Curbing Trolls by Reforming the Patent Marking Statute

Guest Post by François deVilliers, Chief IP Counsel, Plantronics, Inc.

35 U.S.C. 287(a) provides that constructive notice of a patent may be given by marking the patented article with the patent number, and that “In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice.”

This section is badly structured – instead of affirmatively specifying the requirements for infringement damages to accrue, the drafters addressed this issue in the negative sense only after specifying first that an article may be marked. This of course begs the question, what if there is no article to mark?

There is no duty to mark or to give notice in lieu thereof “if there is no product to mark,” as held by the Supreme Court in Wine Railway Appliance Co. v. Enterprise Railway. Equipment Co. (1936)(interpreting the predecessor statute) and by the Federal Circuit in Texas Digital Systems., Inc. v. Telegenix, Inc. Damages accrue from the moment infringement of the issued patent commences, with a six year “statute of limitations” provided in 35 U.S.C. 286.

The logic is supposedly that “[t]wo kinds of notice are specified–one to the public by a visible mark, another by actual advice to the infringer. The second becomes necessary only when the first has not been given; and the first can only be given in connection with some fabricated article. Penalty for failure implies opportunity to perform.” (Wine Railway.)

This has led to the odd situation in which a company that is vigorously engaged in the rough and tumble of commerce with its patented product, benefiting consumers, creating jobs and increasing GDP, is in a less favorable position than an entity that does nothing. What was intended to be beneficial (notice is deemed to be given by marking) has advanced the interests of the patent troll over those of the operating company.

Trolls exploit this odd situation by waiting for industries or standards to become established, or for sales to accrue, before presenting their now-inflated licensing demands. Finding a previously ignored or forgotten asset, the clichéd “Rembrandt in the attic,” is similarly rewarded. “The patent might be expiring, but we’ve got ya going back six years, buddy!”

By the time this delayed claim is presented, the alleged infringer or standards-setting body has had no opportunity to mitigate the effect of the claim by adopting different technology or taking other steps. They’re stuck with the cost and disruption of trying to resolve a claim that might not have existed, or might have existed on a much smaller scale, had they received timely notification of the patent. Dubious claims are also more intimidating, merely because of the amount at issue. The alleged infringer is penalized by the delay, while the idle or covert or brand-new patent owner benefits.

Such exploitation also contravenes a fundamental goal of the marking statue, which is to protect against innocent infringement. Nike, Inc. v. Wal-Mart Stores, Inc. (Fed Cir 1998).

But, you may say, what of the inventor in the garage, who doesn’t have the needed capital or expertise to commercialize their patent? What if a company is exploiting the patented technology in a faraway city? Shouldn’t this inventor be entitled to fair compensation? Of course. But that is what the internet and its search engines are for. Times have changed – if someone is making money off a patented product, a patentee will be able to find it and send a notice letter. At a minimum, even if the patent is not directed to a findable product, it is easy enough to identify likely infringers or companies that might be interested in licensing the patent.

The onus should be on the patent owner to assert their rights – use it or lose it. A simple patent reform could affirmatively specify that damages only accrue after actual or constructive notice, and that constructive notice can be given by marking. If it is not possible to mark, then actual notice should be required. Patent numbers for method patents can be included on products produced by the method, on devices that practice the method, in documentation accompanying software that practices the method, or on websites or in apps that practice the method. If it is really impossible to avail yourself of the benefit of constructive notice by marking, then the onus is on you to police your rights.

It is amazing that nobody has addressed this issue in current patent reform efforts directed to curbing the patent troll problem. The marking statute should protect innocent infringers and it doesn’t. Marking should benefit those who practice the patent, but the current state of the law benefits those who don’t.

 

100 thoughts on “Curbing Trolls by Reforming the Patent Marking Statute

  1. 22

    The inventor in the garage can’t send a letter because they will get DJ’d and without counsel willing to invest millions (which won’t happen until the infringing standard or product is widely used) they will lose their patent rights.

    This idea is a sop to infringers. But then again, the author already knows that.

    1. 22.2

      There is no shortage of contingent fee attorneys and PAE ‘s these days willing to represent small inventors who have with legitimate patent claims against such “widely use” infringing product. That does not require that kind of money from the patent owner. Even the PAEs typically do not need to spend that much for the 97% of defendants that settle before trial, since the burden of proof on all issues except infringement itself is strongly on the defendant, not the patent owner.

      Likewise, I have not seen any actual, statistical, evidence of such allegedly widespread filing of expensive D.J. D.C. suits in response to mere licensing offers from small entities.
      This would make a useful study for a patent law academic, including statistics on the % of patent suits started by a D. J. compliant as compared to patent suits started by a patent owner infringement complaint.

      1. 22.2.1

        There is a tremendous shortage of contingent fee attorneys willing to pay out of pocket costs, and an even greater shortage of attorneys willing to handle IPRs on a contingent fee basis. And the number drops to roughly zero when you’re talking about patents before they are widely adopted in the marketplace.

          1. 22.2.1.1.1

            If client is able to cover out of pockets and pay for patent office proceedings, it’s easy to find counsel. Otherwise, not so much…unless the case has the potential to put a big number on the board.

            1. 22.2.1.1.1.1

              If we take your position as given for argument’s sake, would you agree with the two following statements/consequences:

              A) Any “improvement” or lowered litigation expense measures will result in MORE cases being brought forward in the courts.

