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Forest Group v. Bon Tool on remand

April 29, 2010 Leave a comment

In Forest Group, Inc. v. Bon Tool Co. [DOC], 590 F.3d 1295 (Fed. Cir. 2009), the Federal Circuit, on appeal from the U.S. District Court for the Southern District of Texas, held that a false marking fine of not more than $500 should be assessed for each article marked falsely.

On remand, the Southern District ordered [PDF] on Tuesday that Forest Group shall be fined $180 for each falsely-marked article, for a total fine (based on evidence at trial of 38 sales of falsely-marked articles) of $6,840.00. This is not much in absolute dollars. Notably, however, this represents the upper limit of the sale price for each of the articles, meaning that Forest made no money at all on any of the sales of a falsely-marked product (and, indeed, could have lost money on some sales, since the evidence showed there were sales at prices as low as $103).

The court noted that such a fine (amounting to the total sales price of the false-marked articles) “fulfill[s] the deterrent goal of [35 U.S.C. Sec. 292’s] fine provision.”

Indeed it does.

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Current Topics in False Marking

April 2, 2010 Leave a comment

First:

Devoted readers will note that I had a number of posts on this blog in late February and early March on the topic of false marking, compiling cases and noting some of the issues arising.  See, for example, here, here, and here.

For the most part, and for the near future, I will probably stop writing such posts.  I still think the topic is extremely interesting, and have been following it closely, but there is no use in duplicating the excellent efforts Justin Gray and Docket Navigator are putting forth on the subject at Gray on Claims.

For example, today Justin and the Navigator have interesting charts showing the types of patent issues that lead to false marking cases, both before and after the Federal Circuit’s decision in Forest Group, Inc. v. Bon Tool Co. [PDF].  Justin and the Navigator also provide a comprehensive table that is continually updated with a listing of false marking cases.

I think the chart that is on Justin’s post today is interesting. It shows that the false marking cases filed before the Forest Group decision were split roughly equally between those based on products marked with unenforceable patents (e.g., expired), and those based on products not within the scope of the marked patent.  Now, however, the false marking cases are overwhelmingly based on products marked with expired patents. 

My gut feeling about this is that, post-Forest Group, a motivated group of individuals is looking for false marking cases.  As such, for this group it is far easier (and quicker) to search a patent number marked on a product and find out if it’s expired than it is to analyze a patent to determine whether its claims cover the product at issue (or to determine whether an ambiguously-marked product is covered by the claims of any patent).

Second:

McDonnell Boehnen Hulbert & Berghoff LLP is also getting into the false marking game.  Their site, False Patent Marking Resources (http://www.falsemarking.net/) looks, like Gray on Claims, to be a good source of contemporary information on false marking cases.  The MBHB site helpfully includes listings of cases by court, party name, etc., and includes links to decisions, briefs, and so on.

Third:

On April 6, the Federal Circuit will hear oral argument in the appeal of the false marking case Pequignot v. Solo Cup.  In Pequignot, the lower court dismissed the false marking case against Solo Cup, finding no intent to deceive by Solo, and holding that a false marking “offense” is a “decision by a defendant to falsely mark.” That latter holding is in conflict with Forest Group.

PubPat hits Adobe with the False Marking stick

March 10, 2010 3 comments

On March 9, the Public Patent Foundation (PubPat) sued Adobe Systems, Inc. in the U.S. District Court for the Southern District of New York over false marking of various Adobe Reader products.  I think this case is especially interesting because I noticed Adobe’s false marking about two weeks ago on the newest version of Reader, and wondered then if the marking occurred on earlier versions, as well.

PubPat says yes.  In the Complaint, PubPat shows examples of false marking for Adobe Reader versions 7, 8, and 9 (see pp. 5-9).  What may differentiate this false marking case from many others is the presence of multiple mis-marked versions of the same product.

Typically, it seems like proving intent to mis-mark is going to be the highest hurdle false marking plaintiffs will have to traverse.  Usually, there is only one product marked falsely, so the mis-marking could have been unintentional originally and unnoticed continually.  (Courts could make this hurdle lower by implementing a “knew or should have known” intent standard, but that’s a discussion for another day).

Here, however, you have multiple mis-marked versions of the same product, and the markings are not identical.  In other words, someone apparently went through and made a conscious choice regarding each patent that was marked onto each version of Reader.  As well, the newer versions of Reader had brand new patents marked onto them at the same time older patents, either unexpired or inapplicable, were allowed to remain.

