Organic Seed Growers and Trade Association et al v. Monsato Company et al
Filing
53
MEMORANDUM AND ORDER granting 19 Motion to Dismiss for Lack of Jurisdiction. The motion (docket no. 19) is granted. (Signed by Judge Naomi Reice Buchwald on 2/24/2012) Copies Mailed By Chambers. (ft)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------X
ORGANIC
SEED
GROWERS
AND
TRADE
ASSOCIATION; ORGANIC CROP IMPROVEMENT
ASSOCIATION INTERNATIONAL, INC.; OCIA
RESEARCH
AND
EDUCATION
INC.;
THE
CORNUCOPIA
INSTITUTE;
DEMETER
ASSOCIATION,
INC.;
CENTER
FOR
FOOD
SAFETY;
BEYOND
PESTICIDES;
NAVDANYA
INTERNATIONAL; MAINE ORGANIC FARMERS AND
GARDENERS ASSOCIATION; NORTHEAST ORGANIC
FARMING
ASSOCIATION
OF
NEW
YORK;
NORTHEAST
ORGANIC
FARMING
ASSOCIATION/MASSACHUSETTS CHAPTER, INC.;
NORTHEAST ORGANIC FARMING ASSOCIATION OF
NEW HAMPSHIRE; NORTHEAST ORGANIC FARMING
ASSOCIATION OF RHODE ISLAND; CT NOFA;
NORTHEAST ORGANIC FARMING ASSOCIATION OF
VERMONT; RURAL VERMONT; OHIO ECOLOGICAL
FOOD
&
FARM
ASSOCIATION;
FLORIDA
CERTIFIED ORGANIC GROWERS AND CONSUMERS
INC.; SOUTHEAST IOWA ORGANIC ASSOCIATION;
NORTHERN PLAINS SUSTAINABLE AGRICULTURE
SOCIETY;
MENDOCINO
ORGANIC
NETWORK;
NORTHEAST
ORGANIC
DAIRY
PRODUCERS
ALLIANCE; MIDWEST ORGANIC DAIRY PRODUCERS
ALLIANCE; WESTERN ORGANIC DAIRY PRODUCERS
ALLIANCE;
CANADIAN
ORGANIC
GROWERS;
MANITOBA ORGANIC ALLIANCE; PEACE RIVER
ORGANIC
PRODUCERS
ASSOCIATION;
UNION
PAYSANNE; FAMILY FARMER SEED COOPERATIVE;
SUSTAINABLE
LIVING
SYSTEMS;
GLOBAL
ORGANIC ALLIANCE; FOOD DEMOCRACY NOW!;
FAMILY FARM DEFENDERS INC.; FARM-TOCONSUMER LEGAL DEFENSE FUND; WESTON A.
PRICE
FOUNDATION;
MICHAEL
FIELDS
AGRICULTURAL INSTITUTE; FEDCO SEEDS INC.;
ADAPTIVE SEEDS, LLC; SOW TRUE SEED;
SOUTHERN EXPOSURE SEED EXCHANGE; MUMM’S
SPROUTING SEEDS; BAKER CREEK HEIRLOOM
SEED CO., LLC; COMSTOCK, FERRE & CO.,
LLC; SEEDKEEPERS, LLC; SISKIYOU SEEDS;
COUNTRYSIDE ORGANICS; WILD GARDEN SEED;
CUATRO PUERTAS; SEED WE NEED; INTERLAKE
FORAGE SEEDS LTD.; ALBA RANCH; WILD PLUM
FARM; GRATITUDE GARDENS; RICHARD EVERETT
MEMORANDUM AND ORDER
11 Civ. 2163 (NRB)
FARM, LLC; PHILADELPHIA COMMUNITY FARM,
INC.; GENESIS FARM; CHISPAS FARMS LLC;
KIRSCHENMANN FAMILY FARMS INC.; MIDHEAVEN
FARMS;
KOSKAN
FARMS;
CALIFORNIA
CLOVERLEAF FARMS; NORTH OUTBACK FARM;
TAYLOR FARMS, INC.; JARDIN DEL ALMA; RON
GARGASZ ORGANIC FARMS; ABUNDANT ACRES;
T & D WILLEY FARMS; FULL MOON FARM, INC.;
COMMON GOOD FARM, LLC; AMERICAN BUFFALO
COMPANY; RADIANCE DAIRY; QUINELLA RANCH;
NATURE’S WAY FARM LTD.; LEVKE AND PETER
EGGERS FARM; FREY VINEYARDS, LTD.; BRYCE
STEPHENS; CHUCK NOBLE; LARHEA PEPPER;
PAUL
ROMERO;
BRIAN
WICKERT;
BRUCE
DRINKMAN; MURRAY BAST; and DONALD WRIGHT
PATTERSON, JR.,
Plaintiffs,
- against MONSANTO COMPANY and MONSANTO TECHNOLOGY
LLC,
Defendants.
