Carstensen I think there's a there's a major issue that the district court the number of issues the district court misunderstood one of the important ones has to do with the attribution of the licensees shares of seed sales to Monsanto for purposes of a market analysis and the reason the first place whether there should be attribution is a question of fact that is set forth in in the there's a justice department guideline that says the question turns on whether the license grant or Monsanto is using the license to substantially affect or control price Dr. Ares in his opinion sets forth that as the criteria for attribution and in fact what we have is a case where Monsanto in its planning documents particularly one called the maze team protection plan a 1996 document which we quoted in our briefs makes it very clear that the purpose of the grower license approach that Monsanto implemented was to put Monsanto in a position where it could control the price of the seed to the downstream user that is ultimately the farmer and as a quote also in that plan that they were doing this to avoid putting ourselves at the mercy of the pricing decisions of seed companies it's also very important to understand that in 01 and 02 Monsanto is making important presentations to the investment community and and they're what they're doing is showing their strong market share and they present themselves at both the Roundup Ready traits in soybeans and cotton and of course the insect resistant trick now no excuse this this is just the Roundup Ready trait they present themselves as exceeding the 90 percent level the only way that can be is to include the seed partner shares which is what exactly what judge Pepper says that you should not do in fact the third circuit in remained no the ninth circuit in remained in the Kodak and image services case held that aggregation was proper where the facts showed that the that the aggregation was proper as it is here also there's a third circuit case this name of which escapes me this cited in our brief that recognizes this premise but it is a question of fact and the overwhelming evidence was that Monsanto did have a direct control over the pricing we didn't follow that night circuit case and this circuit did we we had the Xerox case it did not follow that one now on this particular issue I don't believe this court is spoken to it sir and that was the same case though right this was the remain from the US Supreme Court's Eastman Kodak case again this is an issue that is not to my knowledge that addressed in this court in my research if not found any case that addressed the question of aggregation so I would suggest that the market share should be attributed from the C partners directly to the two Monsanto I would suggest the important part of the case that the district court overlooked in its summary judgment consideration was the long series of planning documents from Monsanto where they made exactly clear what it was they were going to try to do and it starts in 1994 with a BT cotton value capture plan the best one in terms of expressing the Monsanto view that has been effectively implemented that shows that they greatly exceeded the patent grant is the project atlas there any I apologize I think my time is up thank you very much thank you very much mr. Waxman thank you you're welcome please the court judge died the two expert reports of Dr. Fulk which is the only patent validity non-infringement expert are found the original report is found on page 4510 of the joint appendix and the supplemental report is on page 14284 of the joint appendix neither one of those reports discusses in any respect unless I've missed it in perusing it the issue of written described I believe the issue of written description at all per se and certainly doesn't address the adequacy or inadequacy of the written description of the combination that is of the chimera that is claimed in the 605 there is the description they didn't below raise the contention that written description wasn't satisfied because three examples in the 605 patent were sufficient to be representative of the whole genus right they did raise it I have to go back and look at the briefing below they certainly raised it as to the promoter sequence and they I believe they raised it as an invalidity issue that is because there was assertively a fragmentation that occurred during the transformation in soybeans as opposed to cotton there was all this confusion about whether the 605 patent actually claims the roundup ready seat or whether there is an entire 35 s promotion sequence and the record there is some confusion I think that pervades even the reply brief the record in this regard is absolutely clear the district judge was entirely correct dr. Oshusky's expert report which can be found at beginning at page 6195 of the joint appendix compares the published sequences by Frank but then all has to do with whether the promoter sequence was was sufficiently described as satisfied written description not as to whether the combination that's correct in the combination issue wasn't raised below I don't believe that it was raised below and I don't believe that it was raised the court can draw its own conclusions about whether it's raised by the blue brief and the gray brief in this case but I believe that this issue of the promoter sequence and whether the promoter that is in the roundup ready gene is in fact claimed is entirely clear from the record that it is there is an intact 35 s promoter from the collie flower no say a virus that initiates transcription of this transgenic gene I don't believe that there is anything in the expert reports to substantiate in any way a nonenablement claim on the combination between the collie description of the written description claim or the enabling claim for that matter I wanted to raise one other issue that comes up in the reply brief that I is not entire responses not entirely clear for the record and then and then address Mr
