Ruckelshaus v. Monsanto Company

Supreme Court of the United States · 1983 · Property
467 U.S. 986 (1984)
Updated
Propertytrade secretstakingsFifth Amendmentreasonable investment-backed expectationsFIFRAEPAdata disclosure

Facts

Monsanto develops pesticides and submitted health, safety, and environmental data to EPA as part of pesticide-registration applications under FIFRA, at substantial cost and under strict secrecy measures. FIFRA as amended in 1978 allowed EPA to consider certain previously submitted data in support of later applications and to disclose much health, safety, and environmental data publicly, while providing varying periods of exclusive use and compensation. Monsanto claimed that these use and disclosure provisions took its property in trade-secret data without just compensation and, as to data consideration, for private rather than public use. The parties stipulated that much of Monsanto's submitted information contained or related to trade secrets as defined by the Restatement of Torts.

Issue

Whether Monsanto's pesticide-registration data constitute property protected by the Fifth Amendment, and if so whether EPA's consideration or disclosure of those data under FIFRA effects a taking. If a taking occurs, the Court also asked whether it is for a public use and whether an adequate compensation remedy exists.

Rule

To the extent submitted data qualify as trade-secret property under state law, they are protected by the Fifth Amendment Takings Clause. Whether EPA's use or disclosure effects a taking depends on an ad hoc inquiry focused especially on interference with reasonable investment-backed expectations, which are shaped by the statutory assurances in force when the data were submitted. No taking occurs where the submitter lacked a reasonable expectation of confidentiality or exclusive use; any taking authorized by FIFRA is for a public use, and a Tucker Act remedy is available unless Congress has clearly withdrawn it.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.
Blue Mesa AgroLabs, based in Denver, develops a pesticide and submits extensive toxicity and environmental studies to a federal regulator. Under Colorado law, the studies qualify as trade secrets because Blue Mesa kept them secret, used them in business, and they gave Blue Mesa an advantage over competitors who did not know them.

If Blue Mesa later argues that the government's compelled use of those studies amounted to a taking, what is the strongest threshold argument that the studies are protected by the Fifth Amendment?

Explanation. The majority held that, to the extent submitted material is cognizable as a trade-secret property right under state law, it is property protected by the Fifth Amendment. The key threshold is not that all submitted data are property, but that trade-secret interests recognized by state law are protected.