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Figuring the Fine for False Patent Marking: How Should a Court Determine the Amount?

05/02/2011

By Sid Leach and Sean J. O'Hara

After decades out of the spotlight, there is renewed focus on the false patent marking statute, 35 U.S.C. § 292, which provides for a fine of “not more than $500 for every such offense” and permits “any person” to sue for that fine and keep half of the fine, while the remainder goes to the federal government. In 2009, the Federal Circuit reversed a century of precedent and held that the fine must be imposed on a per-article basis, not on a per-“decision to falsely mark” basis. Prior to that decision, courts limited the amount of the fine by construing the term “offense” to apply to a decision to falsely mark, rather than to every sale of a falsely marked article. When patent markings applied to a large number of mass-produced goods are found to be false, the potential amount of the fine may be extraordinarily large if calculated at $500 per article. The statute does not provide guidance on how a court should determine the amount of the fine. This article compares other statutory schemes in which courts are authorized to impose fines or damages without express guidance in the statute, and examines how the amounts are determined in those types of cases.
 

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