. Waxman thank you you're welcome please the court judge died the two expert reports of Dr. Fulk which is the only patent validity non-infringement expert are found the original report is found on page 4510 of the joint appendix and the supplemental report is on page 14284 of the joint appendix neither one of those reports discusses in any respect unless I've missed it in perusing it the issue of written described I believe the issue of written description at all per se and certainly doesn't address the adequacy or inadequacy of the written description of the combination that is of the chimera that is claimed in the 605 there is the description they didn't below raise the contention that written description wasn't satisfied because three examples in the 605 patent were sufficient to be representative of the whole genus right they did raise it I have to go back and look at the briefing below they certainly raised it as to the promoter sequence and they I believe they raised it as an invalidity issue that is because there was assertively a fragmentation that occurred during the transformation in soybeans as opposed to cotton there was all this confusion about whether the 605 patent actually claims the roundup ready seat or whether there is an entire 35 s promotion sequence and the record there is some confusion I think that pervades even the reply brief the record in this regard is absolutely clear the district judge was entirely correct dr. Oshusky's expert report which can be found at beginning at page 6195 of the joint appendix compares the published sequences by Frank but then all has to do with whether the promoter sequence was was sufficiently described as satisfied written description not as to whether the combination that's correct in the combination issue wasn't raised below I don't believe that it was raised below and I don't believe that it was raised the court can draw its own conclusions about whether it's raised by the blue brief and the gray brief in this case but I believe that this issue of the promoter sequence and whether the promoter that is in the roundup ready gene is in fact claimed is entirely clear from the record that it is there is an intact 35 s promoter from the collie flower no say a virus that initiates transcription of this transgenic gene I don't believe that there is anything in the expert reports to substantiate in any way a nonenablement claim on the combination between the collie description of the written description claim or the enabling claim for that matter I wanted to raise one other issue that comes up in the reply brief that I is not entire responses not entirely clear for the record and then and then address Mr. Robertson's contentions there is repeated reference to the fact that you know in Argentina and Great Britain in Brazil Monsanto does it another way and collects a royalty from seed savers I want the record to be entirely clear that Monsanto does not sell transgenic genes at all in Great Britain or Brazil or Argentina it tried to in Argentina but since Argentina doesn't extend patent protection to the roundup ready seeds as the GAO report that's included in the joint appendix concludes the rampant black market eliminated Monsanto's ability even to collect a license of fee so there is no the notion that Monsanto has done it another way in other places which is filled in their expert reports is simply incorrect could I move you for a moment that one of the antitrust issues in the allegation that there's time between the trade and the use of roundup and the district courts seem to reject that on the ground that Monsanto could enforce the EPA requirements I would have thought that under fashion originators in the Indiana dentist's case that that is not a permissible use of a tying arrangement what's your comment on that that's not really addressed my comment on the the tie between the herbicide and the seed is that that tie that the restriction that only roundup be used over the top of roundup ready was in fact and was in place in the years 1996 to 1998 when a Monsanto had a patent on glyphosate in the glyphosate formulation and be fifera under the EPA under fifera permitted only roundup to be used over the top of the market but what's the answer is to whether that that EPA requirement can appropriately be enforced by a private party I thought it was pretty clear that it wasn't that was not an appropriate use of a tie for example to enforce an EPA requirement well I'm I first of all there's no issue of enforcement here because it was a license requirement and the one thing that that Mr. Scrux has maintained from the outset is he doesn't have a license he didn't sign a license. He may not have any trust standing but in terms of patent misuse well that seems to be the ground that the district court rejected this patent misuse to defense based on this tying arrangement and the question and he did so for the district court as I read the opinion did so on the ground that no other herbicide would satisfy EPA requirements and it was appropriate for them to enforce that EPA requirement as part of the agreements that they had with the seed producers in the farm