              B) Lacking “improvement” or generally for those for whom litigation (that is, the accepted legal manner of enforcing patent rights), is not “cost effective,” the option of selling the property to another that is better positioned to enforce is more likely (i.e. so-called Troll growth is promoted).

              Your thoughts….?

  2. 21

    Question: In what percentage of the reported cases have trolls (NPEs) been awarded additional damages for willful infringement? Has anyone done the research (yet) on this? Perhaps the notice issues should be considered in this context. (Intentional continued infringement economically trumps more expensive design around efforts if anticipated reasonable royalties are in fact, reasonable and the removal of ANY form of injunctive relief for NPEs assures that if “wild cards” like enhanced damages and attorney’s fees are also out of the picture; is that the way it is, in real life, becoming? Is that the way it should be? All asked politely.

    1. 21.1

      Any polite answer would include the notion that conscripted forced licences (compulsory licensing) should be treated as anathema to both freedom to contract and the meaning of the word “exclusive.”

      Also, a polite answer would also bring into the discussion the current attempts to make “efficient breach” more, um, ‘palatable’ by ignoring the (still controlling) notion from the 1908 Supreme Court case that held that a patent holder cannot be forced to use (or let others use) items/methods covered by the patent during the limited time that the patent right is in force.

      Such is simply outside of the Quid Pro Quo.

    2. 21.2

      Jack, it seems the new troll paradigm is to sue first and then negotiate. So, I don’t think you are going to find many cases where the defendant was notified of his or her patent infringement and did not engage counsel to provide advice on whether the patent was invalid or not infringed. We all know that such opinions can be obtained from any patent attorney for a price.

      The real question is whether they can obtain damages for 6 years past. This is hard to do if they have licensees, as the licensee is obligated to mark the licensed patent on covered products, and if they do not, the troll cannot collect past damages.

      In other words, the typical troll is in the same position as the seller of products, he has to give actual notice.

    3. 21.3

      While marking might be of some assistance, I believe a more fundamental fix would involve adopting the concept of “use” from trademark law into the patent laws. We examine use now only in the context of damage assessment, i.e. in determining whether a royalty or lost profits might accrue.

      1. Require a statement of use for the payment of maintenance fees. Allow for extensions of time as well, but charge well for them.

      2. Use can be established by legitimate (not a sham) licensing agreements concerning the patent or by use in commerce of products/methods subject to the patent in question.

      3. Damages for a patent that is not in use should not be available.

      4. The question of use should be subject to the same high burden as invalidity.

      5. Failing to establish use should not be dispositive of future enforcement provided fraud was not present in the payment of maintenance fees.

      Pro’s include reducing the ability of trolls to raise hell, focusing patent protection on IP that is important enough for patentees to invest in it, putting into the public domain more technology, and you litigators will have a whole bunch of new issues to argue about.

      The Con’s pretty much mirror the Pro’s. Using the concept of “use” would make it harder to stockpile IP and would reduce corporate good will, but would favor folks good at product development over those that are good at patent litigation.

      CJ

      1. 21.3.1

        CJ,

        “Use” is dead on arrival.

        I have mentioned why several times. Please try to come up to speed.

        1. 21.3.1.1

          anon:

          I cannot disagree with the sentiment that “use” is unlikely to be adopted. But since I’ve already got my entire post printed on the reverse side of my “Audit the Fed” protest sign, I may as well keep throwing it out there from time to time.

          CJ

        2. 21.3.1.2

          The problem with “use” is that many inventors (individuals not at inception associated with any NPEs) are good at inventing and they do invent in the hopes that some “use” will come of their new, novel, and non-obvious invention. And, they do the work, spend the time, and invest the money in getting the patent. They hope by doing so, they will get there; but, the reality is that __% of the time they are wrong and they are either too early, too late, too expensive, or too whatever but they did, in fact, invent first, file first, and invest first.

          The current patent law provides incentives for even such inventors to stay the course. Royalties first arising even 10 years later (long beyond what might be viewed as “abandonment” in the trademark sense) give incentives to these folks. Adding a “use” requirement might well chill the entire inventive process OR lead to far more trade secret retentions. Which is better?

          Note: in the copyright context, after 35 years, an assignee who may have done nothing other than assign (or exclusively license) a copyrighted work, can terminate a transfer — EVEN AS AGAINST AN ACTIVELY USING ASSIGNEE (OR EXCLUSIVE LICENSEE) — so at least in the copyright area there is a recognition that the creator of copyright (IP) rights has the ability to take control back EVEN IF THE INTENT OF THAT OWNER IS TO SIMPLY DISCONTINUE PUBLICATION OR OTHER USE OF THE WORK! (Though I will agree with you that the intent of the termination of transfer provision of the Copyright Act is arguably the opposite: to assure that the copyright owner gets a second chance to exploit what might have been a bad first deal or one where the assignee is doing little to exploit/use)

          How does the trademark-based “use” theory square with this approach in the copyright area? (Note: in the trade secret area, there is a concept of economic value that implies that there are at least some “use” cases but I know of nothing that requires the owner of a state law protected trade secret to actually license or otherwise “use” the trade secret; couldn’t the Coca-Cola inventor simply decided to keep the formula secret and never share it with anyone? (Imagine what a different (less obese) planet we might have had that been so! (smile))

    1. 20.1

      Mr. New Jersey, unfortunately the writer of the article got everything backwards. The default rule for patents is that there is no innocent infringement. That has been the default rule in the United States from the very beginning and was recognized by the Supreme Court in Wine Railway.

