Our firm has filed suit against five major corporations alleging false patent marking in violation of federal law. The suits, filed against Bausch & Lomb, Bayer, GlaxoSmithKline, Novartis, and Procter & Gamble, allege that the companies marked various products with one or more expired patents, in violation of a provision of the patent code. The false marking statute, 35 USC § 292, prohibits falsely marking a U.S. patent for the purpose of deceiving the public. The statute reads:
Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article, the word “patent” or any word or number importing that the same is patented for the purpose of deceiving the public … [s]hall be fined not more than $500 for every such offense.
The statute provides a private right of action similar to a qui tam claim under the False Claims Act. It allows “any person” to sue for the penalty, “in which event one-half shall go to the person suing and the other to the use of the United States.” A burgeoning wave of litigation in this area was initiated by the Federal Circuit’s recent ruling in Forest Group, Inc. v. Bon Tool Co., 590 F.3d 1295 (Fed.Cir.2009). The court rejected the Defendant’s interpretation that limited the imposition of fines under § 292 to each “decision” to falsely mark. Instead, the Federal Circuit held that the statute imposes a penalty of up to $500 per “article” that is falsely marked with intent to deceive the public. In other words, for every purposefully and falsely marked bottle of aspirin, bow tie clip, or razor blade (all examples from recently filed cases), the patentee, licensee, manufacturer, and/or distributor may face a penalty ranging from a fraction of a penny up to $500 per bottle, clip, or blade.
The Forest court further rejected the Defendant’s argument that the court’s more expansive reading of the false marking statute would spawn “‘a new cottage industry’ of false marking litigation by Plaintiffs who have not suffered any direct harm.” Noting that false marking deters scientific research and innovation, increases industry costs, and stifles competition in the marketplace, the court stated:
Rather than discourage [false marking suits by private Plaintiffs], the false marking statue explicitly permits qui tam actions. By permitting members of the public to sue on behalf of the government, Congress allowed individuals to help control false marking.
If you need more information on the above subject, please contact Archie Grubb at (800) 898-2034 or Archie.Grubb@BeasleyAllen.com for further information on false patent marking cases.
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