----------------------------------------X
NAOMI REICE BUCHWALD
UNITED STATES DISTRICT JUDGE
Plaintiffs bring this lawsuit against defendants Monsanto
Company and Monsanto Technology LLC (together “defendants” or
“Monsanto”), seeking declaratory judgments that plaintiffs are
not
infringing
patents
are
various
invalid
and
of
defendants’
unenforceable,
patents,
and
that,
that
those
regardless,
defendants would be entitled to no remedies against plaintiffs.
Presently before us is defendants’ motion to dismiss for lack of
subject matter jurisdiction.
2
For the reasons set forth herein, defendants’ motion is
granted.
BACKGROUND1
I.
Pre-Suit Facts
The relevant facts are largely uncontested. Plaintiffs are
farmers and seed businesses, both organic and non-organic, as
well as related membership organizations. Plaintiffs do not want
to use, grow crops raised from, or sell transgenic seed, which
is seed that has had genetic code of another species introduced
to
it.
Defendants
develop,
manufacture,
license,
and
sell
chemicals and agricultural biotechnology, including transgenic
seed.
Defendants produce, in particular, transgenic seed known as
“Roundup Ready,” which is resistant to the herbicide glyphosate,
the
active
resistance
ingredient
in
trait
related
and
defendants’
product
technologies
“Roundup.”
are
covered
This
by
a
variety of patents held by defendants.2
1
These facts are drawn from the First Amended Complaint (the “FAC”) and the
numerous declarations submitted in connection with the Memorandum of Law in
Support of Monsanto Company and Monsanto Technology LLC’s Motion to Dismiss
for Lack of Subject-Matter Jurisdiction (“Defs.’ Mem.”), Plaintiffs’
Memorandum of Law in Opposition to Defs.’ Mem. (“Pls.’ Mem.”), and the Reply
Memorandum in Support of Monsanto’s Motion to Dismiss for Lack of SubjectMatter Jurisdiction. In assessing subject matter jurisdiction, we are
permitted to look beyond the pleadings. See Hunter v. Colonial Park, 409 F.
App’x 411, 412 (2d Cir. 2011).
2
The patents at issue in this action are U.S. Patent Nos. 5,322,938,
3,532,605, 5,362,865, 5,378,619, 5,424,412, 5,463,175, 5,530,196, 5,554,798,
5,593,874, 5,641,876, 5,659,122, 5,717,084, 5,728,925, 5,750,871, 5,859,347,
6,025,545, 6,040,497, 6,051,753, 6,083,878, 6,753,463, and 6,825,400, and
U.S. Reissue Patent Nos. RE38825 and RE39247.
3
Growers
who
wish
to
use
defendants’
seeds
must
obtain
limited-use licenses to do so. Because subsequent generations of
plants grown from these seeds will also contain the glyphosatetolerance trait, these licenses authorize growers to use the
seed only to grow a single crop; growers are not authorized to
harvest and plant the second-generation seed produced from the
original
planting,
or
to
sell
seeds
containing
the
patented
trait outside authorized channels of distribution.
Despite
these
restrictions,
some
unlicensed
--
and
unintended -- use of transgenic seeds is inevitable. Like any
other
seeds,
crops
through
transgenic
a
seeds
variety
of
may
contaminate
means,
including
non-transgenic
seed
drift
or
scatter, crosspollination, and commingling via tainted equipment
during
harvest
or
post-harvest
activities,
processing,
transportation, and storage. Seed businesses and farmers may, at
some
expense,
contamination
test
has
establish
buffer
transgenic
seed
their
seeds
occurred,
zones
in
and
between
order
and
to
crops
to
ensure
non-transgenic
themselves
reduce
the
and
that
farmers
farmers
risk
of
no
may
using
cross-
transmission.
No plaintiffs claim that contamination has yet occurred in
any crops they have grown or seed they have sold. However, one
plaintiff farmer claims that seed he considered purchasing in
2010 was contaminated with genetically engineered seed, (Decl.
4
of Chuck Noble in Supp. of Pls.’ Mem. ¶ 5), and one plaintiff
seed distributor claims that it received shipments contaminated
with genetically modified seed in each of 2005, 2008, 2009, and
2010, (Decl. of C.R. Lawn in Supp. of Pls.’ Mem. ¶ 4). Neither
plaintiff
asserts
that
the
offending
seeds
were
covered
by
defendants’ patents.
Contamination
can
theoretically
affect
non-transgenic
farmers by lowering the price for which their crops may be sold
and potentially resulting in rejected shipments. While there is
no
evidence
in
the
record
that
any
farmer
has
ever
been
decertified as organic by the U.S. Department of Agriculture
National
Organic
contamination,
we
Program
do
possibility.
According
certification
is
process
(the
not
to
“NOP”)
because
foreclose
the
based.”
NOP,
that
of
seed
hypothetical
however,
(Decl.
of
“[o]rganic
Carolyn
Jacobs
Chachkin in Supp. of Defs.’ Mem. (“Chachkin Decl.”), Ex. L,
Policy
Memo
aspects
of
11-13
the
(Apr.
organic
15,
2011).)
production
As
or
a
result,
handling
“[i]f
process
all
were
followed correctly, then the presence of a detectable residue
from a genetically modified organism alone does not constitute a
violation of this regulation.” (Id.)3
3
We also note, parenthetically, that organic certification is only of concern
to certain plaintiffs; other plaintiffs eschew use of transgenic seed but are
not organic farmers or seed businesses.
