Client Alert

Company executives are finding themselves under fire from an explosion of lawsuits challenging the validity of patent labeling and marking on consumer goods, with more than twenty suits filed U.S. courts in the last week alone.

The legal basis for these lawsuits is an obscure, 100-year-old statute (35 U.S.C. § 292) that effectively deputizes any member of the general public to enforce and seek damages on behalf of the U.S. Government for products incorrectly marked with patent information. The law clarifies that the mismarking must exist “for the purpose of deceiving the public.” The statute sets the fine at $500 per mismarking “offense”. A December 2009 U.S. Court of Appeals ruling, Forest Group, Inc. v. Bon Tool Co., clarified that each mismarked article constitutes a separate offense. The ruling spurred a cottage industry of opportunistic false marking plaintiffs.

District courts throughout the U.S. witnessed a sharp increase in false patent marking litigation in early 2010, with dozens of new lawsuits filed in late February alone. Targeted products range from computer software to soft drink packaging, and the basis is typically the inclusion of an expired patent on products or packaging. Fortunately for company executives, some district courts are pushing back. For example, the District of Delaware, in Brinkmeier v. Graco Children's Products Inc., recently dismissed patent false marking claims as to 24 of 25 allegedly mismarked patents. The court only allowed the plaintiff’s false marking claim to proceed on an expired patent that Graco asserted in two prior patent litigations, which suggested Graco specific awareness as to that patent’s term.

In general, the law on patent false marking continues to evolve and pending court decisions could either increase the number of suits significantly, or end this scheme entirely.

Womble Carlyle’s False Patent Marking Defense Team is currently defending clients in a significant and rapidly growing number of these lawsuits, and is on the front line in developing defense strategies to false patent marking claims. Our patent and litigation attorneys assess the threat at the earliest point possible, and then decide on the appropriate response to defend the company’s interests.

We also review patent markings to help companies avoid compliance-related lawsuits. Please contact our False Patent Marking Defense Team to learn more about our capabilities.

CONTACT:
Jim Lennon
(302) 252-4326
Email

Jim Vaughan
(404) 962-7528
Email

Bill Ragland
(404) 888-7466
Email