Benefits of Patent Marking
35 U.S.C. § 287 of the Patent Act provides that a patentee selling its invention may give notice to the public that the invention is patented by marking the patented product with the word "patent" or the abbreviation "pat.", together with the number of the patent. Patent marking enables patentees to give notice to the public of their exclusive rights to manufacture and sell the patented invention. Although patent marking is optional, if a patentee does not do so the Act also provides that "no damages shall be recovered by the patentee in any action for infringement," unless there is proof the infringer had actual notice of the infringement and continued to infringe. This clearly is a strong economic incentive for a patentee to mark his or her product with the patent number.
Consequences of False Marking
The opposite side of the coin is 35 U.S.C. § 292, which prohibits false marking. False marking occurs when one, for the purpose of deceiving the public, marks a product or indicates in advertising that the product is patented or "patent pending" when such is not true. Acts of false marking deter innovation and stifle competition in the marketplace. The penalty for false marking is a fine of not more than $500 for every offense. The interest in preventing false marking was so great that the Patent Act includes a provision that enables third parties to bring suit for false marking and split the penalty with the government if successful.
In the past, district courts applying § 292 found that continuous false marking of multiple articles constituted a single offense. For example, ordering 100,000 falsely marked widgets would be one $500 penalty. Alternatively, some courts imposed time-based penalties, like fining a company $500 for each day, week or month the articles were produced. In The Forest Group, Inc. v. Bon Tool Company, et al., 590 F.3d 1295 (Fed. Cir. 2009), the Court of Appeals for the Federal Circuit held that ? 292 requires a per article fine. That means up to $500 for each widget falsely marked. The Federal Circuit recognized that its decision might encourage the so-called ?marking trolls? who deliberately search for false markings but found such behavior explicitly permitted under the statute.
Practical Tips for Patent Marking
- Make an informed decision about whether or not to provide notice of your patent rights. In the past, patent marking was presumed to be the proper course of action as false marking carried a much lighter penalty. In view of Forest Group, weigh the potential costs and benefits.
- Know what your patents cover. A costly mistake may be made if you do not understand the scope of your patents. Confirm with patent counsel to ensure that a product is in fact covered by one or more claims of a patent.
- Be diligent in knowing the status of your patent. In addition to a patent?s natural expiration, a patent may expire for failure to pay a maintenance fee. A court?s claim construction, invalidity or unenforceability ruling also may require a change in how a product is marked and may impact the intent analysis as in Forest Group.
Steptoe & Johnson PLLC
Chief Marketing Officer