Mark Your Products/Packaging or Lose Your Past Damages

October 3, 2011

Plaintiff filed a patent infringement action against several defendants. After the district court's Markman decision, the parties filed cross-motions for summary judgment regarding patent infringement and the scope of damages. After denying the parties' respective cross-motions for summary judgment, the district court addressed the defense motion for a limitation on damages due to plaintiff's failure to properly mark his device.
The defendant argued that even if it did infringe the patent-in-suit, plaintiff would not be entitled to any damages for any infringement between the issuance of the patent and the filing of the complaint because plaintiff failed to mark his product with the patent number.

As the district court noted, "[a] patentee may only recover damages for patent infringement that occurs after the patentee provides notice to an accused infringer under 35 U.S.C. ยง 287(a)." Notice can be satisfied either by constructive notice or actual notice. Constructive notice is satisfied if the patentee marks the product consistently and continuously with the word patent or "pat." and the patent number or, if the product cannot be marked, the product's packaging can be marked. Actual notice is satisfied by an affirmative communication from the patentee regarding a specific charge of infringement by a specific accused product or device.

The parties did not dispute that plaintiff began selling a commercial embodiment of the patent while the patent application was pending for the patent and sold a number of devices after the patent issued. It also was not disputed that the plaintiff did not physically mark his product with the patent number and, prior to filing the lawsuit, did notify the defendant of the alleged infringement. Defendant contended that it was possible for the plaintiff to mark his product because defendant marked its allegedly infringing product and because plaintiff had marked its product "patent pending" while the patent application was before the PTO. Plaintiff contended it was not commercially feasible to mark its products once the patent issued because it would have had to tool up dyes and then stamp the remaining devices in inventory with the patent number. Plaintiff's argument essentially was that Section 287(a) should not apply because it had no products to mark as there were only a small number of products in inventory and all of the products had already been manufactured at the time the patent issued. Plaintiff argued that the Federal Circuit allows full recovery if the failure to mark is "de minimis" and here it was de minimis because plaintiff had sold over 11,000 devices before the patent issued and sold only 62 devices after the patent issued.

The district court agreed with the defendant. The district court found it significant that the plaintiff had both manufactured and sold the product, a commercial embodiment of the patent. Although it may have been difficult to mark the remaining inventory, it was not impossible to do so. The district court also noted that the de minimis exception did not apply because the products that had been sold before the patent issued had not been marked. Thus, none of the products had been marked by the plaintiff. "That plaintiff sold nearly all of his devices prior to the issuance of the patent does not excuse plaintiff's failure to mark his remaining devices after issuance. Plaintiff is not entitled [to] the de minimis doctrine based on the facts in this case."
Accordingly, the summary judgment motion to limit plaintiff's damages was granted.

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The district court's decision illustrates the importance of the marking requirement to the recovery of damages. Indeed, even the failure to mark a small number of products, can be fatal to the ability to recover damages prior to filing the lawsuit.

Calluori v. One World Technologies, Inc., Case No. CV07-2035 CAS (VBKx) (C.D. Cal. Sept. 16, 2011)

The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.