. Robertson's contentions there is repeated reference to the fact that you know in Argentina and Great Britain in Brazil Monsanto does it another way and collects a royalty from seed savers I want the record to be entirely clear that Monsanto does not sell transgenic genes at all in Great Britain or Brazil or Argentina it tried to in Argentina but since Argentina doesn't extend patent protection to the roundup ready seeds as the GAO report that's included in the joint appendix concludes the rampant black market eliminated Monsanto's ability even to collect a license of fee so there is no the notion that Monsanto has done it another way in other places which is filled in their expert reports is simply incorrect could I move you for a moment that one of the antitrust issues in the allegation that there's time between the trade and the use of roundup and the district courts seem to reject that on the ground that Monsanto could enforce the EPA requirements I would have thought that under fashion originators in the Indiana dentist's case that that is not a permissible use of a tying arrangement what's your comment on that that's not really addressed my comment on the the tie between the herbicide and the seed is that that tie that the restriction that only roundup be used over the top of roundup ready was in fact and was in place in the years 1996 to 1998 when a Monsanto had a patent on glyphosate in the glyphosate formulation and be fifera under the EPA under fifera permitted only roundup to be used over the top of the market but what's the answer is to whether that that EPA requirement can appropriately be enforced by a private party I thought it was pretty clear that it wasn't that was not an appropriate use of a tie for example to enforce an EPA requirement well I'm I first of all there's no issue of enforcement here because it was a license requirement and the one thing that that Mr. Scrux has maintained from the outset is he doesn't have a license he didn't sign a license. He may not have any trust standing but in terms of patent misuse well that seems to be the ground that the district court rejected this patent misuse to defense based on this tying arrangement and the question and he did so for the district court as I read the opinion did so on the ground that no other herbicide would satisfy EPA requirements and it was appropriate for them to enforce that EPA requirement as part of the agreements that they had with the seed producers in the farm. Judge, I'm not entirely certain about the state of the record but my understanding is that Monsanto in obtaining EPA approval both for the bull guard seed and for the roundup ready seed had to comply with certain EPA restrictions imposed under Fifra in addition to the patenting issues and one of the conditions was that only properly labeled herbicides or that users growers be instructed in the label that only Fifra approved labeled herbicides be used over the top but in any event that restriction disappeared after 1998. Yeah but there would be a question if it was misuse whether it had dissipated and also it would bear on the ability to recover damages during the 1996 to 1998 period. Well with respect at the most I mean those those provisions are not quote still enforced they were licensed restrictions that apply to the licensed use of seed purchased in those years at most Mr
. Judge, I'm not entirely certain about the state of the record but my understanding is that Monsanto in obtaining EPA approval both for the bull guard seed and for the roundup ready seed had to comply with certain EPA restrictions imposed under Fifra in addition to the patenting issues and one of the conditions was that only properly labeled herbicides or that users growers be instructed in the label that only Fifra approved labeled herbicides be used over the top but in any event that restriction disappeared after 1998. Yeah but there would be a question if it was misuse whether it had dissipated and also it would bear on the ability to recover damages during the 1996 to 1998 period. Well with respect at the most I mean those those provisions are not quote still enforced they were licensed restrictions that apply to the licensed use of seed purchased in those years at most Mr. Scruggs bought ten bags of these seeds without signing any license in 1996 and planted them so what does that have to do with the patent misuse defense if I understand patent misuse the fact that you might not have any trust standing or that you weren't injured individually is is not a reason that the patent misuse defense is an applicant you get if you misuse the patent with respect to other people the Scruggs can still assert a patent misuse defense here right I believe that that is in fact the correct statement of the law my only submission here is I believe that Monsanto was required by EPA to instruct in the use instructions to instruct people only to use EPA approved herbicides over the top in any event as I said the notion of dissups since 1998 for the past eight years there has been no such limitation and I I'm struggling to remember the FTC versus the Indian and dentist I do remember the case I don't recall that there's any I may be wrong but I don't recall that there is a patent misuse issue or a tie issue here that goes to whether compliance with a regulatory requirement by a federal agency over a regulated entity that is Monsanto selling FIFRA approved C transgenic seed could could constitute an antitrust type of event there's no where do I find where do I find in the record how do I how do I know that this is an EPA in post-reform that the C labeling I am I am not even sure I will undertake to look through the record and advise the for I'm not even sure that it's in the record