The proliferation of false patent marking claims asserted under 35 U.S.C. Section 292 continues. Common examples of accused conduct include the placing of incorrect patent numbers or expired patent numbers on everyday products, such as plastic cup lids, disposable razors, etc. In such actions, the plaintiff essentially sues the defendant on behalf of the federal government, petitioning for a fine of up to $500 per falsely-marked article. As a ‘reward,’ the plaintiff is generally entitled to receive half of the penalty. This type of legal action, generally referred to as a qui tam claim, is a relatively uncommon relic of past jurisprudence. However, the number of actions for false patent marking cases has continued to rise since the well-known 2009 Solo Cup case (which involved expired patents marked on plastic cup lids). Indeed, some patent blogs are now tracking this trend in qui tam false patent marking cases.
Naturally, the trend in false patent marking cases has led to a variety of federal court decisions which sometimes differ as to the legal standards applied. For instance, one primary issue involves just who may have standing to bring such a suit. In this regard, some parties have advocated that any member of the general public should have standing, while others have argued for a requirement that plaintiff must have suffered a “competitive injury.”
Another pertinent issue involves the requirements for pleading the requisite ‘intent to deceive the public.’ For instance, some proponents insist that there should be a “9(b)” pleading standard [Fed. R. Civ. P. 9(b)] wherein a party must state with particularity the circumstances constituting ‘fraud,’ i.e., provide specific factual support for a reasonable inference that the defendant falsely marked with intent to deceive the public. Others do not see a need for such a heightened pleading standard. There have also arisen different opinions on the application of such standards, such as when considering the subjective intent of the defendant v. a reliance on opinion of legal counsel. Perhaps such issues will be addressed by the Federal Circuit in In re BP Lubricants USA Inc.
We can also expect new precedents to develop over the various factors to be considered in calculating the fines for such cases. In the meantime, the recent trend in false patent marking claims has prompted new legislation designed to limit potential fines. A bill authored by Congressman Bob Latta of Ohio is calling for a single fine of $500 per decision to falsely mark, as opposed to a penalty of up to $500 for each falsely marked article.