5
Additionally,
inadvertent
growth
of
crops
with
patented
traits may potentially subject a farmer to liability for patent
infringement. While defendants investigate hundreds of possible
patent infringers each year, between 1997 and April 2010 they
filed just 144 lawsuits to enforce their patent rights against
farmers.
Defendants,
moreover,
have
never
filed
a
patent-
infringement suit against a certified organic farm or handling
operation
over
the
presence
of
patented
traits
in
its
operations, and they stated at oral argument that they have
never sued a party who did not “want to make use of the traits
that are manifested in [defendants’] transgenic products.” (Oral
Arg.
Tr.
at
10:2-9;
see
id.
also
at
34:23-35:14.)
Indeed,
defendants have expressly declared that it is not their policy
“to exercise [their] patent rights where trace amounts of our
seed or traits are present in [a] farmer’s fields as a result of
inadvertent
means.”
Commitment:
Farmers
allege
certain
without
(Chachkin
and
Patents.)
specification
non-intentional
Decl.,
that
users
of
Ex.
O,
Monsanto’s
Nevertheless,
plaintiffs
defendants
Monsanto’s
have
seed
of
accused
patent
infringement and threatened them with litigation. No plaintiffs
claim to have been so threatened.
II.
Post-Suit Facts
On March 29, 2011, plaintiffs filed a complaint seeking
declaratory judgments that twenty-three of defendants’ patents
6
are invalid, unenforceable, and not infringed by plaintiffs, and
that,
regardless,
against
defendants
plaintiffs.
That
would
same
be
day,
entitled
defendants
to
no
remedy
republished
on
their blog their commitment not to exercise their patent rights
over inadvertently acquired trace amounts of patented seed or
traits. (FAC, Ex. 2, Monsantoco, “PUBPAT Allegations Are False,
Misleading and Deceptive” (Mar. 29, 2011).)
Shortly
emphasized
thereafter,
a
point
plaintiffs
asserted
in
wrote
their
to
defendants
filing:
“none
and
of
[the
plaintiffs] intend[s] to possess, use or sell any transgenic
seed,
including
Monsanto’s
any
patents.”
transgenic
(FAC,
Ex.
seed
3,
potentially
Letter
from
covered
by
Daniel
B.
Ravicher, Public Patent Found., to Todd Zubler, Esq., WilmerHale
(Apr. 18, 2011).) Nonetheless, the letter professes a fear of
being sued by defendants for patent infringement and “request[s]
that Monsanto expressly waive any claim for patent infringement
it
may
waiver
ever
by
have
against
providing
a
[plaintiffs]
written
covenant
and
not
memorialize
to
sue.”
that
(Id.)
Plaintiffs asserted that defendants’ failure to respond to the
letter would make it “reasonable for [plaintiffs] to feel they
would be at risk of having Monsanto assert claims of patent
infringement against them should they ever become contaminated
by transgenic seed potentially covered by Monsanto’s patents.”
(Id.)
7
In response to plaintiffs’ letter, defendants reiterated
that it is not their policy to exercise their patent rights
against farmers whose fields inadvertently contain trace amounts
of patented seeds or traits. In particular, the reply letter
referenced plaintiffs’ claim that they do not have any intention
of using any transgenic seed and noted that, “[t]aking [that]
representation as true, any fear of suit or other action is
unreasonable,
and
any
unjustified.”
(FAC,
decision
Ex.
4,
not
Letter
to
grow
from
certain
Seth
P.
crops
Waxman,
WilmerHale, to Ravicher (Apr. 28, 2011).)
Plaintiffs filed the FAC on June 1, 2011, seeking the same
declaratory judgment relief as in the original complaint while
adding a number of new plaintiffs and including a description of
the
events
that
transpired
after
the
original
complaint
was
filed. Defendants made this motion the following month, moving
to dismiss the FAC for lack of subject matter jurisdiction.
DISCUSSION
I.
Legal Standards
The Declaratory Judgment Act provides, “In a case of actual
controversy within its jurisdiction, . . . any court of the
United States . . . may declare the rights and other legal
relations
of
any
interested
party
seeking
such
declaration,
whether or not further relief is or could be sought.” 28 U.S.C.
§ 2201(a). The jurisdiction of courts to issue judgments is
8
limited
under
by
the
Article
justiciability
III
of
the
of
“cases”
Constitution.
or
See
“controversies”
Prasco,
LLC
v.
Medicis Pharm. Corp., 537 F.3d 1329, 1335 (Fed. Cir. 2008). Thus
a district court has no jurisdiction over a declaratory judgment
action
if
the
suit
does
not
meet
Article
III’s
case
or
controversy requirement.