in this case I do know that EPA imposed a number of requirements on Monsanto particularly in the cotton area where it's required to instruct farmers to establish refuges and the sort and I don't know whether it's in the record I I actually can't really bring the whole 32,000 page join appendix to mind my I think our principal submission I don't believe that the argument that enforcement of an EPA requirement or instructions or a licensed condition that only EPA approved herbicides be used over this new technology would constitute patent misuse but I certainly could stand corrected by your honor or this court I I don't think that argument was ever made below or made in this court before the argument has been from the other side will those that restriction may have existed in the 96 to 98 licenses but those licenses continue to be enforced today which of course they don't unless somebody has never planted seed bought in those years but Monsanto's seeking damages against frogs for the 1996 to 1998 period is it not I believe it's night for for for the soybeans I believe it's 1997 through 2000 and for the cotton 1999 and 2000 well at least there's some overlap with the period during which these restraints were in fact that's correct now he says he didn't sign a license he's never claimed to be bound by any of the license provisions and I don't I mean I take your point about there either is or is in patent misuse our submission I think is that it's not that would not have been patent misuse to instruct users as a condition of a license that they only use an herbicide which a itself was patented and covered by a monopoly and there is an interesting legal question about the rules regarding a tie between two patented products and as I said there was certainly a the as the district court construed the license agreement which he didn't sign any of that and claims not to have read it required an effect that if you were going to use glyphosate over the top that you use roundup which was a patented and be the only one that was approved by EPA under Fifre I did want to make one comment about at least about the seed cartel arguments I mean I just stopping for a second on MacFarland the 605 the fact that there are genes and there is not a claim for the seed or the plant I think is absolutely legally irrelevant every single cell in roundup ready seed and a roundup ready plant contains the transgenic gene that is covered by the 605 patent and in fact in MacFarland too the only patent the only patent infringement claim that was a duty that had been adjudicated in that case was the 605 patent it's quite true that this court issued an opinion that responded in a footnote to a claim by Mr. MacFarland that the 435 patent was invalid and the court rejected that because that claim hadn't been made before but it was actually the 605 patent that had been adjudicated to have been infringed and the notion that that was a contract breach action and not a direct infringement action can't be in any way relevant because it was patent misuse that is the alleged tie between the trait and the germplasm that was alleged to be the patent misuse in that case and this court said quite properly that in the context of products like seeds which produce copies of themselves quote licensing restraints on the use of goods produced by the licensed product are not beyond the scope of the patent grant and that is equally true whether the claim whether the patent covers every cell in the seed or the plant or the plant or the seed itself now as to the cartel allegations in this case there is absolutely no evidence in this case whatever one thinks about the relevant markets or market power or anything like that there is absolutely no evidence in this case of any agreement between Monsanto and the 300 different seed companies that are licensed to produce both conventional varieties and round-up ready varieties or any bad act that Monsanto took that caused seed companies to raise prices Monsanto sets a price for its technology fee and it does not restrain in any way what seed companies charge for seed and the record shows that among varieties there is very great variation thank you thank you sir the case is a minute
Work on 5, 3, 2, 11, 20, and 11, 21. My final company be shrugs. Dr. Robertson. May I please court Jimmy Robertson from Jackson, Mississippi, and represent the Scrubs of Helles, who are appealing three separate summary judgment, said with granted in the United States District Court for the Northern District of Mississippi. I'd like to begin by emphasizing the reasons why the second opinion of this court in my Santo versus McFarling is not controlling here in any important particular. And those reasons are first that opinion makes very clear that it's predicated upon the 435 patent. It corrected very clearly a mistake or a slip of the tongue for like a better way of expressing from the first Monsanto opinion that said that the patents read on seeds and plants, not so in the 605 patent, which is all that's left in this case. The 435 patent, which did include seeds and plants, is not involved in this case. The second distinction between that case and this case is the first, the McFarling case was strongly influenced by the fact that the farmer had signed a technology agreement with Monsanto, not so here. That's the reason the case was in Mississippi instead of in St. Louis. There is no Monsanto technology agreement here. Third, by far the most important is in this case, the Scrubs of Helles presented to the District Court, all of the proofs that the court said were lacking in the Monsanto case. Not only was