*1 ASGROW v. SEED CO. WINTERBOER et al., dba
DEEBEES Argued 7, 1994 January No. 92-2038. November Decided *2 Scalia, J., Rehnquist, opinion Court, delivered the in which J., O’Connor, Kennedy, Souter, Thomas, Ginsburg, C. and and Breyer, JJ., joined. Stevens, J., dissenting opinion, p. post, filed a 193. Stanley
Richard L. the cause for With argued petitioner. Lynch, Stein, were John F Law- Bruce him on the briefs Mary Maxwell, rence C. Ellen Morris. and Richard H. Seamon the cause for argued the United States as amicus curiae reversal. With him on the urging Days, Attorney brief were Solicitor General Assistant Gen- Hunger, Deputy eral Solicitor General Kneedler, Barbara Wendy Biddle, C. M. Keats.
William H. Bode the cause for argued respondеnts. With him on the brief was Luis M. Acosta.*
* Briefs of urging amici curiae reversal were filed for the American Property Intellectual by Jakes; Law Association J. Michael and for the American Seed by Kushner, Trade Association Gary Jay Roberts, John G. Jr., and David G. Leitch.
Mary Helen Sears filed a brief for Ted Cook as amicus urging curiae affirmance.
Briefs of amici curiae were filed for the Rural Advancement Foundation International et al. Masselli; David Charles and for James G. McDon- by Stephen ald Gordon. opinion delivered the of the Court. Justice Scalia Variety §2321 The Plant Protection Act of 7 U. S. C. seq., рrotects against et owners of novel seed varieties unau- replanting purposes. thorized sales of their seed for An ex- emption, pro- however, allows farmers to make some sales of tected seed to other farmers. This case raises the question quantity whether there is a limit to the exemption. seed that a farmer can sell under this I Congress passed Variety
In 1970, the Plant Protection Act *3 (PVPA), seq., 84 Stat. 7 U. S. 2321 et C. in order to provide developers plant “adequate of novel varieties with encouragement appro- for research, and for when yield priate, public to the benefits of new varieties,” §2581. patent-like protection The PVPA extends to novel (that sexually reproduced plants plants grown varieties of is, seed) parallels protection from asexually which afforded (that reproduced plant reproduced by is, varieties varieties propagation grafting) Chapter or under 15 of the Patent Act. §§ See 35 U. S. C. 161-164. developer variety of a coverage novel obtains PVPA
by acquiring protection a certificate of from the Plant Vari- ety Protection Office. See 7 U. §§2421, 2422, S. C. 2481- 2483. This confers on the owner the exclusive for 18 years selling variety, “exclude offеring others from or reproducing importing sale, or exporting it, or it, it, (as using producing distinguished it in developing) from hybrid §2483. or different therefrom.” Asgrow Company,
Petitioner, Seed is the holder of PVPA protecting certificates soybean two novel varieties of seed, which it Respondents, calls A1937 and A2234. Dennis and Becky are spans Winterboer, Iowa farmers whose farm Clay County, acres of in the northwest corner of the incorporated under the name have The Winterboers State. Corporation” the name business under and do “D-Double-U growing crops, In addition to and Seed.” “DeeBee’s Feed feed, since 1987 the Winter- and livestock for sale as food portion from of their income derived a sizable boers have crops “brown-bag” to other farmers to use as of their sales purchases brown-bag sale occurs when a farmer A seed. plants company, Asgrow, such as the seed from a seed crop, it, cleans and then sells fields, in his own harvests (usually nondescript reproduced seed to other farmers bags) plant for them to seed on their own brown During planted 265 acres of 1990, Winterboers farms. crop, 10,529 A2234, A1937 and and sold the entire salable enough plant 10,000 to others for use as bushels, sеed— price average per bushel, com- sale was acres. $8.70 price per pared bushel with a then-current $16.20 $16.80 Asgrow. directly A1937 and A2234 to obtain varieties making were a business Concerned that Winterboers Asgrow protected seed, farmer, out of its sent a local purchase. to the Winterboer farm to make a Ness, Robert soy- Mr. Winterboer informed Ness that he could sell him “just Asgrow bean seed that was like” varieties A1937 and purchased bags plant biologist each; A2234. Ness *4 Asgrow they for the and tested seeds determined that were indeed and A1937 A2234.