      Back in the day when copies of patents were not online and easily available to the public, it often happened that competitors would simply copy the products of their competitors not assuming that they were patented. In order to prevent such “innocent” copying from inadvertently putting the copier in a damages position, Congress provided that the patent owner might mark his product with the patent number to give notice. Obviously the intention was to help the public avoid patent infringement, but was specifically intended to allow the public to copy products of their competitors that were unmarked, with the assumption that they were not patented because they were not marked.

      But in today’s modern world, everyone patents their products, and no one in their right mind would copy their competitor’s product thinking the products were unpatented. Nevertheless, the products of most large companies are not marked with patents. Why? Most large companies must cross license their patents. This prevents them from marking with effect because their licensees must mark as well; and as we all know, cross licensees will not mark their products with the patents of their cross licensee, thereby preventing them from collecting damages regardless that they might mark their own products. This to me is the problem with the current marking statute.

      But once again it is the default law in United States that there is no innocent infringement. But as a practical matter, one may copy the products of big companies almost with impunity because of the marking statute. This is perversity on display. If there is reform, we should fix this.

    2. 20.2

      Yes, it makes perfect sense. If an identity thief opens a credit card account in your name and charges 100 a month he shouldn’t be charged with theft until you serve him notice that he is not you and should not be using your identity. Additionally, he shouldn’t have to pay for any charges he made prior to receiving notice.

      1. 20.2.1

        good points Les, except they can be modifed somewhat as an important distinction arise with criminal mens rea versus the patent model of strict liability.

        1. 20.2.1.1

          How is this a good point? The person who steals another’s identity is clearly doing something wrong. You can’t say the same about patent infringement. If there’s actual copying, then yes. If the infringer independently created a product that is covered by claims of the patent, then no. The infringer is still an infringer. Yes, patent infringement is strict liability. But you can’t equate it with ID theft. The public policy is completely different here.

          1. 20.2.1.1.1

            You can’t say the same about patent infringement.

            Yes. You can.

            What part of “strict liability” do you not understand?

            Or are you doing that ‘plain-English-but-not-the-law’ thing again?

            1. 20.2.1.1.1.1

              You seem to have problems reading. When someone makes a public policy statement, you attack based upon the current state of the law if you disagree. Of course, when your public policy statements are not in accord with the law, then it’s okay.

              Also, there is a section 287 still, right? That’s true even though you don’t like it. So the statute is not pure strict liability.

              Anyway, I don’t have time to post here 50 times a day. I’ll leave you to be your unpleasant self with others that do.

            2. 20.2.1.1.1.2

              Of course, when your public policy statements are not in accord with the law, then it’s okay.

              LOL – you want to try again with that not in accord with law means that it is ok thing? You left out quite a bit to make that ring true.

            3. 20.2.1.1.1.3

              …because when I say something not in accord with the law (as when I discus Nuitjen, I make sure that it is known that I am not trying to pass something off as actual law.

              The problem reading here is not with me, my friend.

  3. 19

    Let’s set the context (the legal context, not the purely English language (?) context**) of the Nike case.

    The Nike case concerned a design patent – which in itself can be taken as ‘marking,’ as the appearance IS the patent (as well as the legal evolution including “ and continues to be so used although such recovery is now limited to design patent infringement.

    A second point to keep in mind is that the item so affected (shoes) tends to be conflated with fashion – a realm of mixed protection at best.

    A third point is that the Nike case concerned a situation of products and timelines that exhibited a mixed bag of marked and unmarked items.
    287 (a) contains the permissive “may.” What is often lost in the shuffle (and purposefully obfuscated during the run-up to the AIA changes) is the legal point that marking is NOT a right, but a privilege. With the privilege of marking comes both power and responsibility. Sure, the AIA sought to blunt the responsibility incurred with marking, but make no mistake of the legal nature that marking has. A student of history would recognize the early faltering step of requiring marking and the change to making marking not a requirement but a privilege.

    To the (valid) legal point raised by Paul Morgan, mere publication of a patent is NOT considered notice. This is true. However, a much better policy position can be made for changing this part of the law. I have offered this change in the law on several prior occasions (noting that such would be a change in the law, btw). It would be in close accord with the purpose of even having a patent system to take the policy position that the publication of a patent be accorded the full presumption of notice. That is the very reason why patents are published, and this presumption would encourage the public to take heed of patents being published, rather than the current manner of assigning treble damages which has the (unforeseen consequence of market players actively discouraging their employee/inventors from referencing the published patent data (and I can attest to this ‘directive’ firsthand). We would be well advised to return then to the original state as noted: “ The early patent statutes contained no marking requirement. As explained in Boyden v. Burke, 55 U.S. (14 How.) 575, 582-83, 14 L.Ed. 548 (1852), patents were public records and all persons were “bound to take notice of their contents.”

    We should return to that era of clear understanding.

    Another point is that the discussion involves remedies (as opposed to rights) – “applies when the requested remedy .” As pointed out (several times now), one should pay attention and not conflate a right with its remedy. Especially where, as here, alternative remedies exist.

    The issue in the Nike case is more focused on “damages” and “profits.” A point not in consideration of the present discussion.

    Always a red flag: “Our inquiry into the parallel but separate evolutions of the marking statute and the remedies statutes has led us to an interpretation that departs from the plain words of the statute.

