A Division Bench of the Delhi High Court recently pronounced its judgment in the long running litigation between Monsanto and Nuziveedu. The present judgment was delivered in cross appeals filed by both parties against the order of a single judge of the Delhi High Court that was delivered last year.
To describe the judgment briefly, the court has delivered a knock-out punch to Monsanto, by declaring invalid its patent for Bt. Technology because Section 3(j) of the Patents Act prohibited the grant of patents for plants, plant varieties or seeds or any part thereof. The court however does give three months to Monsanto to seek protection for its invention under the Plant Variety Protection & Farmer’s Rights Act, 2002. (I’ll deal with this issue in a later post)
The judgment is extraordinary because the usual remit of an appeals court is to review whether the trial court has abused its discretion. In this case, the trial court had refused to comment on the validity of Monsanto’s patent preferring to wait for the trial to conclude – this is a rather sensible course of action in patent cases involving complex issues of technology. However, in this case, the Division Bench has delivered a final judgment revoking the patent because Monsanto apparently agreed to waive its right to a trial and have the Division Bench decide the issue of patent validity once in for all. Monsanto’s decision to waive its right to trial on the issue of patent validity is one that can be described as either incredibly brave or incredibly over-confident. Trials give the opportunity to present expert witnesses and more importantly cross-examine witnesses from the other side to force admissions beneficial to your case. I cannot fathom why Monsanto would give up its right to a trial in such a complicated case. I also fail to understand how a court could revoke a patent without any “evidence”. At the very least the court should have asked for expert witness affidavits from both sides and then proceeded to decide the case using the affidavits as evidence.
The Patent & Section 3(j)
The patent in question in this case was 214436 titled ‘Methods for transforming plants to express bacillus thuringiensis deltaendotoxins’. Monsanto had claimed infringement of Claim 25 and two other claims that were dependent on 25. I reproduce claim 25 as follows:
A nucleic acid sequence comprising a promoter operably linked to a first polynucleotide sequence encoding a plastid transit peptide, which is linked in frame to a second polynucleotide sequence encoding a Cry2Ab Bacillus thuringiensis 8-endotoxin protein, wherein expression of said nucleic acid sequence by a plant cell produces a fusion protein comprising an amino-terminal plastid transit peptide covalently linked to said 5- endotoxin protein, and wherein said fusion protein functions to localize said 5-endotoxin protein to a subcellular organelle or compartment
Translated into simple English, the claim covers a selected genetic sequence from a particular bacteria/micro-organism called Bacillus thuringiensis (bt) which when modified and inserted into a plant cell would produce a toxin that would repel pests like the boll worm.
The question before the court was whether this patent was valid in light of the statutory bar, in Section 3(j) of the Patents Act, against the patenting of plants and essentially biological material.
In specific, Section 3(j) prohibits the grant of patents for the following subject matter:
“(j) plants and animals in whole or any part thereof other than micro-organisms but including seeds, varieties and species and essentially biological processes for production or propagation of plants and animals”
The notable exception that is embedded in the section is “micro-organisms”. This exception was the cause of significant heartburn in 2005 when the CPI(M) and others vociferously objected to the granting of patents for micro-organisms. The government then set up the Mashelkar committee to examine whether India would be in violation of its TRIPS commitments if it excluded the grant of patents for micro-organisms. Article 27.3 of the Agreement requires all contracting parties to grant patents for micro-organisms and micro-biological processes. At the time, the Mashelkar committee concluded that India would be in violation of Article 27.3 if it excluded patent protection for micro-organisms. As a result, Section 3(j) remained untouched and the Patent Office has been allowing patent applications that claimed genetic sequences of micro-organisms.
In the agro-biotech sector, the prevalent practice has been to file a patent application claiming an entire transgenic plant and when faced with an objection by the Patent Office on the grounds that Section 3(j) disallowed patents for plants, the patentee would respond by rewording the claims to direct them towards claiming a genetic sequence of a micro-organism as placed at a specific location in the plant genome – the strategy worked and the patents were granted by the Patent Office.
