Talk:Asgrow Seed Co. v. Winterboer, 513 U.S. 179 (1994)

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Maura

The Plant Variety Protection Act of 1970, 7 U.S.C. § 2321 et seq., protects owners of novel seed varieties against unauthorized sales of their seed for replanting purposes. An exemption, however, allows farmers to make some sales of protected variety seed to other farmers. This case raises the question of whether there is a limit to the quantity of protected seed that a farmer can sell under this exemption.

The developer of a novel variety obtains PVPA coverage by acquiring a certificate of protection from the Plant Variety Protection Office. See 7 U.S.C. §§ 2421, 2422, 2481-2483. This confers on the owner the exclusive right for 18 years to "exclude others from selling the variety, or offering it for sale, or reproducing it, or importing it, or exporting it, or using it in producing (as distinguished from developing) a hybrid or different variety therefrom." § 2483.

7 U.S.C. § 2543. That section, entitled "Right to save seed; crop exemption," reads in relevant part as follows:

"Except to the extent that such action may constitute an infringement under subsections (3) and (4) of section 2541 of this title, it shall not infringe any right hereunder for a person to save seed produced by him from seed obtained, or descended from seed obtained, by authority of the owner of the variety for seeding purposes and use such saved seed in the production of a crop for use on his farm, or for sale as provided in this section: Provided, That without regard to the provisions of section 2541(3) of this title it shall not infringe any right hereunder for a person, whose primary farming occupation is the growing of crops for sale for other than reproductive purposes, to sell such saved seed to other persons so engaged, for reproductive purposes, provided such sale is in compliance with such State laws governing the sale of seed as may be applicable. A bona fide sale for other than reproductive purposes, made in channels usual for such other purposes, of seed produced on a farm either from seed obtained by authority of the owner for seeding purposes or from seed produced by descent on such farm from seed obtained by authority of the owner for seeding purposes shall not constitute an infringement. . . ."2

Rather, as the Court of Appeals read the statute, § 2543 permits a farmer to sell up to half of every crop he produces from PVPA-protected seed to another farmer for use as seed, so long as he sells the other 50 percent of the crop grown from that specific variety for nonreproductive purposes, e.g., for food or feed.

Thus, a farmer does not qualify for the exemption from infringement liability if he has "(3) sexually multipl[ied] the novel variety as a step in marketing (for growing purposes) the variety; or (4) use[d] the novel variety in producing (as distinguished from developing) a hybrid or different variety therefrom." 7 U.S.C. §§ 2541(3)-(4).

he central question in this case, then, is whether the Winterboers' planting and harvesting were conducted "as a step in marketing" Asgrow's protected seed varieties for growing purposes. If they were, the Winterboers were not eligible for the § 2543 exemption, and the District Court was right to grant summary judgment to Asgrow. The PVPA does not define "marketing." When terms used in a statute are undefined, we give them their ordinary meaning. FDIC v. Meyer, 510 U.S. ----, ----, 114 S.Ct. 996, 1001-1002, 127 L.Ed.2d 308 (1994). The Federal Circuit believed that the word "marketing" requires "extensive or coordinated selling activities, such as advertising, using an intervening sales representative, or similar extended merchandising or retail activities." 982 F.2d, at 492. We disagree. Marketing ordinarily refers to the act of holding forth property for sale, together with the activities preparatory thereto (in the present case, cleaning, drying, bagging and pricing the seeds). The word does not require that the promotional or merchandising activities connected with the selling be extensive. One can market apples by simply displaying them on a cart with a price tag; or market a stock by simply listing it on a stock exchange; or market a house (we would normally say "place it on the market") by simply setting a "for sale" sign on the front lawn. Indeed, some dictionaries give as one meaning of "market" simply "to sell." See, e.g., Oxford Universal Dictionary 1208 (3d ed. 1955); Webster's New International Dictionary 1504 (2d ed. 1950).

We think that when the statute refers to sexually multiplying a variety "as a step in marketing," it means growing seed of the variety for the purpose of putting the crop up for sale.3 Under the exception set out in the first clause of § 2543, then, a farmer is not eligible for the § 2543 exemption if he plants and saves seeds for the purpose of selling the seeds that they produce for replanting. Section 2543 next provides that, so long as a person is not violating either §§ 2541(3) or (4), "it shall not infringe any right hereunder for a person to save seed produced by him from seed obtained, or descended from seed obtained, by authority of the owner of the variety for seeding purposes and use such saved seed in the production of a crop for use on his farm, or for sale as provided in this section. . . ." (Emphasis added.)

To summarize: By reason of its proviso the first sentence of § 2543 allows seed that has been preserved for reproductive purposes ("saved seed") to be sold for such purposes. The structure of the sentence is such, however, that this authorization does not extend to saved seed that was grown for the very purpose of sale ("marketing") for replanting—because in that case, § 2541(3) would be violated, and the above-discussed exception to the exemption would apply. As a practical matter, since § 2541(1) prohibits all unauthorized transfer of title to or possession of the protected variety, this means that the only seed that can be sold under the proviso is seed that has been saved by the farmer to replant his own acreage.5

Justice STEVENS, dissenting.

Moreover, as used in this statute, "marketing" must be narrower, not broader, than selling. The majority is correct that one dictionary meaning of "marketing" is the act of selling and all acts preparatory thereto. See ante, at __," prohibiting sexual multiplication "as a step in marketing" can be no broader than prohibiting sexual multiplication "as a step in selling," because all steps in marketing are, ultimately, steps in selling. If "marketing" can be no broader than "selling," and if Congress did not intend the two terms to be coextensive, then "marketing" must encompass something less than all "selling."

I think Congress wanted to allow any ordinary brown-bag sale from one farmer to another; but, as the Court of Appeals concluded, it did not want to permit farmers to compete with seed manufacturers on their own ground, through "extensive or coordinated selling activities, such as advertising, using an intervening sales representative, or similar extended merchandising or retail activities." 982 F.2d 486, 492 (CA Fed.1992).

The seed at issue is part of a crop planted and harvested by a farmer on his own property. Generally the owner of personal property even a patented or copyrighted article—is free to dispose of that property as he sees fit. See, e.g., United States v. Univis Lens Co., 316 U.S. 241, 250-252, 62 S.Ct. 1088, 1093-1094, 86 L.Ed. 1408 (1942); Bobbs-Merrill Co. v. Straus, 210 U.S. 339, 350-351, 28 S.Ct. 722, 726, 52 L.Ed. 1086 (1908).