One complication that is faced by PubPat is the presence of another lawsuit regarding false marking of the same product.  In the Complaint, PubPat notes:

On Dec. 30, 2009, Defendant was sued, under 35 U.S.C. §292, by an entity named San Francisco Technology Inc. (See San Francisco Technology Inc. v. Adobe Systems Inc., et al., No. C-09-06083 (N.D. Cal., Dec. 30, 2009) (the “SF Tech.” suit)).

The SF Tech. suit alleges, inter alia, that Defendant violates §292 by marking Adobe Reader with expired U.S. Patent Nos. 4,837,613; 5,050,103; D337,604; and D338,907. (See SF Tech., No. C-09-06083 (N.D. Cal., Dec. 30, 2009), ¶¶ 37-42.)

The SF Tech. suit also joins, in the same action, unrelated §292 claims against fourteen other defendants.

[PubPat] does not seek to assert duplicative “expired patent” §292 claims against Defendant in this action. However, [PubPat] believes that the SF Tech. suit may be dismissed on a non-merits ground, such as improper joinder under Fed. R. Civ. P. 20.

This other lawsuit has the potential to make PubPat’s intent case stronger.  In the Complaint, PubPat notes:

[U]pon information and belief, those members of the [Adobe] Compliance Team responsible for §292 compliance have allowed, and continue to allow, mis-marking of the Inapplicable Patents despite actual knowledge that such mis-marking violates federal law.

Indeed, after receiving specific notice, on or about Dec. 30, 2009, that the legality of Adobe Reader’s patent notices had been called into question by the SF Tech. lawsuit, members of the Compliance Team made no substantial effort to correct even the specific deficiencies noted in the SF Tech. complaint (i.e., the expired patents), much less to rectify the larger problem involving the numerous Inapplicable Patents. Accordingly, since at least early January, 2010, Defendant’s marking of expired and inapplicable patents on Adobe Reader has been deliberate and willful, thus making this case exceptional.

The newest version of Adobe Reader (9.3.1) was released with false markings on February 16, 2010.

It will be interesting to see how this case develops.

Categories: False marking Tags: , ,

The Qui Tam Beat Goes On

March 5, 2010 Leave a comment

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Since we last updated this list, the filing of qui tam suits for false marking of patent information has continued unabated.  At some point, we will have to reconsider whether to keep filing posts like this one, or dedicate a single page to false marking suits, or let the astute reader find such suits on his or her own initiative.  It’s becoming rather difficult to keep up with all the new cases.  In that vein, please do not consider this list comprehensive, or authoritative, though we have done our best to make it as complete as possible. 

Though the filing of such suits has not slowed down, whether they will continue to be brought profitably by individuals or small entities remains to be seen.  A Manager’s Amendment to S.515 (the currently-pending patent reform act) would likely do away with most, if not all, of these cases (more info in a later post).

Here is a listing of cases filed since our last post on February 25, 2010 (please note that this list does not include all defendant companies, since only the first-named defendant is included in each entry):