Asgrow brought against suit the Winterboers in the Fed- eral District Court for Northern District of Iowa, seek- ing damages permanent injunction against and a sale of seed crops grown harvested from from A1937 and A2234. The complaint alleged infringement §2541(1), under 7 U. S. C. offering Asgrow’s protected soybean or to sell varie- §2541(3), sexually multiplying Asgrow’s ties; under novel step marketing growing varieties as a in those varieties for §2541(6), purposes; dispensing and under the novel varié- without to in a form that could be propagated ties others of a variety.1 notice that the seeds were providing valid cer- did held deny Asgrow The Winterboers A2234, A1937 and and that of covering tificates protection frоm those varieties for others had sold seed produced they §§2541(1) to the and defense, seed. Their at least to use as filed, §2541 provided infringement action was in full: At the time subchapter, infringe- it an “Except provided otherwise in this shall be , variety rights perform of the of a novel to without ment of the owner States, authority, any following acts in the United or in commerce commerce, regulated by Congress affecting prior or such which can be variety protection expiration plant of the but after either the issue plant variety of a novel with the notice of the certificate оr the distribution under section 2567 of this title:
“(1) sale, it, it variety, expose novel or offer it or deliver sell the it, it, it, exchange it, buy any offer to ship consign or solicit an or other it; possession of title or transfer “(2) from, States; variety into, export or import the novel the United “(3) (for variety sexually multiply the novel as a in purposes) variety; or (as “(4) distinguished variety producing develop- use the novel therefrom; ing) hybrid variety or or different “(5) Propagation use seed which had been marked “Unauthorized Pro- Multiplication progeny hibited” or “Unauthorized Seed Prohibited” or variety; propagate thereоf to the novel or “(6) another, variety dispense propa- the novel a form which can be gated, being protected variety without notice as to under which it was received; or
“(7) any perform foregoing acts even in instances which the sexually, multiplied except pursuance novel other than of a plant patent; valid United States
“(8) instigate actively performance any induce of the foregoing acts.” §2541, Congress designating In October amended prior text (a) (b), adding provisions
as subsection a subsection of which are however, Curiously, §2543 not relevant here. the refеrences in to the infringement provisions of amended to change. 2541 were not reflect this clarity’s sake, therefore, infringement For we will continue to refer to the g., e. provisions 2541(l)-(8), §§ prior designations, under their rather than §§2541(a)(l)-(8). g., e. designations, their current *5 (3) charges, upon the contention that their sales fell rested infringement statutory exemption liability within the “Right section, That entitled found in 7 S. C. 2543. U. exemption,” part crop seed; reads relevant save follows: may
“Except extent that such action constitute to the (4) (3) infringement an under subsections of section infringe any right title, it shall not hereun- 2541 of this produced by person him der for a to save seed from seed authority obtained, obtained, descended from seed seeding purposes of the owner of and use production such saved seed in the of a for use on provided his or for sale as in this Pro- farm, section: regard provisions vided, That without to the of section 2541(3) infringe any right of this title it shall not hereun- person, primary farming occupation der for a whose crops reproductive for sale for other than purposes, persons to sell such saved seed to other so engaged, reproductive purposes, providеd such sale compliance governing inis with such laws State the sale applicable. of seed as be A bona fide sale for other reproductive purposes, than made channels usual purposes, produced for such other of seed on a farm by authority either from seed obtained of the owner seeding purposes produced by or from seed descent by authority on such farm from seed obtained seeding purposes owner for shall not constitute an infringement.. . .”2 2Congress recently has by striking amended this section from the first “ Provided,
sentence the words ‘section: That’ and all that through follows ” period and inserting Variety ‘section.’ Plant Protection Act Amend 1994, 103-349, ments of Pub. L. 108 Stat. 3142. That amendment eliminating has the effect of from infringement liability for PVPA-protected farmers who sell seed to other reproductive farmers for purposes. action, however, That has bearing no on the resolution of the
185 them The Winterboers that this the argued language gave of seed from a to sell an unlimited amount produced that variety, the conditions both subject protected only and seller be farmers “whose farming occupa- buyer primary for other reproduc- tion is the for sale than crops tive and that all with state law. As- comply sales purposes,” that to save maintained the allows a farmer grow and resell to farmers the amount of seed the seller other only fields —a that would need to his own limitation replant Winterboers’ The Court greatly sales exceeded. District with and its agreed Asgrow summary granted judgment (1991). 795 915 Supp. favor. F. States United Court of for the Federal Appeals (1992). 982
Circuit reversed.