    Such reminds one to ask the question: How deep the rabbit hole of ‘implicit?’
    Further, an “English language” view short shrift of legal context would likely misunderstand the historical factor of “The first patent statutes reflect the separation of law and equity, carried over from the English common law of patents. ” (one is further reminded of modern day deconstructionists of patent rights – they do not bleed and the ‘miss’ of such views and the nature of these right as evidenced by the notion of “ manifest injustice”)

    Recovery of a “floor” level is not equivalent to saying that that floor level is the best recovery – such is a minimum starting point – not the aim and final resting point.

    The historical separation indicates that the person SEEKING recompense had his option of which path to pursue. The immediate writer would turn that notion on its head and speaks in favor of infringer’s rights.

    The infringer’s rights handbook tactic of speaking as if one already had rights – and those presumed rights are in jeopardy is clearly in play here.

    On to Wine Ry…

    At issue there is an accounting on a counterclaim. The case clearly focuses on a different issue than for which the immediate author wishes to draw his point on. (and to my earlier ‘policy’ point, one cannot mistake this quote from that case: “ The parties agree that issuance of a patent and recordation in the Patent Office constitute notice to the world of its existence. Boyden v. Burke, 14 How. 575, 582, 14 L.Ed. 548; Sessions v. Romadka, 145 U.S. 29, 50, 12 S.Ct. 799, 36 L.Ed. 609.”)

    As used in that case, the dicta of “innocent infringement” is particular to the discernment of differentiating when notice has been provided. It is clearly not used to indicate that the act of unknowing infringement is something that is “OK” in and of itself, much less something that would (or should) be allowed to continue after the issue is brought to the attention of the alleged infringer. In no way can a “continue-to-infringe” notion be taken from the case. “That section subtracts something and creates an exception.” – it does not swallow the rule. To wit: “ If respondent’s position is correct, process patents and patents under which nothing has been manufactured may be secretly infringed with impunity, notwithstanding injury to owners guilty of no neglect. Only plain language could convince us of such an intent.

    For the present counsel to cite a case, and then ignore a key provision such as “ By admission, the act of 1861 did not require a patentee who did not produce to give actual notice to an infringer before damages could be recovered; and there is nothing in the language or history of the act of 1870 sufficient to indicate an intent to alter his position in this regard.” speaks extremely poorly for that counsel.

    .

    ** – It is a clear sign of pedanticism when one desires to focus on “English usage” in isolation of legal meaning. The, um, ‘student’ so advocating needs to return to the realm of the Ivory Towers and contemplate why this is so.

    1. 19.1

      Anon, I must agree with everything you said. And I must admire your effort to set the record straight. By citing history, and the details of the case, you’re becoming much more persuasive. Keep up the good work.

      But back to the case at hand, I have to agree that the poster not only did not understand the law of marking, but did not understand the general principles that there is no innocent patent infringement in the United States. Long ago the Supreme Court decided that knowledge of the patent or knowledge of the infringement was irrelevant to patent infringement. Infringement was a strict liability tort. If you did it, you infringed and you owed the patent owner damages.

      The marking statute was designed to be an exception to the this rule so that purveyors of products could only collect damages if they marked. The statute doesn’t read that way, but that has developed into law. Thus the purveyor products is penalized unless they mark, and in my opinion, this is overly harsh – and if there’s anything that should be fixed, it is this. The purveyor products should not have to mark in order to collect damages so as to place them on an even footing with everybody else.

      1. 19.1.2

        Ned, the author’s understanding of the current law of marking is irrelevant because he is proposing that Congress completely rethink it. The point of his post is to propose that:

        “A simple patent reform could affirmatively specify that damages only accrue after actual or constructive notice, and that constructive notice can be given by marking. If it is not possible to mark, then actual notice should be required.”

        It appears, Ned, that you’ve missed the point in an attempt to brag about your infinite knowledge of the present state of marking law.

        1. 19.1.2.1

          I heart IP, I know you think that that is all he is suggesting is that we change the default rule from one where one can collect damages for six years past absent notice, to one where one cannot. But what I object to is everything he says about trolls in his post is completely wrong. Trolls are in the same position today as a seller of unmarked products because they have licensees who make and sell unmarked products. His solution addresses a nonexistent problem and the change of the default rule can only cause collateral damage to the patent system. Changing the law without a very good reason to do so is always, emphasize always!, a very, very, very bad idea.

  4. 17

    Not all these trolls sat back and watched the technology develop. A few of them tried to go to market and were driven to bankruptcy by their larger competitors who refused to license a patent from a mere startup. After bankruptcy nothing was left but the few patents from the startup. Was it wrong for the creditors to go up against the large competitors that drove the startup to bankruptcy?

    The litigation between Freedom and BCGI re prepaid cell phone tech 10 years ago comes to mind.

    1. 17.1

      Frequent_runner, trolls do not “wait” until the market develops. That simply is crazy. As noted in the linked article by the poster, there are a lot of so-called “Rembrandts in the attic.” What this article describes are patents in the portfolios of large corporations that no longer cover businesses of that company, and are otherwise not doing anything for their proprietor except incurring expenses. These so-called Rembrandts are increasingly being sold to licensing houses that make money for their proprietors. These Rembrandts might have been sitting in the attic for quite a period of time while the market developed, but they were not sitting there in the attic because the proprietor was a troll or because of some malicious intent by the proprietor. They were simply there and ignored.

