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Business Impact

Full of (Soy) Beans

A worrisome Monsanto patent claims exclusive rights over all genetically engineered soybeans.

It has been a pleasure and a privilege to voice my opinions on the increasingly important and often misunderstood subject of intellectual property. But after nearly three years writing this column, I’m taking a break from punditry to devote more time to reporting and a new book project.

I’ve argued here-and in my book Owning the Future, which spawned this column-that in allowing corporations to amass ever broader, exclusive proprietary rights to entire areas of knowledge, we are making some grave mistakes that we will almost certainly come to regret.

A recent European patent ruling perfectly underscores the point. The case involves an audacious patent by the plant biotechnology giant Monsanto claiming exclusive rights over all genetically engineered soybeans-yes, you read it right-created by the company’s or any other method. In the latest surprise development, after eight years languishing on appeal, the patent was upheld as valid by the European Patent Office.

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Bottom line: this patent is full of beans.

Such a broad patent does nothing to provide incentive for new innovation. Instead, it does the precise opposite, shutting off potential competitors’ efforts in the face of the time-limited monopoly. Of course, the situation is all the more worrisome when the monopoly involves a crucial world food crop. Even the U.S. Department of Agriculture could see this problem when a small Wisconsin-based firm called Agracetus was granted a close cousin to the soybean patent in the United States a decade ago-one claiming rights to all genetically engineered cotton.

In that case, the USDA stepped in, contested the patent, and ultimately helped convince the U.S. Patent Office to overturn it. Ironically, a major force backing the patent’s overturn at that time was Monsanto. The company’s 292-page legal memorandum argued persuasively that the broad Agracetus patent should be revoked. But that was before Monsanto’s 1996 acquisition of Agracetus’s plant biotechnology assets-including its European soybean claim. From then on, Monsanto defended the soybean patent, deciding that a monopoly on genetically engineered crops wasn’t so bad after all.

It is worth noting that Monsanto and Agracetus structured their broad claims around a gizmo called a “gene gun,” though neither actually invented this device for inserting genes into plants like soybeans and cotton. The technology was developed by a team at Cornell University. Thus, the multibillion-dollar question is this: just because Agracetus was the first to use this tool to blast gold beads covered with DNA into soybeans, why should that entitle them to demand royalties from another firm inserting different genes into different soybean varieties by different means? Put another way, why should one firm that accomplished one significant but small step be able, for two decades, to control innovation over an entire crop species? But that, alas, is precisely what the firm is trying to do (and what it has done in Europe): its patent governs all genetically modified soybeans engineered by its or any other method. And we’re talking about a lot more than tofu and soy sauce here. Soybeans are the second-largest U.S. crop after corn, the world’s foremost source of protein and oil, and a major component of livestock and poultry feed, a key ingredient in the food chain.

Monsanto already controls virtually the entire market for genetically engineered soybean seeds. And crops sown from Monsanto’s genetically engineered seeds now cover more than half of the 72 million hectares on the globe that are planted with soybeans. Patents aren’t the only reason for this monopoly, but with the European patent upheld, Monsanto’s monopoly concentration will likely only increase in the future.

Patents like this one are utter folly. Patent and copyright law has a vital role to play in the emerging global information economy. But the system was designed to provide incentive for new inventions; it was never intended to hand out monopolies on whole areas of research. Overly broad patents will lead to monopolies where we neither need nor want them. Similar problems are cropping up across the high-tech landscape: patents are literally killing AIDS victims in Africa by denying them access to affordable medicines even though we know how to make the drugs cheaply; absurdly broad e-commerce patents are tangling the World Wide Web; and overly expansive copyright laws threaten our ability to share information.

The kinds of excesses we’ve been seeing lately need not be foregone conclusions. The trick is for those at the high-tech frontier to help our legislators be farsighted in thinking about the public’s stake in intellectual property, building a system that equitably rewards new developments while at the same time providing a healthy environment for innovation. The good news is that many groups have begun to meet this challenge; among them, Creative Commons, the Public Library of Science, and Washington, DC-based Public Knowledge (I’m on their advisory board) are trying to map out a role for the public, just as the vibrant open-source-software community is doing much to stem the tide of proprietary control over software code.

Once we get beyond inane debates about whether intellectual property is “good or bad,” the task of setting reasonable limits on proprietary rights is not as hard as it may sound. But there’s a clear first step: quit handing out absurdly broad patents that allow corporate bullies to grab intellectual-property monopolies on our collective future.

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