  • Calton v. Procter & Gamble, 10-cv-00406, 2/25/2010, N.D. Ala.
  • Simonian v. L’Oreal USA Creative, Inc., 10-cv-01345, 2/26/2010, N.D. Ill.
  • Roscoe’s Tech. & Nanotech. v. Lyman Prod., 10-cv-00083, 2/28/2010, E.D. Tex.
  • Hollander v. Ortho-McNeil-Janssen Pharm., Inc., 10-cv-00836, 3/1/2010, E.D. Pa.
  • Hollander v. B. Braun Medical, Inc., 10-cv-00835, 3/1/2010, E.D. Pa.
  • Patent Compliance Group Inc v. Avid Identification Sys., Inc., 10-cv-00407, 3/1/2010, N.D. Tex.
  • Patent Compliance Group, Inc. v. Int’l E-Z Up, Inc., 10-cv-00406, 3/1/2010, N.D. Tex.
  • Patent Compliance Group Inc v. InterDesign Inc., 10-cv-00404, 3/1/2010, N.D. Tex.
  • Patent Compliance Group v. North States Indus., 10-cv-00405, 3/1/2010, N.D. Tex.
  • Patent Compliance Group v. Dyson Inc., 10-cv-00419, 3/2/2010, N.D. Tex.
  • FLFMC, LLC v. Wham-O, Inc., 10-cv-00287, 3/2/2010, W.D. Pa.
  • Englehardt v. Costco Wholesale Corp., 10-cv-01424, 3/3/2010, N.D. Ill.
  • Heathcote Holdings Corp., Inc. v. Procter & Gamble Co., 10-cv-01441, 3/3/2010, N.D. Ill. 
  • Perfection Prod. Mgmt, LLC v. Allway Tools, Inc., 10-cv-00459, 3/3/2010, N.D. Ohio
  • Perfection Prod. Mgmt, LLC v. Stanley Works, 10-cv-00452, 3/3/2010, N.D. Ohio
  • Brinkmeier v. Exergen Corp., 10-cv-00176, 3/3/2010, D. Del.
  • Lightspeed Aviation, Inc. v. Bose Corp., 10-cv-00239, 3/3/2010, D. Or.
  • Zojo Solutions, Inc. v. Zircon Corp., 10-cv-01431, 3/3/2010, N.D. Ill.
  • Perfection Prod. Mgmt, LLC v. Homer TLC, Inc., 10-cv-00465, 3/4/2010, N.D. Ohio
  • Perfection Prod. Mgmt, LLC v. Am. Safety Razor Co., LLC, 10-cv-00463, 3/4/2010, N.D. Ohio
  • Simonian v. Playtex Prod., Inc., 10-cv-01455, 3/4/2010, N.D. Ill. 
  • Heathcote Holdings Corp., Inc. v. Leapfrog Enter., Inc., 10-cv-01471, 3/5/2010, N.D. Ill.
  • Heathcote Holdings Corp., Inc. v. Phillips Screw Co., 10-cv-01468, 3/5/2010, N.D. Ill.

Kudos to Lightspeed Aviation for bringing the issue home to the District of Oregon.

[Updated at 11:15am with new Heathcote Holdings cases]

Categories: False marking Tags:

Assembly Line Litigation

February 25, 2010 2 comments

I keep thinking I will stop doing posts listing new false marking cases, at some point, because they just keep coming.  Nevertheless, I keep putting these up because it’s just so interesting to see the initial wave of something that looks like it will change the legal landscape for patents.  The more of these cases that come out, and the more they look like assembly-line litigation, the more I’m convinced that either the legislature or the judiciary is going to push back and make these suits less attractive.

On the other hand, isn’t the rash of suits strong evidence that qui tam actions under 35 U.S.C. Sec. 292 are a good thing?  If, indeed, Congress established that section of the U.S. Code to deputize the public and send us all on a hunt for falsely-marked goods, which represent an abuse of a Constitutional privilege, then it would seem imperative that we, the public, take the reins and do some policing.  The fact that there are so many cases of false marking being found suggests that we, the People, should have been more active in this regard.

In that vein, who, today, is Johnny Law?  Here are 20 more false marking suits filed in the last 48 hours, bringing the total for this year to 52 cases.  Compare that to the 27 cases filed in the last two years.

  • H. N. Akbar v. Procter & Gamble Co., 10-cv-00105-RC, Feb. 23, 2010, E.D. Tex.
  • Bentley A. Hollander v. Ranbaxy Labs. Inc., 10-cv-00793-MMB, Feb. 23, 2010, E.D. Pa.
  • Public Patent Foundation, Inc. v. Quigley Corp., 10-cv-01552-BSJ, Feb. 24, 2010, S.D.N.Y.
  • Public Patent Foundation, Inc. v. Novartis Consumer Health, Inc., 10-cv-01553-CM, Feb. 24, 2010, S.D.N.Y.
  • Thomas A. Simonian v. Pella Corp., 10-cv-01253, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. 3M Co., 10-cv-01255, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. BP Lubricants USA, Inc., 10-cv-01258, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Quigley Corp., 10-cv-01259, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Irwin Industrial Tool Co., 10-cv-01260, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Edgecraft, Corp., 10-cv-01263, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Monster Cable Products, Inc., 10-cv-01269, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Novartis Consumer Health, Inc., 10-cv-01268, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Novartis Animal Health US, Inc., 10-cv-01267, Feb. 24, 2010, N.D. Ill.
  • Thomas A. Simonian v. Global Instruments, Ltd. & Global TV Concepts, Ltd., 10-cv-01293, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Tru Fire Corp., 10-cv-01295, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Darex, LLC, 10-cv-01296, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Merck & Co., Inc. & Schering-Plough Healthcare Products, Inc., 10-cv-01297, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Cisco Systems, Inc., 10-cv-01306, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Novartis Pharms. Corp., 10-cv-01308, Feb. 25, 2010, N.D. Ill.
  • Thomas A. Simonian v. Adv. Vision Research, Inc., 10-cv-01310, Feb. 25, 2010, N.D. Ill.

