Patent Law Practice Center

Recent Developments and Potential Changes in the Litigation of False Marking Claims Under 35 U.S.C. § 292

Federal Circuit Adopts Heightened Pleading Standard in False Marking Cases

It’s likely that there were many patentees doing  a victory dance yesterday when the Federal Circuit  imposed a stricter pleading requirement in false marking cases.  In the In re BP Lubricants USA decision, the Court held that plaintiff’s must now plead with particularity the specific facts underlying the false marking allegations.  Foley & Lardner Partner and Practice Center Contributor Jeanne Gills sent in this alert which discusses the decision and what effect it may have on both pending and future false marking cases.

On March 15, 2011, the Federal Circuit held that “Rule 9(b)’s particularity requirement applies to false marking claims and that a complaint alleging false marking is insufficient when it only asserts conclusory allegations that a defendant is a ‘sophisticated company’ and ‘knew or should have known’ that the patent expired.” In re BP Lubricants USA Inc., No. 2010-M960, at *1 (Fed. Cir. Mar. 15, 2011). In granting BP Lubricants’ mandamus petition (in part), the Court agreed that this case “warrant[ed] the extraordinary remedy of mandamus” since the Court had not previously decided “whether Rule 9(b) applied” or “discussed the requisite level of pleading required.” Id. at *11. The Court directed the district court to dismiss the relator’s complaint with leave to amend in accordance with 9(b)’s pleading requirements. Id. This decision may lead to the dismissal of similarly pled complaints filed by other qui tam plaintiffs. (more…)

False Marking Statute Ruled Unconstitutional by Ohio District Court

Mayer Brown’s Partner James R. Ferguson passed along this article he wrote with colleagues Richard M. Assmus and Emily C. Melvin on the recent Unique Product Solutions v. Hy-Grade Value decision wherein Judge Polster of the U.S. District Court for the Northern District of Ohio struck down the false marking statute as violating the “Take Care” Clause of Article II of the U.S. Constitution. The article discusses how the decision could affect the numerous false patent marking cases pending in district courts throughout the country.

The Northern District of Ohio has become the first court to strike down the qui tam provision of 35 U.S.C. § 292. Employing the “Take Care” clause of the Constitution, Judge Dan Aaron Polster ruled on February 23, 2011, that the false marking statute lacks the statutory controls necessary to pass constitutional muster. Unique Product Solutions, Ltd. v. Hy-Grade Valve, Inc., Case. No. 5:10-cv-1912 (N.D. Ohio, Feb. 23, 2011). (more…)

Qui Tam Plaintiffs Have Standing to Sue for False Marking under 35 U.S.C. § 292

Mayer Brown’s Partner James R. Ferguson passed along this article he wrote with colleagues Richard M. Assmus and Emily C. Melvin on the recent Stauffer v. Brooks Brothers, Inc. decision.  The article discusses how the Stauffer decision may effect the large number of false marking suits now pending in district courts.  According to the authors, “although the Stauffer decision will not stem the tide of false marking suits – as many patent owners had hoped – several options remain for defending against these actions.”

The US Court of Appeals for the Federal Circuit has ruled that qui tam plaintiffs have standing to sue for false marking under 35 U.S.C. § 292. Stauffer v. Brooks Brothers, Inc., No. 2009-1428 (Fed. Cir. Aug. 31, 2010). Issuing a blow to patent marking defendants, this ruling is sure to impact the flood of cases currently pending in district courts, many of which were stayed pending resolution of Stauffer.

Raymond Stauffer—a patent lawyer himself—brought the suit after he discovered that several bow ties he purchased from Brooks Brothers were marked with two expired US Patents. The district court dismissed Stauffer’s suit for lack of standing, holding that he had not sufficiently alleged an injury to the United States and that any allegations that the alleged false marking quelled competition were too conjectural or hypothetical to constitute injury in fact. (more…)