“This is a fascinating case”, Justice Rohinton Nariman in Monsanto Bt Cotton Patent appeal

A battery of Senior Advocates appeared in the Supreme Court today in the appeal filed by Monsanto against a verdict of Delhi High Court which had held that Monsanto Technologies’ patent claim on its Bt cotton seed varieties is unenforceable in India..The matter was heard by a Bench of Justices Rohinton Nariman and AM Sapre..Senior Advocates Mukul Rohatgi, Abhishek Manu Singhvi, Neeraj Kishan Kaul and SN Mookerjee appeared for Monsanto. They were instructed by advocates Rishi Agrawala, Adarsh Ramanujan, Shantanu Agarwal and Karan Luthra..The respondent, Nuziveedu Seeds was represented by Senior Advocates Aryama Sundaram, Jayant Bhushan, and KV Viswanathan..When the matter came up Justice Rohinton Nariman remarked at the outset,.“This is a fascinating case. We have to see not only the history of patents but also the Patent Act.”.The Bench also remarked on the necessity of evidence to ascertain the patentability of Monsanto’s technology..The Court issued notice to Nuziveedu but refused to stay the Delhi High Court verdict. The Court then posted the case for July 18 to hear the parties on the prayer for interim relief..The case has its genesis in sub-license agreements between Monsanto Technology LLC and Nuziveedu Seeds Ltd under which the former sold seeds to the latter. In turn, Nuziveedu had to pay royalties for the use of such donor seeds..Nuziveedu used these donor seeds received from Monsanto in its breeding program to inherit the Bt cotton trait. According to Nuziveedu, the Bt cotton plant varieties developed by it have their own distinct characteristics and are different from the donor seeds variety initially provided by Monsanto..It argued that the gene or the method of transformation was not transferred to them and only seeds of the transgenic variety were given..Monsanto, on the other hand, claimed that since the donor seeds (produced by their own patented technology) were used by Nuziveedu to develop new varieties, they should continue paying royalties as per the original sub-licensing agreement..Monsanto sought for an ad interim injunction against Nuziveedu, claiming that the cause of action arose on account of the Nuziveedu companies continuing to ‘market and sell’ the genetically modified hybrid cotton planting seeds despite termination of the sub-license agreements..Monsanto stated that its patented cotton variety is a biotech invention which eradicates pests afflicting the cotton plant. It stated that the patent does not cover plants per se, but does cover components that can be termed microbiological processes and microorganisms, thus patentable under the Patents Act..The government had introduced certain guidelines, which put a cap on the maximum retail price of the seeds being sub-licensed by Monsanto, after which the company terminated its sub-licensing agreements and approached the Single Judge Bench of the Delhi High Court seeking compensation..Nuziveedu also filed a counterclaim against Monsanto before the Delhi High Court, challenging the termination of the sub-licensing agreement..The Single Bench of Justice RK Gauba had held that Monsanto had wrongfully terminated the sub-license agreement for sale of its patented Bt Cotton seeds. The Court had further directed the company to continue supplying Bt cotton donor seeds under the 2015 sub-license agreements..However, the Single Judge Bench had rejected Nuziveedu’s plea that Monsanto did not have a patent over the seed varieties. Subsequently, both Monsanto and Nuziveedu approached the Division Bench of the High Court by filing cross-appeals..The Division Bench of Justices S Ravindra Bhat and Yogesh Khanna went on to hold that transgenic plants with the integrated Bt. Trait, produced by hybridization, are excluded from patentability within the purview of section 3(j), and Monsanto cannot assert patent rights over the gene that has thus been integrated into the generations of transgenic plants..It also held that the subject patent falls within the exclusion under Section 3 (j) of the Patents Act, and therefore the subject patent and the claims covered by it were unpatentable..The order of the Single Judge directing Monsanto to continue with its obligations under the sub-license agreements was upheld by the Division Bench. However, the Court allowed Monsanto to proceed with respect to the claim for damages in light of the sub-license termination notices issued..Monsanto then moved the Supreme Court against this decision..Read the order passed by Supreme Court below.