Patent Marking

The patent marking requirement under 35 U.S.C. § 287 provides that when a patent owner makes or sells a product that embodies a patent, the patent owner can give the public constructive notice of the patent by marking the product with the patent number. MARKING IS OPTIONAL BUT CONSEQUENTIAL: marking is not required — no penalty attaches for failing to mark; however, § 287(a) limits damages to the period after actual notice of infringement if the patent owner fails to mark; this is the crucial consequence: if the patent owner has been making and selling a patented product WITHOUT marking it, the patent owner CANNOT recover damages for infringement that occurred before the infringer was actually notified of the patent; CONSTRUCTIVE NOTICE: a properly marked product gives constructive notice to the world of the patent's existence; once a product is marked and the public is put on notice, the patent owner does not need to separately notify potential infringers — the marking itself is notice; once constructive notice is established (through marking), the patent owner can recover damages from any infringer who encounters or should encounter the marked product; ACTUAL NOTICE ALTERNATIVE: if the patent owner does not mark, they can still recover damages from the date they gave the infringer ACTUAL NOTICE — typically by sending a letter identifying the patent and specifically charging the infringer with infringement; Amsted Industries v. Buckeye Steel Castings (Fed. Cir. 1994) established that actual notice must be specific — it must identify the patent AND specifically charge the recipient with infringement.

PHYSICAL MARKING REQUIREMENTS: products must be marked with the word 'Patent' (or the abbreviation 'Pat.') followed by the patent number(s); 'Patent Pending' is used before the patent issues (this is a different concept — not § 287 marking); the marking must appear on the product itself if practicable; if marking on the product is not practicable (small component, liquid, software), the marking may appear on the packaging; VIRTUAL MARKING — AMERICA INVENTS ACT CHANGE: the Leahy-Smith America Invents Act (AIA, 2011) introduced 'virtual marking' under § 287(a); instead of printing every patent number on each product, the patent owner can mark the product with 'Patent' or 'Pat.' followed by a URL to a webpage that: (a) identifies each product associated with the URL; (b) lists the patents that cover each product; virtual marking substantially reduces the cost of updating markings as new patents issue — the URL remains constant even as the patent list at that URL changes; the webpage must be freely accessible — no login, no fee; WHAT MUST BE MARKED: all products that EMBODY the patent must be marked; if a patent is licensed, the licensee must also mark (or the patent owner's right to recover pre-notice damages is still affected by the licensee's failure to mark); COMPLIANCE: maintain a centralized list of patents associated with each product; update the virtual marking page whenever new patents issue or old patents expire; audit licensees' products for proper marking.

The consequences of failure to mark on recoverable damages are severe and well-established: BASIC RULE: if the patent owner (or licensee) failed to properly mark products embodying the patent, the patent owner can only recover damages for infringement after the date the infringer received ACTUAL NOTICE of the patent and specific infringement allegations; DAMAGES PERIOD LOST: suppose a patent issued in 2010 and the patent owner sold marked products from 2010 to 2015; from 2010 to 2015, constructive notice ran; if an infringer began infringement in 2012, damages run from 2012; now suppose the patent owner sold UNMARKED products from 2010 to 2015 and only sent a demand letter in 2015; in that scenario, damages only run from 2015, even though infringement began in 2012; the 3-year period of infringement (2012–2015) is entirely lost; LICENSEE MARKING OBLIGATION: if any licensee makes or sells a product embodying the patent WITHOUT marking, the patent owner's ability to collect pre-notice damages is affected; this is true even if the patent owner itself always marked; Crown Packaging Technology v. Rexam Beverage Can Co. (Fed. Cir. 2010) — patentee's failure to enforce marking on licensees forfeited pre-notice damages; PATENT OWNER'S OBLIGATION: the patent owner must actively police its licensees' marking compliance; license agreements should require marking; patent owners should periodically audit licensee products; EXCEPTIONS: § 287(a) applies only to products that EMBODY the patent; method claims (process patents) cannot be marked (no article of manufacture to mark); for method-only patents, there is no marking obligation and no marking-based damages limitation.

False marking under 35 U.S.C. § 292 is the intentional mismarking of articles as patented when the patent has expired, does not exist, or does not cover the article. PRE-AIA FALSE MARKING: before the AIA (2011), any person could sue a false marker; the fine was $500 PER ARTICLE falsely marked, with the plaintiff receiving half the fine; this created enormous class action exposure — a company with a million products marked with an expired patent faced $250 million in liability per infringer; AIA FALSE MARKING REFORM: the AIA substantially reformed § 292; POST-AIA RULES: (1) only the U.S. Government or a competitor that has SUFFERED COMPETITIVE HARM from the false marking can bring a false marking action; (2) marking a product with an expired patent does NOT constitute false marking as long as the patent was not expired at the time the marking was applied; this substantially reduced false marking exposure; WHAT STILL CONSTITUTES FALSE MARKING: intentionally marking an article with a patent number that never covered that article (no nexus between the product and the patent); intentionally continuing to mark after learning the patent was invalid; marking with a patent number knowing the article does not infringe the claims of that patent; MARKING BEST PRACTICES TO AVOID FALSE MARKING: maintain an accurate marking database; remove patent numbers from marking pages when patents expire; regularly audit products to ensure marking is current; don't mark products with patents that don't actually cover them; audit carefully after patent expiration dates.

Patent licensing creates important marking obligations that must be addressed in license agreements: LICENSEE MARKING OBLIGATION: § 287(a) provides that if the patentee or licensee makes, offers for sale, or sells within the U.S. any article constituting a patented article, the patentee must mark; this means: if a licensee sells products embodying the patent without marking, the patent owner LOSES pre-notice damages for infringement by third parties even if the patent owner itself always marks; LICENSOR'S RISK FROM LICENSEE NON-COMPLIANCE: a patent owner with a broad licensing program who doesn't monitor licensee marking practices is vulnerable; if one licensee's unmarked products are on the market, an infringer can argue that constructive notice was not established; the infringer's actual start date for liability is delayed until actual notice; LICENSE AGREEMENT REQUIREMENTS: all patent license agreements (exclusive and non-exclusive) should: (1) require the licensee to mark all licensed products with the patent number(s) or virtual marking URL; (2) give the licensor the right to audit licensee products for marking compliance; (3) specify remedies for non-compliance (breach, termination, indemnification); EXCLUSIVE LICENSEES AND STANDING TO MARK: an exclusive licensee who is the only entity making patented products must mark or the patent owner cannot collect pre-notice damages from infringers; exclusive licensee marking is particularly important because the licensor may not be making any products at all; SUB-LICENSEES: if the primary licensee can sub-license, sub-licensee marking obligations must also be addressed in the chain of agreements.