Legal Development Updates

January 22, 2002

The United States Supreme Court, state courts, and a federal district court recently decided cases of interest to seed companies. In addition, the North Dakota's Seed Arbitration Board has issued a proposal to revise the requirements regarding seed arbitration.

The U.S. Supreme Court rejected arguments by an agricultural supply business that federal patent law does not provide for the grant of utility patents for plants and seeds. The Court upheld the validity of countless seed-related patents in finding that neither the Plant Variety Protection Act, nor the Plant Patent Act, precludes the grant of utility patents for plants and seeds. In this crucial decision, the American Seed Trade Association wrote an amicus curiae brief in support of the seed industry's position.

In North Dakota, the State Supreme Court rejected arguments by a seed company that the state's consumer fraud act only applies to consumer transactions. Specifically, the court found that the statute applies to the purchase of seeds by farmers for the cultivation and subsequent sale of the resultant crops.

In a case pending before the Federal Circuit, petitioners are appealing a federal district court's decision invalidating patents involving the method and process of identifying, germinating, and harvesting the sprouts of certain cruciferous seeds at a specific stage in growth when certain cancer-fighting substances are present in the food at high levels. Petitioner originally brought suit against producers of sprouts alleging patent infringement for the growth and harvesting of certain cruciferous sprouts without a license. The federal district court held that the patents were invalid by anticipation because the method of growing, harvesting, and consuming these sprouts has been well-known for decades.

In Mississippi, a state appellate court upheld a trial court's finding that seeds sold by the defendant seed company were infected with a virus and, therefore, sold in breach of the implied warranty of merchantability because they were not disease-resistant, and produced low crop yields. The appellate court rejected the defendant's argument that the trial court abused its discretion in finding the presence of disease in the seeds without confirmation by laboratory testing.

In North Dakota, the State's Seed Arbitration Board has issued a proposal to revise its procedures concerning seed arbitration. The proposal would eliminate seed arbitration as a prerequisite to filing a civil action.

Click on links below for summaries of the cases and proposed rule:

Pioneer Hi-Bred International v. J.E.M. Ag Supply, Inc.

Jorgenson v. Agway, Inc.

Cruciferous Sprout Patent Litigation

Jacob Hartz Seed Company, Inc. v. Simrall and Simrall, a Partnership

North Dakota Seed Arbitration Board: Notice of Proposed Rulemaking Regarding Seed Arbitration