Of note, this batch of cases brings up an issue that I noted in my first post of this series: What will happen when a defendant is sued multiple times for false marking, in different courts, and by different plantiffs?  Here, The Public Patent Foundation and Thomas Simonian both sued Quigley Corporation and Novartis Consumer Health.

Note: Gene Quinn at IPWatchdog hosts a pseudonymous author’s humorous take on this situation.

Categories: False marking Tags: ,

False Marking Suits Go Bananas

February 23, 2010 1 comment

We noted in a post last week that there has been a dramatic uptick in the rate of filing of false marking suits.  As noted there, false marking suits are qui tam actions filed under 35 USC Sec. 292, with an individual making the claim on behalf of the United States (any monetary award is shared equally between the plaintiff and the U.S.).  We posited (as have others, such as Justin Gray at Gray on Claims) that this uptick may be due to the Federal Circuit’s holding in Forest Group v. Bon Tool that false marking damages shall be awarded on a per-article basis (rather than on a per-occurrence basis), thus raising the possibility of large damage awards.

The rate of filings has continued unabated.  Using the lawsuit classifications of RFC Express, it appears that there have been 14 18 more false marking complaints filed in the last 4 days.

  • Arthur Lee Yarbough v. S.C. Johnson & Son, Inc. & Energizer Holdings, Inc., Feb. 19, 2010, 10-cv-00096, E.D. Tex.
  • Gregory Harrelson v. Stanley Works, Inc., Feb. 19, 2010, 10-cv-00371, N.D. Ala.
  • Advanced Cartridge Techs., LLC v. Lexmark Int’l, Inc., Feb. 22, 2010, M.D. Fla.
  • Patent Compliance Group, Inc. v. Tweezerman Int’l LLC, Feb. 22, 2010, 10-cv-00350, N.D. Tex.
  • Patent Compliance Group, Inc. v. Nutro Products Inc. & S&M NuTec LLC, Feb. 22, 2010, 10-cv-00351, N.D. Tex.
  • Azimuth Unlimited, LLC v. Seatel, Inc., Feb. 22, 2010, 10-cv-60253, S.D. Fla.
  • Thomas A. Simonian v. Mead Westvaco Corp., Feb. 23, 2010, 10-cv-01217, N.D. Ill.
  • Thomas A. Simonian v. Weber-Stephen Prods. Co., Feb. 23, 2010, 10-cv-01220, N.D. Ill.
  • Patent Compliance Group, Inc. v. Hunter Fan Co., Feb. 23, 2010, 10-cv-00359, N.D. Tex.
  • David O’Neill v. Roche Diagnostics Corp., Feb. 23, 2010, 10-cv-01205, N.D. Ill.
  • Thomas A. Simonian v. Pfizer, Inc., Feb. 23, 2010, 10-cv-01193, N.D. Ill.
  • Thomas A. Simonian v. Bunn-O-Matic Corp., Feb. 23, 2010, 10-cv-01203, N.D. Ill.
  • Thomas A. Simonian v. Ciba Vision Corp., Feb. 23, 2010, 10-cv-01202, N.D. Ill.
  • Thomas A. Simonian v. Blistex, Inc., Feb. 23, 2010, 10-cv-01201, N.D. Ill.
  • Thomas A. Simonian v. Fiskars Brands, Inc., 10-cv-01225, Feb. 23, 2010, N.D. Ill.
  • Thomas A. Simonian v. Oreck Corp. et al., 10-cv-01224, Feb. 23, 2010, N.D. Ill.
  • Thomas A. Simonian v. Merial LLC et al., 10-cv-01216, Feb. 23, 2010, N.D. Ill.
  • Thomas A. Simonian v. Kimberly-Clark Corp. et al., 10-cv-01214, Feb. 23, 2010, N.D. Ill.