F. 2d 486
Although “recog-
that,
limitations,
without
ex-
nizing]
meaningful
crop
§
could
much of
incen-
undercut
the PVPA’s
emption [of 2543]
id.,
491,
tives,”
§2543
at
the Court of
saw
Appeals
nothing
(for
would limit
sale of
reprоductive
to the amount
necessary
the seller’s own
purposes)
plant
as
Rather,
read the
acreage.
Appeals
statute,
Court
§2543
a farmer to
to half of
permits
every
sell
he
up
seed to
farmer
produces
another
PVPA-protected
use
seed,
so
as he
the other 50
long
sells
percent
crop grown from
specific variety
nonreproductive
g.,
e.
for food or
purposes,
feed.
Federal Circuit denied
Asgrow’s petition
rehearing
suggestion
rehearing
(1993).
en banc
a vote of six
to five.
II It be towell at the outset that is acknowledge quite impossible to make sense of the at complete provision issue present case, since amendments affect those certificates issued id., April 4,1995, after that were pending on or before that date. See §§ 14(a), 15,108 Stat. 3145.
here. One need no further than the first go very words of not, its title to establish that. Section 2543 does as that title claims and the text reserve ensuing says, to save any “[r]ight seed” —since elsewhere in the Act nothing remotely prohib- its the under Nor, seed. saving any possible analysis, (“Provided, That”) the first sentence of proviso really proviso. *7 this advance
With that not all will warning mysteries be solved, we enter §2543. the verbаl maze of entrance, discover, exit, we an actually since the provision begins to by certain activities from its excepting operation: “Except the extent that such action constitute an infringement (3) ()) 25)1 under subsections and section title, this shall not infringe hereunder any right person save seed produced him . . and use . such saved seed in the of a for use on production farm, his or for sale as pro- added.) vided in this section . . . .” (Emphasis Thus, a farmer does not qualify infringement if he has liability
“(3) sexually the novel multiplied] as a variety (for growing purposes) or variety; (4) (as the novel use[d] variety distin- prоducing guished from developing) hybrid or different variety §§2541(3)-(4). therefrom.” 7 U. S. C.
In 1990, the Winterboers 265 planted acres of Asgrow pro- tected seed and collected a 12,037 harvest of bushels of soybeans. The parties do not dispute this act of and planting constituted harvesting “sexual multiplication” of the novel 2401(f) varieties. See 7 U. S. C. “sex- (defining ually reproduced” seed to include “any of a production vari- seed”). ety by The Winterboers sold almost all of these (i. beans for use as e., “for growing purposes”), without Asgrow’s consent. The central in this question ease, then, is whether the Winterboers’ and planting were harvesting conducted “as a step marketing” Asgrow’s protected seed
187 varieties for If they were, the Winter- purposes. §2543 boers were not and the Dis- eligible exemption, trict Court was grant summary judgment Asgrow.
