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Client Alerts

Pequignot v. Solo Cup: Refining the False Marking Landscape

June 11, 2010

Client Alerts

Pequignot v. Solo Cup: Refining the False Marking Landscape

June 11, 2010

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Pequignot v. Solo Cup: Refining the False Marking Landscape
Pequignot v. Solo Cup: Refining the False Marking Landscape
On June 10, the Federal Circuit issued its highly anticipated opinion in Pequignot v. Solo Cup Co., further interpreting the false marking statute, 35 U.S.C. § 292. The court held that (1) marking a product with an expired patent number satisfies the “unpatented article” prong and (2) being aware that a patent marking is false is insufficient to prove “intent to deceive the public” if a defendant “can prove that it did not consciously desire the result that the public be deceived.”

After the flood of false marking cases since the Federal Circuit’s December 2009 decision in Forest Group, Inc. v. Bon Tool Co., the Pequignot v. Solo Cup decision has been much-awaited. The two issues on appeal are emphasized in the statutory language of § 292, below:

Whoever marks upon … 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.
We turn now to an examination of both phrases and the court’s treatment thereof.

1. A Product Marked With an Expired Patent Number Is an “Unpatented Article.”

Solo Cup marked several products with expired patent numbers and argued that those products were not “unpatented” because the listed patents covered the products before expiration. The court rejected this argument –

We agree with Pequignot that an article covered by a now-expired patent is “unpatented.”    As the district court pointed out, “[a]n article that was once protected by a now-expired patent is no different [from] an article that has never received protection from a patent. Both are in the public domain.” (citations omitted) … As it is no longer patented, the public need not fear an infringement suit any more than if it were never patented. Id. at 9.

The court also rejected Solo’s argument that the statutory legislative history suggests that Congress did not intend the statute to apply to articles marked with expired patents, as it could have been unequivocal “by changing the word ‘unpatented’ to ‘not at the time secured by a patent.’” Id. at 9-10. Accordingly, the court found that Solo did falsely mark the articles in question, and it proceeded to analyze the intent requirement of the statute.

2. Knowing That a Marking Is False Does Not Constitute an “Intent to Deceive the Public.”

The Solo Cup court concluded that there is a difference between knowing that a marking is inaccurate and intending to deceive via that marking. Affirming the district court, the Solo Cup court relied on the rebuttable presumption of intent to deceive from Clontech Labs., Inc. v. Invitrogen Corp. (Fed. Cir. 2005) (reasoning that knowledge of an inaccurate marking “creates a rebuttable presumption of intent to deceive the public, rather than irrebuttably proving such intent.”) Op. at 11. Cautioning against self-serving, retrospective statements as to the lack of intent, the court was persuaded that Solo Cup did not have the requisite intent on the facts at hand. Id. at 12.

The court admonished that “[t]he bar for proving deceptive intent here is particularly high, given that the false marking statute is a criminal one.” Id. at 12. The court was persuaded by Solo’s course of action to gradually retire the worn-out molds responsible for stamping the expired patent numbers, which reflected a “good faith reliance on the advice of counsel and … a desire to reduce costs and business disruption,” and that there was not “a scintilla of evidence” of deceptive intent. Id. at 14-15.

3. A Change of Course on Conditional Language – “May Be Covered by One or More of the Following Patents”?

The panel also found “highly questionable” whether Solo’s use of the conditional language “may be covered by one or more of the following patents” was capable of resulting in deceit. Id. at 16. This aspect of the decision may represent a change of course from Clontech, in which the court focused not on the reasonableness of the facts surrounding the marking, but on whether “at least one claim of each patent with which the article is marked” covers the product. 406 F.3d at 1352.

The Solo Cup decision thus reflects this panel’s greater tolerance for explicit falsity, so long as surrounded by indicia of reasonableness and not likely to lead to deceit. Also as with any Federal Circuit panel decision, these predilections are highly panel-specific, as this array demonstrates: Solo Cup: Lourie (author), Rader, Gajarsa; Bon Tool: Moore (author), Rader, Plager; Clontech: Clevenger (author), Dyk, Prost.

© Copyright 2010 Fish & Richardson P.C. These materials may be considered advertising for legal services under the laws and rules of professional conduct of the jurisdictions in which we practice. The material contained in this newsletter has been gathered by the lawyers at Fish & Richardson P.C. for informational purposes only and is not intended to be legal advice. Transmission is not intended to create and receipt does not establish an attorney-client relationship. Legal advice of any nature should be sought from legal counsel. For more information about Fish & Richardson P.C. and our practices, please visit www.fr.com.

 

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