Monsanto Co. v. Scruggs

890 F. Supp. 2d 729, 2012 U.S. Dist. LEXIS 130897, 2012 WL 3938852
CourtDistrict Court, N.D. Mississippi
DecidedSeptember 7, 2012
DocketNo. 3:00CV-161-MPM-DAS
StatusPublished
Cited by2 cases

This text of 890 F. Supp. 2d 729 (Monsanto Co. v. Scruggs) is published on Counsel Stack Legal Research, covering District Court, N.D. Mississippi primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Monsanto Co. v. Scruggs, 890 F. Supp. 2d 729, 2012 U.S. Dist. LEXIS 130897, 2012 WL 3938852 (N.D. Miss. 2012).

Opinion

ORDER

MICHAEL P. MILLS, Chief Judge.

This cause comes before the court on the motion of the parties for various post-trial relief in the above-entitled action. On September 21, 2010, a jury awarded plaintiff Monsanto Company a total of $8.9 million in damages against defendants for the infringement of patents covering the Roundup Ready® and Bollgard® seeds which it developed. The primary issues which the court must now resolve are whether defendants are entitled to a new trial or, failing such, whether Monsanto is entitled to an award of treble damages and/or attorneys’ fees based on the jury’s finding that defendants willfully violated its patents. Having considered the memo[732]*732randa and submissions of the parties, and having conducted a hearing on this issue on August 22, 2012, the court is now prepared to rule.

Due to the untimely death of Judge Pepper, this court finds itself in the unusual and undesirable position of entertaining post-trial motions regarding a trial which it did not witness. Moreover, this trial occurred in a patent case over a decade old which Judge Pepper characterized as one of the most complex which he had ever encountered. Given that this court did not witness the trial, it is, for all practical purposes, being called upon to conduct an appellate review of this case, based upon a written record of the trial proceedings. Appellate issues in patent cases have been deemed sufficiently complex and specialized that all such cases are appealed to a single appellate court: the U.S. Circuit Court for the Federal Circuit. This court obviously lacks the authority to resolve the appellate issues in this case, nor does it have anything approaching the unique expertise in patent matters developed by the Federal Circuit.

The court notes the foregoing in order to explain why, in light of these unique and regrettable circumstances, it intends to be highly deferential to the legal rulings made by Judge Pepper and the factual findings made by the jury in this case. It would, simply stated, be impossible for this court to develop anything approaching the expertise gained by Judge Pepper following years of supervising this case, and, not having actually witnessed the testimony at trial, this court is in a poor position to question the factual findings made by the jury. Having reviewed the parties’ post-trial submissions, the court sees no arguments raised by either party which would lead it to second-guess any of the legal rulings made by Judge Pepper or the factual findings made by the jury. The court will therefore deny the post-trial motions for new trial and/or remittitur, and it will concentrate on resolving the issues — foremost among them the treble damages issue — regarding which the parties have not already received a ruling from Judge Pepper or the jury. In so doing, however, the court will make some brief observations regarding the post-trial issues raised by defendants.

The court finds the $8.9 million in damages to be within the upper range of compensatory damages which the jury might reasonably have awarded in this case. The figure is close to the amount requested by Monsanto at trial, and it was vastly in excess of the amount of damages which defendants suggested was appropriate. Still, Scruggs is in a poor position to challenge the amount of compensatory damages awarded at trial, particularly in light of the fact that, it now seems clear, he actually sold the infringing seeds which he grew on his land. Scruggs did not sell these seeds under particularly egregious circumstances, considering that he had always sold seeds grown on his land in the course of his business as a farmer/retailer. Moreover, he sold the infringing soybean seeds at the price of $9.50/bag, which is far cheaper than the $25/bag retail price suggested by Monsanto. The evidence thus offers some support for Scruggs’ assertion that he was simply doing what he had always done, and the price which he charged suggests that he was not attempting to extract the maximum profits for himself on the back of Monsanto’s research. Moreover, as discussed below, Scruggs sold the seeds during a time period when the law regarding the patentability of trait-bearing seeds had yet to be definitively established.

While Mitchell Scruggs did not sell Monsanto’s seeds under the most reprehensible circumstances, he did, it now seems clear, [733]*733sell them. In so doing, he opened himself up to the potential for exponentially greater compensatory damages than if he had simply re-planted the patented seeds grown on his land but not sold them to third parties. The reason for this should be obvious: unlike most patented products, trait-bearing seeds are capable of reproducing themselves, and the testimony at trial established that Monsanto’s patented seeds looked the same as regular seeds and can only be identified by genetic testing. Under these circumstances, Scruggs inflicted an economic harm upon Monsanto which is difficult to quantify, given that it is impossible to know with any degree of certainty to what extent the seeds which he sold, or their progeny, might have been re-planted or re-sold by the farmers who bought them. The jury was asked at trial to make a finding in this regard based largely upon highly technical economic and market-based expert testimony, and the amount which it awarded suggests that they accepted Monsanto’s expert testimony at trial as being largely accurate.

Given the nature of Scruggs’ actions and the limited proof which he offered in this regard at trial, the court finds his challenges to the jury’s award of compensatory damages to not be well taken. The court does not doubt that the effect of the jury’s verdict must seem highly punitive to Scruggs personally, since he did not profit from his infringement to anything approaching the amount of damages awarded by the jury. This is not the relevant test for compensatory damages, however, and, having reviewed the parties’ post-trial arguments, the court is unable to conclude that the verdict is outside the scope of what the jury could reasonably have awarded. This is particularly true considering that, once again, this court did not witness the testimony at trial and is thus in a poor position to question the jury’s evaluation of that testimony.

The fact that this court is operating under serious limitations in considering these post trial issues was made evident from the arguments at the August 22 hearing. In seeking a new trial at that hearing, defendants placed considerable emphasis upon the fact that two of Monsanto’s expert witnesses — Dr. Timothy Conner and Duane Goldmon — had been incorrectly listed as fact witnesses in draft copies of the pre-trial order that had been circulating among the parties. At the hearing, counsel for Scruggs argued that he had been unfairly surprised by the expert testimony of these witnesses, even though he conceded that the witnesses had been properly disclosed as expert witnesses at an earlier stage of the litigation.

This matter was argued extensively on the record before Judge Pepper at trial, and, having actually supervised the litigation for years, Judge Pepper expressed considerable skepticism that the testimony of the experts in question actually came as a surprise to Scruggs. Indeed, counsel for Scruggs conceded in arguments before Judge Pepper that he was well aware from past experience that Monsanto routinely presented expert testimony of the sort offered by these witnesses:

Judge Pepper: All right.

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890 F. Supp. 2d 729, 2012 U.S. Dist. LEXIS 130897, 2012 WL 3938852, Counsel Stack Legal Research, https://law.counselstack.com/opinion/monsanto-co-v-scruggs-msnd-2012.