The PVPA does not define When terms “marketing.” undefined, used a statute are we them their give ordinary Meyer, FDIC v. (1994). meaning. U. S. Federal Circuit believed that the word “marketing” requires “extensive or coordinated activities, such selling as advertis- an ing, sales ex- using intervening representative, similar tended or retail activities.” merchandising 2d, F. at 492. We disagree. refers to the Marketing ordinarily act of hold- forth ing sale, with the proрerty together activities pre- (in thereto paratory case, present cleaning, bag- drying, seeds). ging, The word pricing does not require promotional activities merchandising connected with the be extensive. can One market apples by them simply on a cart with a displaying or market price tag; a stock it on a stock by simply listing or market a exchange; (we market”) house *8 would on it the normally say “place by a “for sale” on simply setting the front sign Indeed, lawn. some dictionaries as one of give “market” meaning simply e.g., “to See, (3d sell.” Oxford Universal 1208 Dictionary 1955); (2d ed. Webster’s New Intеrnational Dictionary 1950). ed. course, Of effective often involves selling exten- sive activities, promotional and when occur they are all they of the part But even when “marketing.” the forth holding for sale relies no more than upon word-of-mouth advertising, of is in goods process. Moreover, even if the word could, in “marketing” one of its meanings, demand ex- tensive promotion, we see no reason why law at issue here would intend that That meaning. would have the ef- fect of PVPA preserving for protection less valuable plant but varieties, it for varieties so eliminating desirable that can be they marketed word of by mouth; as well as the effect of courts to requiring the difficult ponder of question how much is promotion necessary constitute We marketing. sexually multiplying a refers to that when the statute
think marketing,” seed of variety means “as a putting crop up variety purpose for sale.3 of §2543, exception then, in the first clause of set out Under plants if he eligible the 2543 is not a farmer they purpose seeds seeds for the and saves replanting. produce for long person is not provides that, so as a next
Section 2543 2541(3) (4), §§ violating either person infringe any right hereunder for а “it shall by produced obtained, him from seed to save seed authority by obtained, of the owner from seed descended seeding purposes and use such saved crop farm, or production of a for use on his in the (Emphasis provided . in this section . . .” for sale as added.) soybean crops generally grow A harvested sell. Farmers premises typically in short crop from the farmer’s is removed grain processor. elevator or Some- and taken to a order soybean, plant such as the however, in the case of times, portion of crop seed, the farmer will have a is the which replanting as seed for his fields his cleaned and stored it clear that this seed saved re- We think next season. by provision planting what the under discussion means is demanding the Federal Circuit’s more inter The dissent asserts disfavoring the ancient doctrine “marketing” supported pretation post, see at 194-195. The wellspring on alienation of property, restraints doctrine, course, and in the con property rights, is concern of that ours, than which interpretation, PVPA it is the dissent’s rather text of the *9 The whole of the statute is to create purpose belittles that concern. by giving in the of botaniсal research the devel property product valuable variety, offering others from the or it the to “exclude oper it, it,” sale, it, or etc. 7 U. S. C. importing exporting for or reproducing § restraints on alienation to disfavoring interpre 2488. the rule Applying like the rule restraints applying disfavoring tation of the PVPA is rather of the Act. interpretation freedom of contract Sherman upon “saved seed” —not uncleaned merely regular crop stored for later market sale or use as fodder.
There are two to read the ways provision, depending upon which words the “for sale as in this phrase section” provided is taken to It can be read modify. of a “production ... crop for sale as section”; this provided alternatively “use such saved seed for sale as ... in this section.” provided The parallelism created the use on his farm” phrase “for followed “or sale as immediately by this sec- provided tion” the former But the suggests reading. placement comma, “use such saved separating [of] the produc- tion of a farm,” for use on his sale,” “or for favors the latter does the So fact the reading. alternative the “Provided, reading reader requirеs skip lengthy That” clause order to find out what sales are “provided in this [for] despite parallelism between “pro- section” — “Provided,” vided” and despite of a presence colon, which indicates ordinarily specification what has preceded. It is easier surely to think that at least some of the sales for” are those that “provided are “Provided” after the colon. (It is, course, unusual, however deplorable be, for “Provided, That” to be used as to an prologue addition rather than an See Springer Is- exception. v. Philippine lands, 277 U. S. 206 (1928); 1A N. Singer, Sutherland on (5th 1992).) § Construction Statutory 20.22 ed.