The claim construction problem
Any judgment deciding the validity of a patent has to begin with interpreting the claims at dispute in order to determine the subject matter being claimed by the patentee. It is only after this that a patentee can decide whether this subject matter was patentable and passed the test of novelty, inventive step and industrial application. The Division Bench interprets the claims in paragraph 67 as follows:
Subsequent correspondence between the Patent office and Monsanto resulted in exclusion of plants, plant cells, tissues and progeny plant containing the nucleic acid sequence as well as plants created through an essentially biological process (excluded on account of Section 3(j)). This narrowing of the patent claims, in the opinion of the court, is relevant, because ultimately what was granted was not a patent over the product, or even the method, but of identification of the “event” i.e. the place in the genetic sequence of the DNA where the CryAB2 protein, in the plant cell.
I don’t think the court’s claim construction is correct. A patent can be granted only over a product or process/method – in this case it isn’t clear what the court means when it says that the patent was not granted for a “product” or “method” but for a “place in the genetic sequence of the DNA”. As explained earlier, the patent in question has been granted for a genetic sequence of a micro-organism as placed at a specific location in the genome of the cotton plant. The claim therefore has two components – selection of a particular genetic sequence of a micro-organism (the equivalent of a product) and second, its placement in a particular location of the cotton genome where it will be most effective in producing a toxin (the equivalent of a process).
Claim construction is a threshold issue that determines the outcome of the rest of the case because it helps in identifying the invention that is the subject of the patent. The court’s claim construction in this case fails to accurately identify the invention at dispute and hence the rest of its analysis falters.
The validity analysis
The court’s conclusion regarding the validity of the patent can be found at paragraph 98 – 100 where the court declares Monsanto’s patent to be invalid because it is seeking a patent over “an essentially biological process” which is also proscribed under Section 3(j) of the Patents Act. I extract the relevant lines from para 100:
In other words, the moment the DNA containing the nucleotide sequence (subject patent) is hybridized to produce the transgenic seeds/plants; the seeds/plants fall within the purview of the PV Act, and, above, the process of creation of such seeds/plants are also excluded from patentability as they squarely fall within the meaning of an “essentially biological process” that is exempted from patentability within the meaning of section 3(j), as well. For these reasons, it is held that the subject matter, the concerned nucleotide sequence over which Monsanto has patent rights and the process is unpatentable by reason of Section 3 (j) of the Patents Act.
Translated into simple English, the court is saying that once the DNA containing the patented genetic sequence is hybridized to produce the transgenic seeds/plant, the resultant invention could only be protected under the PVPFRA Act and that the process of creation of such transgenic seeds or plant are excluded from patentability as the same is an “essentially biological process” which is also proscribed under Section 3(j).
I think the entire conclusion of the court is incorrect. Let me start with the second assertion. The transfer of genes from one species to another species can take place naturally (albeit at a painfully slow process spanning generations) but in the case of Monsanto’s patent, the introgression of specific Bt. bacteria genes into the cotton genome took place only due to human intervention. It did not take place naturally. This is quite clear from the court’s description of the Bt. technology that can be found from paragraphs 62 to 67. The description makes it evidently clear that the technology is a result of human intervention and going by this court’s own definition, “essentially biological process” covers only those processes that take place naturally without any human intervention.
So why then does the court declare the entire process to be an “essentially biological process”?
Similarly, the court’s first assertion, that “the moment the DNA containing the nucleotide sequence (subject patent) is hybridized to produce the transgenic seeds/plants; the seeds/plants fall within the purview of the PV Act” is inconsequential because the patentee dropped its claims over a plant after the patent office raised a Section 3(j) objection. The patent claim is now limited to a selected genetic sequence as inserted into a plant genome and not a plant. The issue of whether a transgenic variety can be protected under the PVP Act is simply irrelevant to determining the validity of the patent. That is not a ground to revoke a patent.
These flaws in the judgments could have been avoided with better claim construction.
Certificate of appeal granted
The court has granted a certificate of leave to appeal on the grounds that the case raises a substantial question of law. This means that the Supreme Court will have to admit the appeal for a hearing.