Although
whether
“there
an
is
action
no
bright-line
satisfies
the
rule
determining
or
case
for
controversy
requirement,” id. at 1336, and “the analysis must be calibrated
to
the
particular
TubeMaster,
Inc.,
facts
528
of
F.3d
each
871,
case,”
879
Cat
(Fed.
Tech
Cir.
LLC
2008),
v.
the
Supreme Court has articulated a basic test that every dispute
must satisfy. A declaratory judgment plaintiff must demonstrate
that “the facts alleged, under all the circumstances, show that
there
is
a
substantial
controversy,
between
parties
having
adverse legal interests, of sufficient immediacy and reality to
warrant
the
issuance
of
a
declaratory
judgment.”
Ass’n
for
Molecular Pathology v. U.S. Patent & Trademark Office (“AMP”),
653 F.3d 1329, 1342-43 (Fed. Cir. 2011) (quoting MedImmune, Inc.
v.
Genentech,
Inc.,
549
U.S.
118,
127
(2007)).
The
Federal
Circuit has further refined this test4 to require “an injury in
4
“Whether
entertain
invalidity
Inc., 409
MedImmune,
an actual case or controversy exists so that a district court may
an action for a declaratory judgment of non-infringement and/or
is governed by Federal Circuit law.” MedImmune, Inc. v. Centocor,
F.3d 1376, 1378 (Fed. Cir. 2005), overruled on other grounds by
549 U.S. at 130-31.
9
fact traceable to the patentee,” which only exists if plaintiffs
have
alleged
related
to
(2) meaningful
activity.”5
“both
the
(1)
an
enforcement
preparation
Id.
STMicroelectronics,
affirmative
at
Inc.,
of
to
480
his
conduct
1343
act
the
patent
SanDisk
1372,
1380-81
patentee
rights,
potentially
(citing
F.3d
by
and
infringing
Corp.
v.
(Fed.
Cir.
2007); Cat Tech, 528 F.3d at 880).
The first element is intended to ensure that the parties
have adverse legal interests, which may be established “where a
patentee
asserts
rights
under
a
patent
based
on
certain
identified ongoing or planned activity of another party, and
where that party contends that it has the right to engage in the
accused activity without license.” SanDisk, 480 F.3d at 1381.
Such circumstances, however, are not “the outer boundaries of
declaratory judgment jurisdiction,” id., and it is possible that
the first prong of the test may be satisfied upon some lesser
showing. Nevertheless, there must be “an underlying legal cause
5
Despite placing heavy emphasis on the Federal Circuit’s holding that there
can be “no bright-line rule . . . for determining whether a declaratory
judgment action satisfies Article III’s case-or-controversy requirement,”
AMP, 653 F.3d at 1342; (Pls.’ Mem. 9-11), plaintiffs attempt to circumvent
this test first by arguing that MedImmune confers per se standing on any
plaintiff who has purchased a license to a patent. (Pls.’ Mem. 18.) The
argument evinces a lack of understanding of MedImmune’s holding, which was
that purchasing a patent license does not preclude jurisdiction where the
purchase has been coerced. See 549 U.S. at 129-31. Plaintiffs, relying on
their misreading of MedImmune, next endeavor to extend the argument and
contend that standing should be conferred on all parties who are able to
purchase a license, whether or not they have done so. (Pls.’ Mem. 19.)
Accepting this suggestion would functionally eliminate the case or
controversy requirement and should thus be rejected out of hand.
10
of action that the declaratory defendant could have brought or
threatened to bring, if not for the fact that the declaratory
plaintiff
economic
had
preempted
interest
that
it,”
the
because
otherwise
declaratory
“any
plaintiff
adverse
may
have
against the declaratory defendant is not a legally cognizable
interest
sufficient
to
confer
declaratory
judgment
jurisdiction.” Creative Compounds, LLC v. Starmark Labs., 651
F.3d
1303,
1316
(Fed.
Cir.
2011)
(internal
quotation
marks
omitted). Indeed, “[t]he mere existence of a potentially adverse
patent does not cause an injury [or] create an imminent risk of
an
injury;
absent
action
by
the
patentee,
a
potential
[infringer] is legally free to market its product in the face of
an adversely-held patent.” Prasco, 537 F.3d at 1338 (internal
quotation marks and alteration omitted).
With respect to the second element, “[i]f a declaratory
judgment plaintiff has not taken significant, concrete steps to
conduct infringing activity, the dispute is neither ‘immediate’
nor ‘real’ and the requirements for justiciability have not been
met.” Cat Tech, 528 F.3d at 880. Significantly, “the greater the
length
of
time
before
potentially
infringing
activity
is
expected to occur, the more likely the case lacks the requisite
immediacy,” id. at 881 (internal quotation marks omitted), and
if it is “uncertain when, if ever, the declaratory plaintiff
would
engage
in
potentially
infringing
11
activity,
the
dispute
[will] not present a case or controversy of sufficient immediacy
to support a declaratory judgment,” id.
II.
Declaratory Judgment Jurisdiction
A.