there substantial evidence on each of the important points that showed that there were more than just genuine issues of material fact that were strongly supported by expert opinions from Professor Ian Ayers, Yale and antitrust economist Professor Peter Carstensen from Wisconsin and antitrust economist with particular experience in agricultural markets. Professor Robert Tullison and Clemson, who is a cartel specialist professor David Parvin, who is a Mississippi agricultural economist and of course having to do with the patent validity issues to begin with. Dr. William Folk from the University of Missouri, who is a plant molecular biologist who presented a very important and credible two affidavits and expert reports that establish that with respect to the patents that are in issue in this case, one taking the specification could not reproduce the inventions that are claimed in the patents and therefore at the very least there is a question fact with regard to the issues of patent validity. What did your experts say about written description? Was there any contention made about written description below that the three examples in the 605 patent were insufficient to describe the entire genus? Yes, and the one that was not talking about the genus, whether it was sufficient to describe the promoter sequences from the cauliflower virus, but whether the combination of the promoter sequences with other genetic material was sufficiently described because of my understanding is that the 605 patent are only three examples given of that combination. You are on a smart recollection that two of those examples had to do with the 19S patent instead of the 35S patent and so the patent claims the 35S and the 19S. The 19S is not in involved in this case. So you only have one that is actually related to this case. Yes, Dr. Folk went through the written description analysis and presented an opinion that I think is very much supported by the evidence, supported by peer review literature. But opinion about what? I'm not asking you about whether the promoter sequence of the cauliflower virus was sufficiently described. I'm asking you a different question. I'm really asking whether this was raised at all and that is the question of whether the combination of the promoter sequence with other genetic material, which is the subject of this patent was adequately described. And my understanding is that there are only three examples of that given in the specification of the 605 patent. You honor my best recollection of Dr. Folk's opinion is that he did consider the entire specification and did offer an opinion that one skilled in the art could not take the specification under the written description test and understand that the invention was in the possession of the inventors and he made the same opinions with respect to the enablement requirement of section one 12 as well. So I would answer your question yes, Your Honor. The Dr. Folk did make those representations and explain those in his opinions. His original opinion filed in February of 02 a supplemental opinion. Where do I find that he addressed that particular point? I do not have that in my fingertip's honor. Okay. With respect to the the the 605 patent does not claim plants and seeds and I think it's very important to understand that because of that the patent grant that is was important in my calling case and is important to the district court does not extend to a number of the claims and activities that Monsanto was involved in in this case specifically the 605 patent has is nothing in it that shows that Monsanto has any rights with respect to the roundup or glyphosate herbicides. We presented substantial evidence that there is either tying or bundling or leveraging or whatever you want to call it and I suggest that that is an instance where Monsanto has exceeded the patent grant. A second one has to do in this gift this is the issue in Mac Farley in a sense having to do with the tie between the trait the transgenic trait the claimed in the 605 patent the roundup ready trait and the seed itself. Now it emphasized that Monsanto has no rights in the seed itself in fact those seeds the germ plasm was produced by the seed partners. I think it's important to understand that Monsanto set this up in their system from the beginning as two separate products even though they are physically together. Monsanto may clear in a 1999 memorandum to the justice department having to do with the then proposed acquisition of Delta and Pine Land Company that it was only in the trait market it was not in the seed market itself and in fact in that in support of that position Monsanto's many planning documents set up the proposition that the seed and the trait are two separate products. The trait is always owned by Monsanto it is licensed to the farmer for a technology fee the seed itself is owned by the seed company which is also a seed partner a licensee of Monsanto and it in turn sells the seed in its downstream channel to the farmer itself. So the point is that under the 605 patent there's nothing in the claims of that patent that extends to the right to control the seed or the herbicide that's used with the particular product in this instance the trait the roundup ready trait but most important of all there's nothing in the 605 patent and the other three patents that relate to the Bogart cotton that in any way authorizes Monsanto to establish what the lack of a better term is a seed cartel and when I say that I mean that Monsanto has license agreements exemplars of which are in the record that make it very clear that Monsanto has tied up the germ plasma