Trait fees on BT cotton seeds are decided by a price control committee under the agriculture ministry.
The Supreme Court on Monday refused to stay the Delhi High Court ruling that struck down US biotechnology major Monsanto Technologies’ patent for BT Cotton seed varieties ‘Bollguard’ and ‘Bollguard II’ in India.
A bench led by Justice Rohinton Fali Nariman sought response from Indian company Nuziveedu Seeds and its subsidiaries Prabhati Agri Biotech and Pravardhan Seeds and posted the matter for further hearing on July 18.
Senior counsel Mukul Rohatgi, appearing for Monsanto, while seeking stay of the HC order, said that the impugned order has international ramifications for the company. He said that the company will continue to supply seeds to the the Indian company, which has enjoyed “my patent for 18 years. Stay would in no way affect it.”
As a result of the HC order of May 2, the patent held by Monsanto, through its Indian arm Mahyco-Monsanto Biotech (MMBL) over its Bollgard-II BT cotton seed technology, a genetically modified variant which resists the bollworm pest, was decreed to be unenforceable in India.
However, the HC had permitted MMBL to approach the Protection of Plant Varieties and Farmers’ Rights Authority (PPVFRA) under the agriculture ministry for registering the variety within three months, following which the authority would have to decide on a benefit-sharing mechanism.
Currently, trait fees on BT cotton seeds are decided by a price control committee under the agriculture ministry.
Stating that the HC revoked its patent in its entirety without trial and scientific evidence, Monsanto told the apex court that the impugned judgment was contrary to its claim of patent for a chemical product and not for a plant, seed or breeding methods. It said that the HC considered its patent to be a part of a seed, while its claimed invention is an artificial chemical product that does not ordinarily form part of any plant or seed.
According to MMBL, it is entitled to license such proprietary claimed artificial gene/nucleic acid construct, which constitutes one of the technologies that make up the Bollgard technology, in terms of a license agreement and it can terminate such agreements if the licensee breaches the terms by failing to pay the agreed consideration.
“The impugned judgment is erroneous for interpreting claims 25-27 of the patent no. 214436 to be covering the process relating to the synthesis, insertion of a gene and production of “donor transgenic seeds and plant, whereas the said claims by their ordinary terms, only cover an artificial gene/nucleic acid construct, which is a chemical product,” it said.
It further said that the HC had erroneously directed the company to seek protection under the PPVFR Act 2001, but its invention is not a plant variety under Section 2(za) of the Act, and therefore, incapable of protection under this law. Besides, the HC’s interpretation of Section 3(j) of the Patents Act, 1970, may prove to be an impediment for entry of new technology, the petition stated.
Monsanto claimed that its proprietary Bollgard technology had played a substantial role in converting India into one of the largest producers of cotton in the world from being a net importer in 2002. The reduction in the damage by using its technology has led to an increase in the average cotton yield in India from 302 kg/ha in 2002 to 541 kg/ha in 2013-14.
Both Monsanto and Hyderabad-based Nuziveedu Seeds Ltd had filed cross-appeals against the Delhi HC’s single judge’s last year’s March 28 order that ruled that Monsanto’s termination of its sub-licence agreement for genetically modified hybrid cotton seeds with Nuziveedu Seeds was illegal and arbitrary.
However, the single judge while rejecting Nuziveedu’s plea that Monsanto the US-based agro major Monsanto was incorrectly granted patent for BT cotton seeds varieties had held that all future royalty payments or trait fee for the use of Monsanto’s patented Bt cotton technology would be as per government stipulations. The Indian companies had challenged the rejection of this claim by the single judge before the Division Bench of the HC.
The court’s order came in a case filed in 2015 by Monsanto, through MMBL, against Nuziveedu Seeds and its subsidiaries for selling Bt cotton seeds using its patented technology despite termination of a licence agreement in November 2015.