      As I noted another post, if one has a patent and one knows of infringement, one has a duty to act; and if one does not, that is latches or abandonment. No patent owner in their right mind would therefore sit idly by watching infringement developed because if they did so they would lose their patent.

  5. 16

    May I also politely suggest that the poster is misleading his audience by suggesting that a troll may collect damages for six years past simply because the troll itself is not making products. The problem with this assertion is that is contrary to law. If the troll licenses the patent even wants to an infringer, who is making products covered by the patent, then that licensed party must mark. Almost no licensed parties what ever agree to mark, which means any troll in the business of licensing/enforcement of a patent is in the same position as a company who does not mark.

    Thus the whole post is as misleading as it could possibly be from any point of view, from his assertion that trolls wait till businesses develop and then assert their patents, to the assumption that trolls can collect damages six years back regardless of whether they have licensees are not simply because they are not selling products.

  6. 15

    The marking statute is unfair, but not in the way suggested by the post. Many big companies, due to the nature of their business and their competition, must cross license their patents. This effectively removes their ability to provide notice by marking their own products because the law requires also that the licensee products be similarly marked, and no cross-licensee will ever agree to mark.

    If there is reform of the marking statute, this inequity should be fixed. It should allow any company making a product to mark their product with patents and obtain benefit of the marking statute regardless that they have licensees that may also be making products but which are unmarked.

  7. 14

    “Trolls exploit this odd situation by waiting for industries or standards to become established, or for sales to accrue, before presenting their now-inflated licensing demands. ”

    I say, bull.

    We have such a thing as laches and if this actually happened in a particular case I am fairly certain the defense would be asserted.

  8. 13

    Here’s a hint Malcolm: your reply of “That’s nice” does not dismiss the point under discussion.

    You seem to think that you can simply say “That’s nice” and move on without understanding why the point was under discussion or what that point under discussion means.

    Maybe (just maybe) if you were not in such a hurry to climb up on your soapbox you would realize why so much of what you shovel from that soapbox is simply wrong, or why you are taken to task for being so wrong so often. Yes, you might need to care (just a little) about facts and about law for that to sink in.

    1. 13.1

      “You seem to think that you can simply say “That’s nice” and move on without understanding why the point was under discussion or what that point under discussion means.”

      Guess again evil MM! ANON IS IN CONTROL! HE WILL NOT LET YOU MOVE ON WITHOUT UNDERSTANDING WHY THE POINT WAS UNDER DISCUSSION OR WHAT THAT POINT UNDER DISCUSSION MEANS!

      Lulz anon.

      1. 13.1.1

        Lulz right back at you 6 – this is not in any sense an issue of control.

        All I did was point out and make explicit what is. This has nothing to do with control, nothing to do with what I will or will not allow.

        You are somehow oddly fixating on your own control fetish, and projecting that control fetish outwards, all the while deluding yourself as to what reality merely is.

        You may wish to discuss this with your doctor (in caps or not – whichever mode you may feel).

        1. 13.1.1.1

          “You seem to think that you can simply say “That’s nice” and move on without understanding why the point was under discussion or what that point under discussion means.”

          “this is not in any sense an issue of control. All I did was point out and make explicit what is.”

          What “is” is that MM has the ability to move on without understanding why the point was under discussion or what that point under discussion means.

          The only reason he might not be able to do so is because someone, ahem, is controlling him from doing otherwise.

          1. 13.1.1.1.1

            The only reason

            Only? Hmm, 6 – it seems that you want to control what is and what is not acceptable.

            You are doing that projecting thing again, my friend.

            1. 13.1.1.1.1.1

              “Only?”

              Yes only.

              ” Hmm, 6 – it seems that you want to control what is and what is not acceptable.”

              How’s that re re?

            2. 13.1.1.1.1.2

              LOL – you cannot understand your control issue with wanting to control “Only”….?

              Add lack of understanding to that list of issues to discuss with your doctor if you don’t mind.

            3. 13.1.1.1.1.3

              “LOL – you cannot understand your control issue with wanting to control “Only”….?”

              I don’t want to “control” “only” ya socially retarded psycho. If you have some other reason then you may of course feel free to put it forward. As yet nobody, including you, has.

            4. 13.1.1.1.1.4

              The laugh is on you 6 – you do not even understand that which you want to control.

              It appears that you have been projecting these symptoms all along.

  9. 12

    one is simply not required to ‘practice.’

    That’s nice. It doesn’t mean that those who don’t practice can’t be treated differently by “the law” than those who do. In fact, they already are treated differently in certain circumstances.

    Of course, you knew that already, didn’t you Mr. “Higher Ethical Standard”?

    1. 12.1

      Of course I already knew that – there is no class distinction in patent law for the substantive rights themselves. You might be trying to conflate the issue of a an equitable remedy, but even IANAE would tell you not to confuse rights and remedies.

  10. 11

    This is another situation in which people think patent law is “special” when it is not. As a matter of public policy, we view “ignorance” as a defense again violating someone else’s property rights with a wary eye. With few exceptions, Ignorantia juris non excusat.

    It is amazing that nobody has addressed this issue in current patent reform efforts directed to curbing the patent troll problem.
    Because it isn’t anti-troll — it is anti-patent.

    The marking statute should protect innocent infringers and it doesn’t.
    There is no such thing as “innocent” infringers. You either infringe or you don’t infringe. There are, however, “willful” infringers — and that can get quite expensive.

