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Monsanto Co., the world’s biggest seed company, can’t use a European patent on its Roundup Ready soybeans to block Argentinean soy meal imports, the European Union’s highest court said.
The ruling by the European Court of Justice in Luxembourg follows Monsanto’s decision last month to withdraw a Dutch suit that triggered the EU court case. Tuesday’s decision is binding across the 27 EU nations and can’t be appealed.
“Monsanto cannot prohibit the marketing in the EU of soy meal containing, in a residual state, a DNA sequence,” it patented, the EU court said Tuesday.
Monsanto said last week its decision to settle the Dutch dispute was prompted by a preliminary opinion in March. The EU court Tuesday agreed with the non-binding decision of its Advocate General Paolo Mengozzi that the European patent for the trait that makes soybeans resistant to the company’s Roundup herbicide doesn’t extend to soy meal made from the patented seeds.
“This is another blow to Monsanto, which is the more painful as it probably thought it was off the hook after having settled the Dutch case,” said Stijn Debaene, a partner at Field Fisher Waterhouse in Brussels. “Monsanto cannot invoke its patent rights to enjoin someone from importing or using materials containing residues of Monsanto’s patented genetic information.”
Argentine growers planted about 43 million acres of soybeans containing Monsanto’s Roundup Ready trait last year, making the country the company’s second-biggest soybean market after the U.S., according to a Monsanto report. About 95 percent of soybeans grown in Argentina contain Monsanto’s Roundup Ready trait, Jim Tobin, the company’s vice president of industry affairs said in July.
“The case itself has already been settled between the two parties and this move in no way affects the outcome,” St. Louis-based Monsanto said in an e-mailed statement. “This ruling has only a limited meaning for the patent involved. Overall patent protection of Monsanto’s Roundup Ready Soybean is not at issue.”
Monsanto said Argentina is “the correct place for a resolution in these matters” and it will continue to work on a fair solution.
Shares of the company Tuesday fell $1.42, or 3 percent, to $45.12 in New York Stock Exchange trading after earlier touching a 52-week low of $44.76. The shares have fallen 45 percent so far this year.
A Dutch court on June 23 granted Monsanto’s request to withdraw its lawsuit against Cefetra Ltd. and Alfred C. Toepfer International. Toepfer is a unit of Archer Daniels Midland Co.
The decision “is exactly in line with the position as advocated by Cefetra,” said John Allen, who represented Cefetra before the EU court. “It takes into account the circumstances of the case and still leaves room for a fair biotech patent protection in Europe.”
During 2005 and 2006, Monsanto had shipments of soy meal from Argentina impounded in Amsterdam. Tests showed they contained some of the patented seed traits and Monsanto sued the importers for infringement. A court in The Hague sought the EU tribunal’s guidance on the case in 2008.
While Monsanto had argued the patented trait in the soybeans remains under its protection after the beans have been processed into meal, the importers argued the patent’s scope isn’t that wide under EU biotechnology rules.
The EU court case is C-428/08 Monsanto Technology LLC v. Cefetra BV, Cefetra Feed Service BV, Cefetra Futures BV and State of Argentina and Monsanto Technology LLC v. Vopak Agencies Rotterdam BV and Alfred C. Toepfer International GmbH.
-With assistance from Andrew M. Harris in Chicago.