We think the latter is also to be reading preferred because it lends to all greater meaning Under provisions. former reading (“production for sale as crop... provided in this section”), the later text only that could be referred to is the provision “bona fide for other than sale[s] reproduc- tive set out in the purposes” second sentence of 2543—the (The so-called “crop exemption.” not be re- could proviso to, ferred since it does not provide sale of crops grown from saved seed, but itself.) sale of saved seed But if the “or for sale” has рrovision such a limited referent, clause’s opening that...”) (“Except the extent reservation *10 (i. 2541(3) liability growing liability § infringement e., for purposes) marketing reproductive would be step in for as a provision which it is attached content, since the devoid of purposes. reproductive permit Under no sales for would [his] reading, by not “use contrast, the farmer the latter proviso the seed as the allows for sale” saved seed ... if purpose intentionally grown e., sale—i. of such was (for marketing step “sexually multiplied]... as a variety.”4 respect in which our fa- purposes) A second provision reading greater meaning gives is this: to the vored provided reading (“crop as this ... for sale The other section”) opening “permission” given in the sen- causes the nonreproductive purposes only to sales for tence to extend opposed crops grown to sales of seed, from saved separate permission would saved seed itself. But no already required contained this, for since it is have been crop exemption itself; it serves as a reminder within the exemp- saved can sold under that seed be peculiarly incomplete reminder, since the saved sеed tion—a exemption. can also be sold under that itself By proviso reason of its the first sentence of To summarize: preserved reproductive 2543 allows seed that has been for (“saved seed”) purposes purposes. such to be sold for such, however, structure of the sentence is that this authori- grown zation does not extend to saved seed that was for very purpose (“marketing”) replanting of sale —because §2541(3) in that and the case, violated, would be above- that “with reading gives meaning proviso’s This also to the statement 2541(3)... regard out to provisions infringe any of sectiоn it shall not person engage hereunder” for a in certain sales of saved seed added). reproductive purposes (emphasis This serves to eliminate the argument production originally technical that a that was in compli §2541(3) (because with step ance it was not done as a reproductive purposes) retroactively could be rendered unlawful because such sale causes the earlier permitted proviso, later sale in the production marketing” reproductive to have been “a in the purposes. apply. exception
discussed to the would As *11 §2541(1) practical prohibits matter, since all unauthorized protected variety, possession the to, of, transfer of title only the seed can be this means that sold under the proviso replant the farmer is seed that has been saved to (We apparent acreage.5 his think that limitation is also own crop exemption, permits the the which text of a farm crop nonreproductive pur- from saved seeds to be sold—for “produced by poses only if seeds those saved were descent — added.) (Emphasis on It is in our view such the farm” crop exemption, proviso 2543,and not the that authorizes buyers permitted crops they of to sell the the saved seeds produce.) replant if Thus, a to farmer saves seeds his acre- age, changes plans, may but for some reason his he instead replanting for the sell those seeds under terms set forth (or proviso nonreproductive pur- the them course sell for poses crop exemption). under the proviso
It remains to discuss final feature of one the au thorizing reproductive purposes. pro sales for limited replanting purposes only viso allows sales of seed saved persons occupation primary farming between “whose is the crops reproductive pur for sale for other than poses.” rejected the-proposition Circuit, Federal which the-, crops soybeans, For such as which seed: and: the harvest are one same, and the will enough year’s this mean crop seeds- one on that germination acreage. Since time, the rate of a batch of-seed declines over soybean the get year-after-next’s farmer will year’s seeds from next harvest. That so vegetable crops, is not for some in which the seed is not harvest, portion and a crop permitted оf the overripen (“go must be to seed”) seeds. One of the amici in the Court of to in order to obtain Ap (and peals parties asserted before us did not dispute) it is the practice vegetable “grow” only every farmers seeds four or five years, and bag” enough to “brown crops. seed for four or A five future vegetable protected farmer who sets subsequent aside replant seed with mind, ings (because but who later plan abandons his he has his sold farm, example), would our analysis under be able to sell all his saved seed, (in though even it plant year) would a single four or five times his acreagе. current is seed saved seed sellable under
that the sought replanting, achieve some limi own for the farmer’s repro quantity upon of seed that can be sold for tation by adopting “crop-by-crop” approach purposes ductive pro farming occupation” requirement “primary bag qualify “[B]uyers of brown seed or sellers viso. crop exemption,” larger “only they produce concluded, if (or consumption crop protected nonre- other from a productive purposes) 2d, at than for sale as 982 F. seed.” brown-bag say, the seller can sell no morе That is to 490. The words of the his for seed. than half of (if way some however, stand in the of this creative statute, insubstantial) To what is a farmer’s what limitation. ask *12 farming occupation” “primary is to what constitutes the ask farming Selling crops for other bulk of his total business. preponder reproductive purposes must constitute the than just preponderance business, of ance of the farmer’s way simply no his business in the seed. There is the Federal to derive from this text the narrower focus that quantity applied. if can be Thus, of seed that Circuit by as we reference to the sold not limited have described— original purpose it is for which the seed is saved—then (i. barely only by e., limited at all limited the volume or farmer’s worth of the total sales for other than reproductive purposes). unlikely This seems to us most result.