    1. 11.1

      Proposal: The marking statute should protect innocent infringers and it doesn’t.

      Response: There is no such thing as “innocent” infringers.

      Sure there are. The law just doesn’t recognize them in the way that it should.

      Get ready for some changes, folks.

      More to come.

      1. 11.1.1

        Sure there are. The law just doesn’t recognize them in the way that it should.

        Should? Because Malcolm the RQ/HD has so decreed.

    2. 11.2

      Because it isn’t anti-troll — it is anti-patent.

      Bingo. It bears notice who exactly coined the term and why exactly they coined the term (hint: it was not for the benefit of the public).

  11. 10

    Dennis –

    Doesn’t the Federal Register and the Publication of a Patent work to serve notice on the poor ignorant, unaware, working out of their garage Industry Standards Body?

    Doesn’t the poor ignorant, unaware, working out of their garage Industry Standards body have internet access? Can’t the Industry Standards Body request a right to use clearance?

    The marking statue is bizarre for another reason. It assumes that the infringer was aware of the marked item. Why is that a fair assumption?

    1. 10.1

      Presumably the idea is that the infringer would be aware of the marked item because they would have been copying the invention in order to infringe.

      An independent inventor would be a bit out of luck with the presumption of notice. However, when inventing and launching a product a check to see if there is a preexisting patent or competitive product already on the marketplace would probably not have been considered unduly burdensome.

      1. 10.1.1

        James,

        Your statement of “Presumably the idea is that the infringer would be aware of the marked item because they would have been copying the invention in order to infringe.” is simply incorrect, as has been stated several times now, infringement does not require knowledge – or intentional copying.

  12. 9

    How does this author connect the “notice” given by marking a patentee’s product to deterring infringement which is the purpose of marking? If I sell a properly marked widget only in the Illinois market, the infringer in New Jersey will not know of it.

    1. 9.1

      If I sell a properly marked widget only in the Illinois market, the infringer in New Jersey will not know of it.

      That’s why it’s called constructive notice. It’s a legal fiction that if the product is marked, everybody knows about the patent. Yes, legal fictions often produce silly results.

      There are other problems with the concept of marking-as-notice. For example, you’re only really giving notice of infringement by the specific product you’re selling. Unless somebody is looking to slavishly copy that exact product from off the shelf, they have no reason to look up the patent and appreciate its full scope.

      And, of course, the entire concept of having to give notice is not very consistent with strict liability, unless you’re using it as a basis for treble damages.

      Besides, people who want to deter infringement by marking, and believe that’s a thing it is possible to do, can put numbers on their product regardless of the state of the law.

  13. 8

    This guy wants freedom to infringe. He wants the patentee to place the infringer on notice but the infringer in a “far away” location can immediately file a DJ action upon such “notice,” which is how he wants to protect his “increased GDP” by infringement. The patentee also increases the GDP by suing his Plantronics. His only problem is with the transfer of that GDP to the patentee from Plantronics. Patent law suits neither increase nor decrease GDP. They only effect a redistribution of wealth from the thieves to the owners of property.

    As an aside, why is Patently-O permitting such drivel and blather on this web site?

    1. 8.1

      why is Patently-O permitting such drivel and blather on this web site

      There are other patent blogs to read which offer nothing but patent fluffing propaganda, endlessly, and where the patent owner squelches all dissenting opinions with insults and/or banning.

      You might enjoy those more. Try IP Watchdog, for example.

      1. 8.1.1

        Nice misrepresentation Malcolm.

        You have been informed several times now on the banning process at that other website.

        I can only take it as you are being purposefully deceptive by continuing to portray the banning process as something that it is not.

        1. 8.1.2.1

          It has been made more than clear to Malcolm what the conditions for being banished at IPWatchdog are.

          And yet he continues his naked obsession with denigrating the owner of that website, purposefully mischaracterizing the intentions of someone that does not even post here. It shows signs of malicious intent and/or reckless disregard for Malcolm to continue his attacks in this manner.

          It would be delicious irony for Gene Quinn to bring a defamation suit against Malcolm and force Prof. Crouch to reveal that particular data – after all, does not data want to be freeee! ?

    2. 8.2

      “The patentee also increases the GDP by suing his Plantronics.”

      LOL WUT?

      Let’s say that is so. If it is the case that suing companies for patent infringement increases GDP then man, we should be trying to encourage more people to sue companies for patent infringement.

      “the infringer in a “far away” location can immediately file a DJ action upon such “notice,” which is how he wants to protect his “increased GDP” by infringement.”

      If you dislike them having that option then you should simply state that the option mentioned should be taken off the table.

    3. 8.3

      Anonymous, another reason the post is drivel is that the poster does not seem to understand the law, and piles on misleading statement after misleading statement in order to galvanize.

      This is nothing but demagoguery.

  14. 7

    Patent owners are encouraged to assert their rights via a notice letter to protect “innocent infringes,” but then vilified as “abusive” if these letters are sent to numerous companies, especially those companies in the back pockets of congressman doting patent reform. This type of argument obfuscates the issue and puts patent owners in the typical no win situation.

  15. 6

    The absence of marking [or actual notice prior to suit] at best only prevents collection of back-damages for infringements up to six years prior to suit. So the question is how much would a change in the law to preclude recovery of back-damages prior to actual notice in ALL cases really impact the successful PAE business model? Presumably most PAE suits are against [accused] present infringers? Especially since once suit is filed, the defendants are no longer innocent of the prior patent and from then on risk enhanced [up to trebled] damages for continued willful infringement unless they have an objectively reasonable non-infringement or invalidity defense.