Defendants’ Affirmative Acts
Plaintiffs do not allege that defendants have ever demanded
royalty payments from plaintiffs, identified any of plaintiffs’
conduct as potentially infringing, or even initiated any contact
with
plaintiffs
existence
of
whatsoever.
an
actual
Instead,
case
or
plaintiffs
posit
based
controversy
the
on:
(1) defendants’ pattern of enforcing their patent rights against
non-plaintiff
farmers
through
litigation
or
threats
of
litigation; (2) plaintiffs’ assertion of the “implicit threat”
in defendants’ statement that it is not their policy to enforce
their patent rights against farmers whose crops inadvertently
acquire
trace
(3) defendants’
amounts
refusal
of
to
patented
provide
seeds
or
plaintiffs
traits;
with
a
and
blanket
covenant not to sue.
1.
Defendants’ Patent Suits Against Non-Plaintiffs
In the absence of other conduct by the patentee indicative
of adverse legal interests, the patentee must have asserted its
rights against the declaratory judgment plaintiff. See AMP, 653
F.3d
at
1348
jurisdictional
(“The
holding
district
to
court
affirmative
failed
acts
by
to
limit
the
its
patentee
directed at specific Plaintiffs . . . and thus we reverse the
12
district court’s holding that the various plaintiffs other than
[one
from
standing
whom
to
defendant
maintain
demanded
this
royalty
declaratory
payments]
judgment
have
action.”);
Innovative Therapies, Inc. v. Kinetic Concepts, Inc., 599 F.3d
1377,
1382
(Fed.
Cir.)
(“[T]he
fact
that
[the
declaratory
judgment defendant] had filed infringement suits against other
parties for other products does not, in the absence of any act
directed toward [the declaratory judgment plaintiff], meet the
minimum standard discussed in MedImmune.”), cert. denied, 131 S.
Ct. 424 (2010).
In connection with other activities supporting an inference
of
adverse
legal
interests,
suits
brought
by
the
patentee
against parties other than the declaratory judgment plaintiffs
may suffice to establish a case or controversy, but only if
those suits are sufficiently similar to the one the patentee may
potentially bring against the declaratory judgment plaintiffs.
See
AMP,
[defendant]
653
was
F.3d
at
1345
asserting
(“[A]s
its
patent
[plaintiff]
rights
was
aware,
against
other
similarly situated parties, a fact to be considered in assessing
the existence of an actual controversy under the totality of
circumstances.”
(emphasis
added));
Prasco,
537
F.3d
at
1341
(“Prior litigious conduct is one circumstance to be considered
in assessing whether the totality of circumstances creates an
actual controversy. However, one prior suit concerning different
13
products covered by unrelated patents is not the type of pattern
of prior conduct that makes reasonable an assumption that [the
defendant]
will
also
take
action
against
[the
plaintiff]
regarding its new product.”). This is because “a fear of future
harm that is only subjective is not an injury or threat of
injury caused by the defendant that can be the basis of an
Article III case or controversy.” Prasco, 537 F.3d at 1338. It
is instead “the reality of the threat of injury that is relevant
to
the
standing
apprehensions.”
inquiry,
Id.
at
not
1338-39
the
plaintiff’s
(internal
quotation
subjective
marks
and
alteration omitted); see also Hewlett-Packard Co. v. Acceleron
LLC,
587
F.3d
objective
1358,
words
1363
and
(Fed.
actions
of
Cir.
2009)
the
(“[I]t
patentee
is
that
the
are
controlling.” (internal quotation marks omitted)).
Plaintiffs argue that defendants’ 144 patent-infringement
lawsuits
filed
against
farmers
between
1997
and
April
2010
create a reality of the threat of injury. Plaintiffs, however,
overstate the magnitude of defendants’ patent enforcement. This
average
of
roughly
thirteen
lawsuits
per
year
is
hardly
significant when compared to the number of farms in the United
States, approximately two million. (Chachkin Decl., Ex. N, U.S.
E.P.A., Demographics.)
Moreover,
there
is
no
suggestion
that
these
suits
were
brought against “similarly situated parties.” AMP, 653 F.3d at
14
1345. While plaintiffs have alleged that defendants have pursued
patent litigation “against other farmers who did not want to be
contaminated
by
¶ 132),
claim
that
transgenic
is
seed,”
belied
by
(FAC
the
¶ 133;
decisions
see
in
also
the
id.
suits
against the referenced individuals. See Monsanto Co. v. Parr,
545
F.
Supp.
2d
836,
842-44
(N.D.
Ind.
2008)
(defendant
intentionally induced others to infringe Monsanto’s patents);
Monsanto Co. v. Nelson, No. 4:00-CV-1636, 2001 U.S. Dist. LEXIS
25132, at *2 (E.D. Mo. Sept. 10, 2001) (Monsanto alleged that
defendants
had
generation
intentionally
seed
saved
and
with
traits
in
patented
replanted
violation
secondof
their
licensing agreement); Monsanto Can. Inc. v. Schmeiser, 2001 FCT
256 [120] (Can.) (finding that the defendant saved and planted
seed “he knew or ought to have known was Roundup tolerant”); see
also
Farmer
Fighting
Lawsuit
Over
Seed
Planting,
Associated
Press, July 8, 2001 (describing Monsanto’s lawsuit against Troy
Roush as one involving saved seeds in violation of licensing
agreements).
