A company that falsely marks or advertises a product as patented “for the purpose of deceiving the public” can be held liable to the government for “not more than $500″ for each offense. 35 USC 292. The statute gives standing to “any person” to sue and collect one-half of the award.
Forest Group originally sued Bon Tool for infringement of its patent on stilts used primarily in construction work such as hanging drywall. Forest’s claims were dismissed on summary judgment for lack of infringement.
Based on the court’s claims construction, It turns out that Forest Group’s stilts are not covered by its own patent either. You see, the asserted patent requires “a resiliently lined yoke” but Forest Group’s products (marked as patented) do not include that element.
The court found a false marking elements were met, but refused to find false advertising under Section 43(a) of the Lanham Act because Bon Tool did not prove that the deceptive marking was “likely to influence the purchasing decision” of consumers.
On damages, the court awarded only $500 (with $250 going to the government) because Bon Tool could point to only one factory-order of marked products after Forest Group had “knowledge” that its stilts were not covered by the listed patent.
“That single decision constitutes a single offense for purposes of calculating damages under § 292. The Court assesses a penalty in the amount of $500.00 against Forest pursuant to § 292(b).”
The case is on appeal at the Federal Circuit. Patent Attorney Paul Hletko filed an amicus brief in that appeal arguing that damages should be applied on a per-article basis. Hletko’s company Heathcote Holdings sued Church & Dwight for false marking of its Mentadent products.