    But by far the most bizarre development in the limitations of the present marking statute was provided by a panel of the Fed. Cir. in Devices for Medicine v. Boehl. By finding a critical distinction between cases in which only method claims are asserted to have been infringed and cases where a patentee alleges infringement of both apparatus and method claims of the same patent, this decision creates a strange situation in which long-after-the-fact manipulation of which claims of the patent are picked to sue on will control whether the product covered by the patent needed to have been marked (or not) years earlier!

    1. 6.1

      As the author points out, it would certainly make a difference in cases involving expired or near-expiring patents. Without any (significant) damages from present or future infringement, the inability to go back six years would basically eliminate the purpose of those suits.

      I have not seen any empirical studies on the issue, but since many PAEs use patents purchased from other companies (often in bankruptcy), I would not be surprised if the average PAE-asserted patent is older than the average practicing entity-asserted patent. What percentage of them have actually expired or are nearly expired at the time the suit is filed would also be interesting to know.

      But even in the case of a patent “in its prime” (e.g. one that has been infringed for six years but still has many years left in its term), the elimination of six years of infringement would have a substantial effect on the value of the suit. This is especially true in cases that don’t involve entrenched standards or otherwise difficult-to-design-around technologies. In such cases there will be minimal damages from future infringement, and so the back damages are all the patentee has to go after.

      1. 6.1.1

        “since many PAEs use patents purchased from other companies (often in bankruptcy)”

        This is key. Contrary to the post, many PAE may have a marking problem because the predecessor-in-interest, which did have actual products and was a practicing entity, was not marking. Or am I missing something?

        The real problem is litigation costs and nuisance suits where the plaintiff is asking for $50K, $100K, and so on. Marking and the merits don’t matter in these cases. Even if the patent is expired and there was no marking, so damages are really $0, you either pay the fee or pay many times that in attorney fees. Not sure what the solution is though. If damages truly are $50K and there is infringement, a patentee should be able to bring suit. But there needs to be some separate mechanism for these suits where you don’t have to go through million dollar discovery, expensive claim construction briefing and so on (and defendants probably should just give up on invalidity in these cases unless there are multi-defendants to justify the cost).

        1. 6.1.1.1

          The better key would be to understand the difference between whatever it is you think you are discussing and the law.

      2. 6.1.2

        Good points. You are probably correct that many PAE acquired and asserted patents are much closer to their expiration dates than patents in suit between competitors.
        [However, if no one in the chain of patent ownership [or any licensee] ever made or sold any actual product covered by the patent’s apparatus claims, or, only method claims are sued on, the present marking statute, as interpreted by the Fed. Cir., will not preclude claims for up to six years of of pre-suit infringement. ]

    2. 6.2

      “Presumably most PAE suits are against [accused] present infringers?”

      Yeah but the infringement they’re on the hook for is considerably less and they have the opportunity to change their behavior to avoid infringement going forward. As noted in the article.

      “this decision creates a strange situation in which long-after-the-fact manipulation of which claims of the patent are picked to sue on will control whether the product covered by the patent needed to have been marked (or not) years earlier!”

      That is a strange situation.

  16. 5

    Funny too, I don’t remember hearing from you when the AIA rolled through and eviscerated the the stick that came along with marking.

    1. 5.1

      That is the separate issue of the fine for FALSE marking, not the issue here of the [limited scope] denial of back damages recoveries for NOT marking. The Fed. Cir. switch to a fine per product generated a large number of qui tam suits (hoping for a 50% recovery of large fines) (which the AIA did put a real damper on). But there were very few actual such suit recoveries. Because both the prior and present marking statutes require proof that the false making was “for the purpose of deceiving the public.” Under the AIA it additionally requires proof of actual injury from the false marking.

  17. 4

    If it is not possible to mark, then actual notice should be required

    It’s called a published patent.

    Check it out.

    1. 4.1

      I trust that anyone reading various such comments without citations on this blog is taking it as legal advice rather than mere personal wishes for what someone thinks the law ought to be. E.g., the case law is very clear that the kind of actual notice [“notified”] which the subject statute (35 USC 287) requires to recover back damages when a requisite product marking was not provided is NOT merely the publication of a patent.

      1. 4.1.1

        is taking it as legal advice

        I certainly hope not – I am not your lawyer, this is not legal advice (else wise there are far more serious legal ethical issues abounding, eh?)

        1. 4.1.1.1

          We can certainly agree on that. However, this is a public service pro bono blog on patent law, in which most of the comments hopefully ought to be somewhat educational, not misleading inventors and others reading them* as to what the law actually is.

          *I also have serious doubts about how many serious readers these blog comments still have, in view of their frequent extensive misuse for mere exchanges of purely ad hominum insults between commentators.

          1. 4.1.1.1.1

            It is a bully pulpit pure and simple Paul.

            Please do not pretend to be shocked that a battle of perception that rages in the public does not, has not, or even should not be reflected here.

            Your absence of noting some of the most egregious commenting is noted. When you remain silent on those much more egregious attacks on the patent system, your comments as to the state of the blog lose more than just a little ‘punch.’

