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FALSE MARKING – REAL DAMAGES

by | May 26, 2010 | Patent | 0 comments

On remand from the Federal Circuit, the U.S. District Court for the Southern District of Texas based a damages award for false patent marking on the highest selling price of the falsely marked products.

In Forest Group Inc. v. Bon Tool Co., 2010 U.S. Dist. LEXIS 41291 (S.D. Tex. Apr. 27, 2010), the Court found “the appropriate fine in this case is $180.00 per article, the highest point of the [sales] price range. This will deprive Forest of more than it received for the falsely marked stilts, fulfilling the deterrent goal of §292’s fine provision.” (emphasis added).
 

As previously reported herein, the Federal Circuit decision in Forest Group Inc. v. Bon Tool Co., 590 F.3d 1295 (Fed. Cir. 2009) radically changed the legal landscape with regard to false patent marking under 35 U.S.C. §292, which prohibits the use of patent or patent pending designations “for the purpose of deceiving the public” and provides for a maximum penalty of $500 “for every such offense.” Prior to the Federal Circuit’s decision, courts typically treated the false marking of multiple units of a product as a single “offense”, thereby limiting damages to $500 per decision, however, in Forest Group, the Federal Circuit held that a fine must be imposed separately for each falsely marked product.  The Federal Circuit did note that in some cases the appropriate measure of damages may only be a fraction of penny per article.
 
While the resultant total damages award by the District Court in Forest Group is relatively nominal ($6,840.00) due to the limited number of the falsely marked products sold, it is noteworthy that the Court elected to strip Forest Group of “more than it received”, perhaps signaling an end to the era of lax enforcement under §292.