market that is all of the seed companies any I think the expression by one of Monsanto's departments from Mr. Dave Rylander was anybody who is anybody in the seed business has a license with us what that has had the effect of doing of course is accomplishing the vision that set forth in Monsanto's original planning documents which was not just to be able to go into the market and compete with respect to this product that they they claim to have invented but at rather to control the market to the exclusion of all other competing products and in fact they've succeeded because the record reflects that with respect to the three trait products that are involved in this case the roundup ready soybean trait the only other product that's out there as of the close of the record was STS soybeans which had only a 3% market share the only competitor with the roundup ready cotton was BXN which had about a 3% market share and of course the bow guard trait the insect resistance trait in cotton there's never been a competing product on the market and so far as the record reflects on that so the point is simply that Monsanto has greatly exceeded the patent grant in setting you mean by limiting it to the first user the first farmer and that loan that seeds to be used it's absolutely good that is that is one way in which they did it and the reason that this is not controlled by what the court held in McFarling is there's nothing here that can in this patent any of these four patents that in any way restricts the sale of seed there's no license agreement as you had in McFarland only gene sequences are cleaned in these patents and that's why this is so different from McFarling but the cartel idea that I've just mentioned has been explained very carefully in the expert opinions by Dr. Robert Tollison by Dr. E. Nares and Professor Peter Carstensen I think there's a there's a major issue that the district court the number of issues the district court misunderstood one of the important ones has to do with the attribution of the licensees shares of seed sales to Monsanto for purposes of a market analysis and the reason the first place whether there should be attribution is a question of fact that is set forth in in the there's a justice department guideline that says the question turns on whether the license grant or Monsanto is using the license to substantially affect or control price Dr. Ares in his opinion sets forth that as the criteria for attribution and in fact what we have is a case where Monsanto in its planning documents particularly one called the maze team protection plan a 1996 document which we quoted in our briefs makes it very clear that the purpose of the grower license approach that Monsanto implemented was to put Monsanto in a position where it could control the price of the seed to the downstream user that is ultimately the farmer and as a quote also in that plan that they were doing this to avoid putting ourselves at the mercy of the pricing decisions of seed companies it's also very important to understand that in 01 and 02 Monsanto is making important presentations to the investment community and and they're what they're doing is showing their strong market share and they present themselves at both the Roundup Ready traits in soybeans and cotton and of course the insect resistant trick now no excuse this this is just the Roundup Ready trait they present themselves as exceeding the 90 percent level the only way that can be is to include the seed partner shares which is what exactly what judge Pepper says that you should not do in fact the third circuit in remained no the ninth circuit in remained in the Kodak and image services case held that aggregation was proper where the facts showed that the that the aggregation was proper as it is here also there's a third circuit case this name of which escapes me this cited in our brief that recognizes this premise but it is a question of fact and the overwhelming evidence was that Monsanto did have a direct control over the pricing we didn't follow that night circuit case and this circuit did we we had the Xerox case it did not follow that one now on this particular issue I don't believe this court is spoken to it sir and that was the same case though right this was the remain from the US Supreme Court's Eastman Kodak case again this is an issue that is not to my knowledge that addressed in this court in my research if not found any case that addressed the question of aggregation so I would suggest that the market share should be attributed from the C partners directly to the two Monsanto I would suggest the important part of the case that the district court overlooked in its summary judgment consideration was the long series of planning documents from Monsanto where they made exactly clear what it was they were going to try to do and it starts in 1994 with a BT cotton value capture plan the best one in terms of expressing the Monsanto view that has been effectively implemented that shows that they greatly exceeded the patent grant is the project atlas there any I apologize I think my time is up thank you very much thank you very much mr. Waxman thank you you're welcome please the court judge died the two expert reports of Dr. Fulk which is the only patent validity non-infringement expert are found the original report is found on page 4510 of the joint appendix and the supplemental report is on page 14284 of the joint appendix neither one of those reports discusses in any respect unless I've missed it in perusing it the issue of written described I believe the issue of written description at all per se and certainly doesn't