Will The Federal Circuit’s Decision in Pequignot v. Solo Cup Co. Impact The Number of New False Marking Cases?

In an earlier post we noted that 69% of the known false marking cases allege one or more expired patents as the basis for a false marking claim (“expired patent cases”). Interesting, but those numbers represent only a snapshot in time. Since the past few years have seen several new decisions addressing false marking issues, we thought it would be even more interesting to look at the number of false marking filings over a timeline that corresponds with the recent false marking decisions. We divided our timeline using the following milestones:

March 24, 2008

The court denies a motion to dismiss in Pequignot v. Solo Cup Co., 540 F. Supp. 2d 649 (E.D. Va. 2008), concluding that marking with expired patent numbers may constitute false marking and the use of permissive language (“may be covered”) in the marking does not create a safe harbor.

December 28, 2009

The Federal Circuit issues an opinion in Forest Group Inc. v. Bon Tool Co., 590 F.3d 1295 (Fed. Cir. 2009), holding that the $500 penalty for falsely marking a product under 35 U.S.C. § 292 applies to each article so marked.

As shown in the chart below, the twenty months following the Solo Cup decision saw a modest increase in the number of false marking cases. Yet even though Solo Cup opened the door for expired patent cases, it prompted only 13 new filings of that type. In fact, during that same period of time, false marking cases based on allegations that the marked product did not fall within the scope of the patent (“patent scope cases”) outnumbered expired patent cases 19 to 13.

All of that changed after the Forest Group decision. In the 3 months following that decision, over 100 new expired patent cases were filed. That represents an increase from approximately one new expired patent case per month to more than 30 per month. And expired patent cases now outnumber patent scope cases nearly 5 to 1.

In our prior post on this topic, we observed: “Should the Federal Circuit adopt this position [that establishing intent to deceive is difficult in expired patent cases], more than two-thirds of the pending false marking cases would be affected.” That is undoubtedly true. But this new data suggests, perhaps, that the affect may not be as significant as we once imagined. If the driving force behind the recent surge in new false marking cases is damages, creating an additional hurdle on liability may do little to dissuade qui tam plaintiffs.