The Federal Circuit’s recent holding in Forest v. Bon Tool, that damages for falsely marking a product as patented should be calculated on a per article rather than a per activity basis, has prompted an onslaught of false marking lawsuits. 35 U.S.C. Section 292 defines false marking and provides that where a party marks an unpatented article with a patent number, with the intent to deceive the public, any person may sue that party to recover a statutory penalty of $500 for each such offense. Recent developments, both legislative and judicial, forecast an end to this disconcerting spate of lawsuits.
In response to the new threat of false marking litigation, both houses of Congress have proposed amending Section 292(b), which provides that anyone may bring suit for false marking. The proposed revision found in S. 515 (a substitute for the Senate patent reform bill) and H.R. 4954 limits who may bring suit for false marking to parties suffering a competitive injury. Both bills further stipulate that the amendment would apply to all cases pending at the time of enactment of the bill.
In addition to proposed legislation restricting who may bring suit for false marking, the Federal Circuit indicated during oral arguments in Pequignot v. Solo Cup Co. that proving false marking may require heightened evidentiary standards. Judge Gajarsa joined Judge Rader in suggesting that a heightened standard of proof, maybe even beyond a reasonable doubt, may apply in these lawsuits, given the legislative history suggesting that false marking is a criminal act. Judge Rader added that knowledge of false marking is not evidence of deceptive intent, so a plaintiff should have to show a specific intent to deceive the public and not just intent to falsely mark.
Limiting who may bring suit for false marking and raising the evidentiary requirements for establishing deceptive intent promises to significantly lessen the number of these lawsuits. Still, for purposes of maximizing damages recovery for infringement and to effect proper notice of patent rights, it is important to make sure that patent marking considerations are analyzed with counsel.