address the adequacy or inadequacy of the written description of the combination that is of the chimera that is claimed in the 605 there is the description they didn't below raise the contention that written description wasn't satisfied because three examples in the 605 patent were sufficient to be representative of the whole genus right they did raise it I have to go back and look at the briefing below they certainly raised it as to the promoter sequence and they I believe they raised it as an invalidity issue that is because there was assertively a fragmentation that occurred during the transformation in soybeans as opposed to cotton there was all this confusion about whether the 605 patent actually claims the roundup ready seat or whether there is an entire 35 s promotion sequence and the record there is some confusion I think that pervades even the reply brief the record in this regard is absolutely clear the district judge was entirely correct dr. Oshusky's expert report which can be found at beginning at page 6195 of the joint appendix compares the published sequences by Frank but then all has to do with whether the promoter sequence was was sufficiently described as satisfied written description not as to whether the combination that's correct in the combination issue wasn't raised below I don't believe that it was raised below and I don't believe that it was raised the court can draw its own conclusions about whether it's raised by the blue brief and the gray brief in this case but I believe that this issue of the promoter sequence and whether the promoter that is in the roundup ready gene is in fact claimed is entirely clear from the record that it is there is an intact 35 s promoter from the collie flower no say a virus that initiates transcription of this transgenic gene I don't believe that there is anything in the expert reports to substantiate in any way a nonenablement claim on the combination between the collie description of the written description claim or the enabling claim for that matter I wanted to raise one other issue that comes up in the reply brief that I is not entire responses not entirely clear for the record and then and then address Mr. Robertson's contentions there is repeated reference to the fact that you know in Argentina and Great Britain in Brazil Monsanto does it another way and collects a royalty from seed savers I want the record to be entirely clear that Monsanto does not sell transgenic genes at all in Great Britain or Brazil or Argentina it tried to in Argentina but since Argentina doesn't extend patent protection to the roundup ready seeds as the GAO report that's included in the joint appendix concludes the rampant black market eliminated Monsanto's ability even to collect a license of fee so there is no the notion that Monsanto has done it another way in other places which is filled in their expert reports is simply incorrect could I move you for a moment that one of the antitrust issues in the allegation that there's time between the trade and the use of roundup and the district courts seem to reject that on the ground that Monsanto could enforce the EPA requirements I would have thought that under fashion originators in the Indiana dentist's case that that is not a permissible use of a tying arrangement what's your comment on that that's not really addressed my comment on the the tie between the herbicide and the seed is that that tie that the restriction that only roundup be used over the top of roundup ready was in fact and was in place in the years 1996 to 1998 when a Monsanto had a patent on glyphosate in the glyphosate formulation and be fifera under the EPA under fifera permitted only roundup to be used over the top of the market but what's the answer is to whether that that EPA requirement can appropriately be enforced by a private party I thought it was pretty clear that it wasn't that was not an appropriate use of a tie for example to enforce an EPA requirement well I'm I first of all there's no issue of enforcement here because it was a license requirement and the one thing that that Mr. Scrux has maintained from the outset is he doesn't have a license he didn't sign a license. He may not have any trust standing but in terms of patent misuse well that seems to be the ground that the district court rejected this patent misuse to defense based on this tying arrangement and the question and he did so for the district court as I read the opinion did so on the ground that no other herbicide would satisfy EPA requirements and it was appropriate for them to enforce that EPA requirement as part of the agreements that they had with the seed producers in the farm. Judge, I'm not entirely certain about the state of the record but my understanding is that Monsanto in obtaining EPA approval both for the bull guard seed and for the roundup ready seed had to comply with certain EPA restrictions imposed under Fifra in addition to the patenting issues and one of the conditions was that only properly labeled herbicides or that users growers be instructed in the label that only Fifra approved labeled herbicides be used over the top but in any event that restriction disappeared after 1998. Yeah but there would be a question if it was misuse whether it had dissipated and also it would bear on the ability to recover damages during the 1996 to 1998 period. Well with respect at the most I mean those those provisions are not quote still enforced they were licensed restrictions that apply to the licensed use of seed purchased in those years at most Mr. Scruggs bought ten bags of these seeds without signing any license in 1996 and