McDonald Hopkins Law Firm Alert: Court Finds Patent False Marking Statute Unconstitutional
CLEVELAND, Feb. 24, 2011 /PRNewswire/ -- In a landmark decision on February 23, 2011, the U.S. District Court for the Northern District of Ohio ruled that the qui tam portion of the patent false marking statute (35 U.S.C. Section 292) is unconstitutional because it lacks "sufficient control" for the President of the United States to "take care of the laws of the United States" as required by Article II of the United States Constitution. Unique Product Solutions, Ltd. v. Hy-Grade Valve, Inc., Case No. 5:10-cv-1012.pdf (N.D. Ohio 2011).
In the past few years, the number of patent false marking suits has increased to the point where it has become a cottage industry. This recent explosion stems from a ruling by the Federal Circuit that the statute's civil penalty provision allows recovery of up to $500 for each occurrence of a false marking. In other words, for every product sold that has been marked with an expired patent, the defendant may be liable for up to $500 for false marking. Since that ruling, attorneys and companies formed solely for the purpose of filing false marking suits have scoured for products marked with expired patents and filed hundreds of patent false marking actions across the country. The goal of those suits has been to force companies having marked their products with expired patents into quick settlements.
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