False Marking

False marking (as distinguished from false marketing) occurs when a product is falsely labeled as falling within the scope of an enforceable patent.  False marking likely occurs in three ways: (1) there is no patent, just a patent application; (2) the listed patent has lapsed or expired; or (3) the product falls outside the scope of the patent claims.

The statutory penalty for false marking is $500 per INSTANCE.  In theory that means a company selling 10,000 falsely marked units could be liable for a $5,000,000 penalty!  When the statute was first passed, law firms saw this as a lucrative opportunity, and started filing lawsuits left and right.  Their behavior was so egregious that Congress quickly changed the law to limit the penalty to “recovery of damages adequate to compensate for the injury”.   In normal English, this just means that a plaintiff must prove “actual damages”, something that is very difficult to do with respect to false marking.  For example, let’s say a competitor falsely marked its chairs with the number of an expired patent, and Bob avoids selling similar chairs because he is concerned about infringing the listed patent.  Damages would be extremely difficult to prove because Bob could have readily gone to www.PublicPAIR to discover that the patent was no longer in force.