planted them so what does that have to do with the patent misuse defense if I understand patent misuse the fact that you might not have any trust standing or that you weren't injured individually is is not a reason that the patent misuse defense is an applicant you get if you misuse the patent with respect to other people the Scruggs can still assert a patent misuse defense here right I believe that that is in fact the correct statement of the law my only submission here is I believe that Monsanto was required by EPA to instruct in the use instructions to instruct people only to use EPA approved herbicides over the top in any event as I said the notion of dissups since 1998 for the past eight years there has been no such limitation and I I'm struggling to remember the FTC versus the Indian and dentist I do remember the case I don't recall that there's any I may be wrong but I don't recall that there is a patent misuse issue or a tie issue here that goes to whether compliance with a regulatory requirement by a federal agency over a regulated entity that is Monsanto selling FIFRA approved C transgenic seed could could constitute an antitrust type of event there's no where do I find where do I find in the record how do I how do I know that this is an EPA in post-reform that the C labeling I am I am not even sure I will undertake to look through the record and advise the for I'm not even sure that it's in the record in this case I do know that EPA imposed a number of requirements on Monsanto particularly in the cotton area where it's required to instruct farmers to establish refuges and the sort and I don't know whether it's in the record I I actually can't really bring the whole 32,000 page join appendix to mind my I think our principal submission I don't believe that the argument that enforcement of an EPA requirement or instructions or a licensed condition that only EPA approved herbicides be used over this new technology would constitute patent misuse but I certainly could stand corrected by your honor or this court I I don't think that argument was ever made below or made in this court before the argument has been from the other side will those that restriction may have existed in the 96 to 98 licenses but those licenses continue to be enforced today which of course they don't unless somebody has never planted seed bought in those years but Monsanto's seeking damages against frogs for the 1996 to 1998 period is it not I believe it's night for for for the soybeans I believe it's 1997 through 2000 and for the cotton 1999 and 2000 well at least there's some overlap with the period during which these restraints were in fact that's correct now he says he didn't sign a license he's never claimed to be bound by any of the license provisions and I don't I mean I take your point about there either is or is in patent misuse our submission I think is that it's not that would not have been patent misuse to instruct users as a condition of a license that they only use an herbicide which a itself was patented and covered by a monopoly and there is an interesting legal question about the rules regarding a tie between two patented products and as I said there was certainly a the as the district court construed the license agreement which he didn't sign any of that and claims not to have read it required an effect that if you were going to use glyphosate over the top that you use roundup which was a patented and be the only one that was approved by EPA under Fifre I did want to make one comment about at least about the seed cartel arguments I mean I just stopping for a second on MacFarland the 605 the fact that there are genes and there is not a claim for the seed or the plant I think is absolutely legally irrelevant every single cell in roundup ready seed and a roundup ready plant contains the transgenic gene that is covered by the 605 patent and in fact in MacFarland too the only patent the only patent infringement claim that was a duty that had been adjudicated in that case was the 605 patent it's quite true that this court issued an opinion that responded in a footnote to a claim by Mr. MacFarland that the 435 patent was invalid and the court rejected that because that claim hadn't been made before but it was actually the 605 patent that had been adjudicated to have been infringed and the notion that that was a contract breach action and not a direct infringement action can't be in any way relevant because it was patent misuse that is the alleged tie between the trait and the germplasm that was alleged to be the patent misuse in that case and this court said quite properly that in the context of products like seeds which produce copies of themselves quote licensing restraints on the use of goods produced by the licensed product are not beyond the scope of the patent grant and that is equally true whether the claim whether the patent covers every cell in the seed or the plant or the plant or the seed itself now as to the cartel allegations in this case there is absolutely no evidence in this case whatever one thinks about the relevant markets or market power or anything like that there is absolutely no evidence in this case of any agreement between Monsanto and the 300 different seed companies that are licensed to produce both conventional varieties and round-up ready varieties or any bad act that Monsanto took that caused seed companies to raise prices Monsanto sets a price for its technology fee and it does not restrain in any way what seed companies charge for seed and the record shows that among varieties there is very great variation thank you thank you sir the case is a minut