Thus there is no evidence that defendants have commenced
litigation
against
plaintiffs.
The
insufficient
on
element,
objective
and,
anyone
suits
their
at
threat
against
own
best,
of
standing
to
are
in
dissimilar
satisfy
only
injury
15
similar
to
the
minimal
stead
to
defendants
are
affirmative
acts
evidence
plaintiffs.
of
any
Plaintiffs’
alternative allegations that defendants have threatened, though
not sued, inadvertent users of patented seed, are equally lame.
These unsubstantiated claims do not carry significant weight,
given
that
not
one
single
plaintiff
claims
to
have
been
so
threatened.6
2.
Defendants’ “Implicit Threat”
Plaintiffs
contend
that
the
ambiguous
language
in
defendants’ statement regarding unintentional use of patented
seeds “implicitly threaten[s] all farmers and seed businesses
who are not [defendants’] customers.” (Pls.’ Mem. 19.) In its
entirety, the purportedly threatening language reads: “It has
never been, nor will it be[,] Monsanto policy to exercise its
patent
rights
traits
are
where
present
trace
in
amounts
[a]
of
farmer’s
our
fields
patented
as
a
seeds
or
result
of
inadvertent means.” (Chachkin Decl., Ex. O.) It is objectively
unreasonable for plaintiffs to read this language as a threat.
Plaintiffs expressly allege that they “do not want to use
or
sell
transgenic
seeds.”
(FAC
¶
2.)
They
specifically
communicated the same to defendants. (Id., Ex. 3, Letter to
6
Plaintiffs have essentially already conceded that their fear of suit was not
reasonable at the time the original complaint was filed. Their letter to
defendants of April 18, 2011 -- after the original complaint was filed -notes that, “[i]f we do not receive a response from Monsanto within a
reasonable amount of time, . . . then [it would] be reasonable for our
clients to feel they would be at risk of having Monsanto assert claims of
patent infringement against them should they ever become contaminated by
transgenic seed potentially covered by Monsanto’s patents.” (FAC, Ex. 3,
Letter from Ravicher to Zubler (Apr. 18, 2011) (emphasis added).) The letter
is an implicit recognition that any anticipated risk of suit was not
objectively reasonable when the case was filed.
16
Zubler from Ravicher (“[N]one of [the plaintiffs] intend[s] to
possess,
use
or
sell
any
transgenic
seed,
including
any
transgenic seed potentially covered by Monsanto’s patents.”).)
Assuming the truth of these representations, the presence of
patented traits in plaintiffs’ seeds could only be inadvertent.
And,
while
we
grant
that
susceptible
of
differing
the
phrase
“trace
interpretations,
the
amounts”
notion
is
that
plaintiffs, who are actively attempting to avoid the use of
transgenic seed, may nevertheless find themselves unknowingly
utilizing it in significant quantities strains credulity.
Regardless, the negative inference plaintiffs wish to draw
from defendants’ statement is unwarranted. The statement is an
expression of defendants’ intention not to pursue their patent
rights against certain farmers. Yet plaintiffs want the Court to
read the statement not as a limitation on whom defendants will
sue, but rather as a positive indication of whom defendants will
bring suit against. No such inference is permissible. The plain
meaning of defendants’ statement is clear, and we cannot adopt
plaintiffs’ deliberate misreading.
Plaintiffs further contend that defendants’ reiteration of
their
statement
complaint
and
in
again
response
in
their
to
the
reply
filing
letter
of
to
the
original
plaintiffs
is
additional cause to worry. Plaintiffs, however, should hardly be
surprised and cannot reasonably feel threatened by defendants’
17
repetition
of
language
Monsanto
had
previously
utilized
to
respond to individual concerns about accidental contamination.
Indeed, plaintiffs’ letter to defendants seems to have been
nothing more than an attempt to create a controversy where none
exists. This effort to convert a statement that defendants have
no intention of bringing suit into grounds for maintaining a
case,
if
accepted,
would
disincentivize
patentees
from
ever
attempting to provide comfort to those whom they do not intend
to sue, behavior which should be countenanced and encouraged. In
contrast, plaintiffs’ argument is baseless and their tactics not
to be tolerated.7
3.
Defendants’ Refusal to Sign a Covenant Not to Sue
In their April 18, 2011 letter to defendants, plaintiffs
asked
defendants
infringement
to
[they]
“expressly
may
ever
waive
have
any
against
claim
for
patent
[plaintiffs]
and
memorialize that waiver by providing a written covenant not to
sue.” (FAC, Ex. 3.) Defendants, rather unsurprisingly, declined
7
Plaintiffs’ allegations with respect to defendants’ repetition of
their statement pertain only to conduct after the filing of the initial
complaint and, as such, do not bear on our decision, which must be an
“evaluat[ion] [of] whether a controversy existed at the time the original
complaint was filed.” Innovative Therapies, 599 F.3d at 1384; see also id.
