However, patent owners must be careful to ensure that the product marked as patented is indeed patented or patent applied for. Under current U.S. Patent law, anyone can file a lawsuit against a manufacturer that has falsely marked their product as patented with an intent to deceive the public. For example, if a patent application has become abandoned but the product still includes the “Patent Pending” mark, then others may have a claim against the product manufacturer for false marking. Under 35 USC Section 292, the public can sue the product manufacturer on behalf of the government for the sum of not more than $500 per each offense. This is referred to as a qui tam action. The government is seeking the help of the public to control false marking. The $500 maximum penalty may not appear to be much. However, it depends on how “each offense” is calculated.

The following case explains the meaning of “each offense.” Prior court decisions have reduced the severity of this penalty by counting each offense based on time (e.g., one week, one month, etc.). However, in The Forest Group Inc. v. Bon Tool Co. (Fed. Cir. Dec. 28, 2009), the Court held that the phrase “each offense” means each article or product. For example, if you sold 1,000 widget and falsely marked each widget, then the maximum potential liability is $500,000. This may seem unfair in light of the wide range of products that could be mismarked. For example, imposing a fine of $500 for each baseball cap may be unfair. The Court addressed this concern by pointing out that the $500 penalty is a maximum fine and not a minimum fine. Judges can adjust the fine amount to match the type of product so as to be fair.

Based on the foregoing discussion, it is important to consult with legal counsel to determine whether your product is patent pending or covered by your patent. Alternatively, you may want to consider removing any indicia indicating patent status on your product. Otherwise, you may find yourself defending a claim of false marking. Also, during enforcement of your patent, you may find yourself having to defend yourself against a counterclaim of false marking.

You may also be interested in Patent Marking.

For more information, please feel free to contact me.

The patents at issue were directed to (1) methods for controlling and monitoring access to network servers through the use of a seession identifier, and (2) a network-based sales system including a shopping cart. The patents all contained an apparatus claim and a method claim.

On Amazon’s motion for partial summary judgment that it did not have notice of alleged infringement until suit was filed, the Court granted the motion in part and denied the motion in part. On the issue of whether Soverain Software LLC (patentee) personally complied with the marking statute, the Court held that Soverain presented evidence that raises a fact issue. In particular, Soverain brought forth evidence that they included the patent number in their software code and accompanying document. Hence, the Court denied Amazon’s motion that Soverain failed to comply with the marking statute.

As to whether Soverain’s licensees complied with the marking statute, Soverain contended that they could not comply with the marking statute because the patents were directed to a method. Under Am. Med. Sys., Inc. v. Med. Eng’g Corp., 6F.3d 1523, 1538 (Fed. Cir. 1993), the Court held that a tangible item that can be marked is required to be marked to comply with the marking statute. Soverain contended that the websites employing the patented method is not a tangible item, and thus, need not comply with the marking statute for Soverain to be awarded damges prior to actual notice. The Court disagreed and held that an item’s status of tangible or intangible is not divorced from its ability to be marked, but rather the Court defined “tangible items” as those items that can be marked and “intangible items” as those that cannot be marked.

Amazon brought forth examples of various websites that have included patent numbers to show that websites can be marked. Hence, the Court granted Amazon’s motion that Soverain’s licensees failed to comply with the marking statute. Soverain Software LLC v. Amazon.com Inc., 79 USPQ2d 1208 (E.D. Tex. 2005).