Qui Tam - False Patent Marking

False Patent Marking

It is an offense under 35 U.S.C. § 292 (the "False Marking Statute") to falsely mark goods as "Patented." Before the enactment of the America Invents Act, any person could sue for breach, and the penalty of up to $500 was shared between the government and the person suing. Frequently, patentees fail to remove patent markings from their products following the expiration date of their patents and continue to mark goods sold after that date as patented. This behavior was largely overlooked until a court held that a separate penalty was due for each such article sold. This inspired a host of similar lawsuits.

In 2011, the United States District Court for the Northern District of Ohio held that the False Marking Statute was unconstitutional. Judge Dan Aaron Polster determined that it violated the Take Care Clause of Article II of the Constitution, because it represented "a wholesale delegation of criminal law enforcement power to private entities with no control exercised by the Department of Justice".

The America Invents Act made significant changes to false marking laws, which affected all pending and future false marking actions:

• Only the U.S. government can now sue for the civil penalty authorized in § 292.
• Private entities can still sue, but only for compensatory damages. These plaintiffs must prove actual competitive injury from the false marking.
• It is no longer a violation to mark a product with an expired patent, as long as that patent once covered the product.