(holding that, “unless there was jurisdiction at the filing of the original
complaint, jurisdiction [cannot] be carried back to the date of the original
pleading” by allegations in an amended complaint). To hold otherwise “would
invite a declaratory judgment plaintiff in a patent case to file suit at the
earliest moment it conceives of any potential benefit to doing so” in an
attempt to “draw an infringement suit in response (thereby retroactively
establishing jurisdiction over their first-filed declaratory judgment suit).”
Id. (internal quotation marks omitted). Plaintiffs here have acted similarly,
a further reason to discount their argument.
18
to
provide
(Pls.’
plaintiffs
Mem.
21.)
with
Rather,
the
they
requested
“blanket”
represented
that
waiver.
they
were
“unaware of any circumstances that would give rise to any claim
for patent infringement or any lawsuit against [plaintiffs]” and
that
they
had
“no
intention
of
asserting
patent-infringement
claims against [plaintiffs].” (Id., Ex. 4.)
This
exchange
occurred
discussed
above,
and,
groundless
and
defendants
declined
their
as
in
before,
tactics
to
the
same
post-filing
plaintiffs’
unacceptable.
The
plaintiffs
with
provide
letters
argument
fact
a
is
that
written
covenant not to bring any claims they might ever have does not
meaningfully add to plaintiffs’ case. As the Federal Circuit has
noted, “though a defendant’s failure to sign a covenant not to
sue is one circumstance to consider in evaluating the totality
of the circumstances, it is not sufficient to create an actual
controversy . . . .” Prasco, 537 F.3d at 1341. This notion is
particularly
defendants
apt
to
in
this
accept
as
case.
Here,
wholly
plaintiffs
accurate
the
are
asking
complaint’s
description of plaintiffs’ activities and intentions. Moreover,
the proffered waiver was so broadly framed as to preclude any
realistic
chance
of
defendants’
acceptance.
In
short,
plaintiffs’ letter was clearly intended to be used as a prop in
this litigation, and the failure to sign a covenant not to sue
borders on the wholly irrelevant.
19
B.
Plaintiffs’ Preparatory Conduct
Plaintiffs contend that they need not undertake any further
actions in order to have “meaningful[ly] prepar[ed] to conduct
potentially infringing activity,” AMP, 653 F.3d at 1343, because
defendants’
patented
seeds
will
spread
with
no
action
on
plaintiffs’ part and are self-replicating.
To the extent the test considers plaintiffs’ conduct, it is
useful because it focuses the analysis on the immediacy and
reality of the dispute. See Cat Tech, 528 F.3d at 880; cf.
Prasco, 537 F.3d at 1341. Regardless of whether plaintiffs need
to demonstrate affirmative action on their part beyond their
usual
agricultural
activities,
they
must
show
that
potential
infringement is a matter of immediate concern. Plaintiffs have
not done that.
Plaintiffs have not alleged that any of them have actually
grown or sold contaminated seed, and they have in fact professed
a desire to specifically avoid any such use. At most they allege
that they “could . . . be accused of patent infringement in the
near future if and when they become contaminated by Monsanto’s
transgenic seed.” (FAC ¶ 3.) This is the same sort of intangible
worry, unanchored in time, that the Federal Circuit has found
“insufficient
to
support
an
‘actual
or
imminent’
injury
for
standing without any specification of when the some day will
20
be.”8
AMP,
alteration
653
F.3d
omitted).
at
The
1346
(internal
cases
are
quotation
clear
that
marks
if
it
and
is
“uncertain when, if ever, the declaratory plaintiff would engage
in
potentially
infringing
activity,
the
dispute
[does]
not
present a case or controversy of sufficient immediacy to support
a declaratory judgment.” Cat Tech, 528 F.3d at 881. That is
precisely the state of affairs in the instant case, creating a
significant
barrier
to
plaintiffs
obtaining
a
declaratory
judgment.9
8
Plaintiffs contend that they are facing immediate injury because some of
them have stopped farming certain crops for fear of patent infringement suits
brought by defendants. (See, e.g., Oral Arg. Tr. at 20:10-25; Decl. of Bryce
Stephens in Supp. of Pls.’ Mem. ¶ 11; Decl. of Frederick Kirschenmann in
Supp. of Pls.’ Mem. ¶ 13.) That “injury” is of plaintiffs’ own making and, as
discussed above, is not reasonable based on “the objective words and actions
of the patentee.” Hewlett-Packard, 587 F.3d at 1363.
Moreover, as AMP makes clear, the relevant concern is of infringement,
not simply altered behavior. See 653 F.3d at 1345-46 (finding that certain
plaintiffs, who had ceased their activity out of fear of suit, had not
suffered “actual or imminent” injury because they would only “consider”
resuming the activity rather than “stat[ing] unequivocally that [they would]
immediately” resume). The plaintiffs without standing in AMP were in no
danger of invading the space occupied by the defendant’s patents because it
was not certain that they would resume the infringing activity. Here, even if
plaintiffs resumed farming their crops, contamination -- and thus potential
infringement -- is not certain. See also Cat Tech, 528 F.3d at 881.