[*] [*] [*] requirements hold that a farmer We who meets the set § proviso reproductive pur- forth in the to 2543 sell for poses only purpose such seed as he has saved of re- planting acreage. meaning his own While the of the text is only reading clear, no means this is in our view the comports statutory purpose affording “adequate with the encouragement appro- research, and for when priate, yield public for the the benefits of new varieties.” §2581. 7 U. S. C. Because we find the sales here were un- lawful, we do not reach the second on which we question sales granted §2543 certiorari —whether authorized under §2541(6). remain to the subject notice requirement of the Court of judgment Appeals Federal Circuit is
Reversed. Stevens, Justice dissenting. to this key is the statutory puzzle of the meaning “as a
phrase, as used in marketing,” 7 U. S. C. 2541(a)(3) (1988 V). ed., If it is Supp. with synonymous ante, “for the purpose as the selling,” holds, Court see at then the majority’s comprehensive exposition statute is correct. I recоrd dissent my because that only phrase conveys different message to me.
There must be a reason used why Congress the word rather than “marketing” the more common term “selling.” Indeed, §in 2541(a)(1), contained in the same subsection of the statute as the crucial language, Congress made it an act of infringement “sell the novel variety.” Yet, §2541(a)(3), a mere two clauses later, Congress eschewed the word “sell” in favor of Because “marketing.” Congress ob- could have viously prohibited sexual multiplication “as a step I selling,” presume that when it elected to prohibit sexual (for “as a multiplicatiоn step marketing growing pur- *13 poses) variety,” meant Congress something different. Moreover, as used in this statute, must “marketing” be narrower, not broader, than The selling. is majority correct that one of meaning is the act of “marketing” and all selling ante, acts preparatory thereto. See at 187. But Congress has prohibited one only act —that of preparatory sexual mul- tiplication only when it is a in step marketing. Under —and the majority’s broad definition of “marketing,” prohibiting sexual multiplication “as a in step marketing” can be no broader than prohibiting sexual multiplication “as a selling,” becausе all steps are, ultimately, steps
194 “selling,” “marketing” no broader than selling. If can be be Congress intend the two terms to coexten- if not did something “marketing” encompass less than must sive, then “selling.” all interpreted by as of the Court as a whole—and statute Congress preserve to Appeals that intended —indicates “brown-bag right engage in so-called sales” of
farmer’s Congress neighboring farmers. limited seed to may by express requirement that not consti- such sales buyer farming occupation” “primary of either the tute the 2541(a)(3) abundantly makes it Moreover, seller. “marketing” participation of that the unauthorized clear “marketing” interprets If is taboo. one varieties namely, selling activities, mer- subcategory of to refer to a cooperatives, wholesalers, retailers, chandising through farm distributors, the entire statute seems commercial or other ordinary any Congress I wanted to allow think make sense. but, as brown-bag another; one farmer to the Court sale from Appeals permit it farmers to concluded, did want of ground, compete on their own with seed manufacturers through activities, such “extensive or coordinated intervening representative, advertising, using sales an merchandising 982 or retail activities.” extended similar (CA 1992). 2d Fed. 486, F. 492 reading is time- consistent with our
This of statute viewing practice restraints on the alienation of honored of e.g., See, Wheaton, v. property Sexton with disfavor. J.).* (1823) (opinion Marshall, C. Wheat. by crop planted part and harvested a issue a seed at Generally per- property. the owner of his own farmer on which power of that absolute consequence *“It seem to be would any he make disposition over his own possesses property, man others, rights and such existing not interfere with of which does real, will valid. The limitations on this disposition, if it be fair and be Wheaton, Sexton law.” v. which are power prescribed are those Wheat., at 242. *14 sonal property patented article —is copyrighted —even free to of that as he sees e. g., dispose property See, fit. Co., United States Univis Lens v. 241, 316 U. S. 250-252 Straus, Bobbs-Merrill (1942); Co. v. 339, 210 U. S. 350-351 (1908). A statutory restraint on this basic freedom should be expressed clearly and unambiguously. Cf. Deepsouth Laitram Packing Co. v. (1972). 406 U. Corp., S. 530-531 As the recognizes, of this majority meaning statute is no means Ante, “by clear.” at 192. both be- Accordingly, I cause am Court persuaded of Appeals correctly intent interpreted of Congress, and because doubts should be resolved against on restraints purported freedom, I would affirm the judgment below.