          2. 4.1.1.1.2

            “I also have serious doubts about how many serious readers these blog comments still have, in view of their frequent extensive misuse for mere exchanges of purely ad hominum insults between commentators.”

            You’d be surprised how many people read the comments and lurk.

      2. 4.1.2

        You are so concerned that someone might mistake “personal wishes” for legal advice, but then you fail criticize the mindlessness of the article when it states (hilariously) that “the marking statute should protect innocent infringers and it doesn’t” (of course it does – by giving the poor dear “innocents” notice not to knock off the product) and that “marking should benefit those who practice the patent” (which of course it does, by warning away poor dear innocents from knocking off the patentee’s product).

        I’ll agree that people ought not to take anything on this blog as legal advice with so many propagandists with agendas constantly posting sanctimonious and hypocritical cr@p.

      3. 4.1.3

        Paul, with all due respect, one is entitled to damages for past infringement without prior notice unless one is selling a product, or his licensee is selling a product, covered by the patent. That my friend is the law.

  18. 3

    There’s a forthcoming student Note (by me) in the W&M Business Law Review that argues for exactly this (focusing specifically on software patents being asserted by trolls, though I suggest general applicability).

    Mark Rawls, Fixing Notice Failure: How to Tame the Trolls and Restore Balance to the Patent System, 5 W&M Bus. L. Rev. 567 (2014).

  19. 2

    The notion of “innocent” infringers is more than a bit misleading. There are no such defenses in patent law.

    1. 2.1

      The notion of being an “innocent” infringer itself isn’t misleading. It may not be a defense, but you can still be an “innocent” infringer in the English-language sense. For example, everyone who owns a Samsung phone might be a patent infringer. I’d probably call them innocent though.

      Also, there is in copyright law. See 17 U.S.C. 504(c)(2). Well, it’s not a defense, but can limit damages. Should there be something akin in patent law? I guess because there are no statutory damages in the patent act, it wouldn’t really make sense.

        1. 2.1.1.1

          You do realize this is law we are discussing, right?

          Pretty sure we’re discussing policy and how changes in the law might better effect that policy.

          But go ahead and pretend otherwise. After all, it’s your blog! Oh wait – no, it’s not. You just troll here because you’re threatened by any changes to the status quo which favors your grifting, bottom-feeding habits.

          1. 2.1.1.1.1

            Did you actually read the post by François deVilliers? He’s clearly talking about policy as was I (as MM correctly pointed out). Not sure you even read my comment, as I agreed with you that innocent infringement isn’t a defense in the legal sense. That doesn’t mean that individuals such as Mr. deVilliers can’t suggest changing the law through Congress though.

          2. 2.1.1.1.2

            Not only did I read the post, I have provided several on-point legal criticisms of the post.

            Or do you think that calling it “policy” means that we should just shut off our thinking?

            The suggestion is a FAIL when it cannot bother to account for why the current law is as it is.

            You do realize that a “use” requirement is stillborn under US patent law, given our law of 101 and the fact that improvement patents are granted to those who may have no right to use the underlying invention, right?

            Let me know if your note captured the full legal implications, or even the most basic ones.

          3. 2.1.1.1.3

            anon,

            In response to 2.1.1.1.1.2, I’m not actually sure if there’s anything to respond to. I agree “use” isn’t and shouldn’t be a requirement.

            I also don’t think NPEs have a marking advantage for all the reasons raised by Ned (and maybe you).

            I don’t understand your last sentence, and so am not responding.

            But I think from a policy perspective, some infringers are innocent (in the English sense). And given the broad scope of patent rights and strict liability (compare with “access” requirement in copyright law), I think it would make sense to have some sort of a tiered damages scheme. Zero is probably not correct. But it makes sense to me that greater damages should be available when there is marking or actual notice, and the still greater when there is willful infringement. That seems reasonable. But all in all, this is not a big concern. Much more important issues in patent law for us to be spending our time on.

          4. 2.1.1.1.4

            have some sort of a tiered damages scheme. Zero is probably not correct

            They already do.

            I suggest you understand that law that you want to comment on, so you don’t come across as some mewling t00l.

        2. 2.1.1.2

          Perhaps a quote from the author’s cite to Nike, Inc. v. Wal-Mart Stores, Inc. (Fed Cir 1998). might be considered on-topic?

          “The marking statute serves three related purposes: 1) helping to avoid innocent infringement, see Wine Ry. Appliance Co. v. Enterprise Ry. Equip. Co., 297 U.S. 387, 395, 56 S.Ct. 528, 530, 80 L.Ed. 736 (1936); Motorola, Inc. v. United States, 729 F.2d 765, 772, 221 USPQ 297, 302 (Fed.Cir.1984); ….”

          It appears the 1998 Federal Circuit considered the topic of “innocent infringement” to be appropriate in legal writings.

          Regards,
          An Infrequent Commenter

  20. 1

    Immediate sense of Kool-aid: “This has led to the odd situation in which a company that is vigorously engaged in the rough and tumble of commerce with its patented product, benefiting consumers, creating jobs and increasing GDP, is in a less favorable position than an entity that does nothing.

    This ignores the foundation of patent law that a patent is a negative right and one is simply not required to ‘practice.’

    Better chum please.

    1. 1.1

      Not really. Under your views, it might suggest that we completely get rid of the marking statute.

      1. 1.1.1

        suggest that we completely get rid of the marking statute.

        In case you hadn’t noticed, that is already been effectively done.

Comments are closed.