This listing makes crystal clear that at least some people (or entities) are making a serious go of it in searching out falsely marked goods.  If businesses needed any more encouragement to review their patent portfolios and package markings, this should be it.  Any falsely marked good is now like big game to the false marking hunters.

[Updated at 10:26pm to add a 14th complaint]

[Updated 7:00am Feb. 24, 2010 to add more]

Categories: 35 USC 292, False marking

False Marking Suits Take Off

February 17, 2010 2 comments

I wanted to take a moment to note recent developments in false marking lawsuits under 35 USC Sec. 292.  This issue has become especially interesting to me because I ran across a case of false marking over the weekend, when I was buying Valentine’s Day gifts for my girls.

As noted by this article from Courthouse News, there were about 15 false marking lawsuits in 2008 and about 12 in 2009.  However, in late 2009 the Court of Appeals for the Federal Circuit decided the case of Forest Group v. Bon Tool (decision here) (PDF), in which it held that false marking penalties of up to $500 are to be assessed on a per-article basis. (For an excellent summary of the case by Robert A. Matthews, see this post at Patent Baristas).  As part of the Forest Group decision, the Federal Circuit commented that there could be a “cottage industry” of litigants who have not suffered any direct harm.  (This is a debatable statement, or perhaps short-sighted, but it is not my intent to dissect the comment here)

So, is there now a cottage industry of false marking suits?  Sure looks like it. Since January 1st, here is a listing (perhaps complete) of 14 false marking suits:

  • Brinkmeier v. Bayer Healthcare LLC, Jan. 3, 2010, D. Del.
  • Hollander v. Hospira, Inc., Jan. 15, 2010, E.D. Pa.
  • Heathcote Holdings Corp. v. Crayola LLC, Jan. 19, 2010, N.D. Ill.
  • Hollander v. Timex Group USA, Inc., Jan. 29, 2010, E.D.
  • Hollander v. EUSA Pharma (USA), Inc., Feb. 2, 2010, E.D. Pa.
  • Hollander v. Etymotic Research, Inc., Feb. 5, 2010, E.D. Pa.
  • Heathcote Holdings Corp., Inc. v. The Clorox Co. & Brita Products Co., Feb. 11, 2010, N.D. Ill.
  • Josephs v. Federal-Mogul Corp., Feb. 12, 2010, E.D. Michigan
  • Zojo Solutions, Inc. v. Leviton Mfg. Co., Inc., Feb. 12, 2010, N.D. Ill.
  • Patent Compliance Group Inc. v. Timex Group USA Inc., Feb. 12, 2010, N.D. Texas
  • Patent Compliance Group, Inc. v. Activision Publishing, Inc., Feb. 12, 2010, N.D. Texas
  • Patent Compliance Group Inc v. Brunswick Corp., Feb. 12, 2010, N.D. Texas
  • Josephs v. Sigma-Aldrich Corp., Feb. 16, 2010, E.D. Michigan
  • Patent Compliance Group, Inc. v. Wright Medical Tech., Inc., Feb. 16, 2010, N.D. Texas

Two things I conclude from reviewing this list:

  1. The awareness of false marking as a viable claim, with damages calculated on a per-item basis, may have influenced the frequency with which it is asserted, and
  2. False marking lawsuits may turn into a cottage industry for groups or individuals who will seek out and file these suits (in other contexts, these groups or individuals are referred to as “trolls”).

One situation that will need to be resolved is how to deal with multiple lawsuits against a single defendant over the same product(s) and patent(s) (for example, the two suits against Timex listed above).  Would some sort of estoppel or preclusion apply, such that only the first-filed lawsuit moves to completion?  Will a defendant found to have marked falsely be entitled to a credit for damages already paid to one plaintiff?  Will the cases be combined and the proceeds divided up between plaintiffs?  My original thought is that some sort of issue preclusion should apply in favor of the defendant (since some courts will bar the second action even in the absence of mutuality of parties).

In a climate like this, what should patent holders consider?  First, a system like this one from Ocean Tomo (which is used to manage a patent portfolio and its markings) may be a good investment for a sizable company.  Second, if a company is not going to invest in a patent-marking management system, it should dedicate at least some amount of time to a review of its patent portfolio and product packaging to ensure that each patent noted on a product’s packaging is both a) in force, and b) has at least one claim covering the product.

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