9
At oral argument, plaintiffs asked the Court to consider a number of cases
not dealing with declaratory judgments in the patent context when evaluating
whether the controversy at bar is sufficiently immediate to support subject
matter jurisdiction. (Oral Arg. Tr. at 3:10-5:1.) Those cases, however, are
wholly inapposite because they dealt with plaintiffs seeking pre-enforcement
review of criminal statutes, not private parties engaged in civil litigation.
See Holder v. Humanitarian Law Project, 130 S. Ct. 2705, 2717 (2010);
Virginia v. Am. Booksellers Ass’n, 484 U.S. 383, 392 (1988); Doe v. Bolton,
410 U.S. 179, 188 (1973); Biotech. Indus. Org. v. Dist. of Columbia, 496 F.3d
1362, 1370-71 (Fed. Cir. 2007); see also Arris Grp., Inc. v. British
Telecomms. PLC, 639 F.3d 1368, 1374 (Fed. Cir. 2011) (noting that cases
challenging government action are treated differently than patent cases
seeking declaratory judgment).
Plaintiffs also drew our attention to Aetna Life Insurance Co. v.
Haworth, 300 U.S. 227 (1937). In that case, an insurance company was allowed
to seek a declaratory judgment before the insured had provided any indication
21
C.
“All the Circumstances”
“[U]nder
plaintiffs
all
have
the
not
circumstances”
“show[n]
that
outlined
there
is
above,
a
the
substantial
controversy, between parties having adverse legal interests, of
sufficient immediacy and reality to warrant the issuance of a
declaratory
judgment.”
AMP,
653
MedImmune,
549
plaintiffs
of
infringement
or
royalties
from
plaintiffs,
“nor
which
imply
U.S.
such
at
claims.
127).
F.3d
at
1342-43
Defendants
asserted
have
Instead,
all
have
the
they
we
(quoting
not
accused
right
taken
have
to
any
any
actions
before
us
is
[plaintiffs’] allegation that [their activities do] not infringe
the defendants’ patents.” Prasco, 537 F.3d at 1340.10
Defendants’
patent-infringement
suits
against
other,
dissimilar parties cannot by themselves create subject matter
jurisdiction,
and
the
diaphanous
allegations
that
defendants
have threatened but not sued unintentional infringers do not add
much
weight
to
the
substantiality
of
the
dispute.
Nor
have
plaintiffs pointed to any other circumstances that bolster the
that he would bring suit. The insured had stopped paying his premiums because
he claimed he was disabled and was therefore entitled to benefits; he had
made “a claim of a present, specific right” on the insurance company. Id. at
242. Defendants here have advanced no analogous claim with respect to
plaintiffs.
10
Plaintiffs’ attempt to distinguish Prasco on the basis of a footnote that
declines “to consider whether similar facts would be sufficient to establish
jurisdiction if, instead, [plaintiff] had conceded infringement and was only
arguing invalidity,” 537 F.3d at 1342 n.12, is unavailing. While plaintiffs
here do argue that defendants’ patents are invalid, they do not concede that
they have infringed those patents, which is what the Prasco court was
suggesting may have created an imminent, real dispute.
22
objective reasonableness of their claims of threat of injury.
Defendants’
statement
regarding
the
exercise
of
their
patent
rights against inadvertent infringers is, if anything, a source
of comfort rather than worry. Their actions subsequent to the
filing
of
the
threatening
plaintiffs’
none
complaint
and,
regardless,
transparent
exists.
Even
cannot
are
effort
were
reasonably
to
there
simply
create
credible
a
be
construed
as
the
product
of
controversy
threats
of
suit
where
from
defendants, there is no evidence that plaintiffs are infringing
defendants’
patents,
nor
have
plaintiffs
suggested
when,
if
ever, such infringement will occur.
Taken together, it is clear that these circumstances do not
amount to a substantial controversy and that there has been no
injury traceable to defendants. We therefore do not have subject
matter jurisdiction over this action, and it is, accordingly,
dismissed.
23
CONCLUSION
For
the
foregoing
reasons,
the
motion
(docket
no.
19)
is
granted.
Dated:
New York, New York
February 24, 2012
L(~4
NAOMI REICE BUCHWALD
UNITED STATES DISTRICT JUDGE
Copies of the foregoing Order have been mailed on this date to
the following:
Attorneys for Plaintiffs
Daniel B. Ravicher, Esq.
Sabrina Y. Hassan, Esq.
Public Patent Foundation
Benjamin N. Cardozo School of Law
55 Fifth Ave, Suite 928,
New York, NY 10003
Attorneys for Defendants
Seth P. Waxman, Esq.
Gregory H. Lantier, Esq.
Rachel L. Weiner, Esq.
Wilmer Cutler Pickering Hale and Dorr LLP
1875 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
24
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