Some individuals and small businesses see the lawsuits as a new and exciting business opportunity. Most large, established companies see them as a nightmare.
Hundreds of companies throughout the U.S. have been dragged into lawsuits for marking their products with inaccurate or expired patent numbers, a violation of the false patent marking statute. They face fines of up to $500 for each falsely marked item--so a defendant that makes mass-produced items may be at risk of fines worth billions, or even trillions, of dollars. Those bringing the suits get to keep half the fines, while the rest go to the federal government.
The false patent marking statute is on shaky constitutional ground, according to many experts. The statute may violate part of Article II of the Constitution, which requires that the executive branch "take care that the laws be faithfully executed."
Three other district courts have ruled on this constitutional issue, however, and they all found the false patent marking statute satisfies the "take care" clause. But they didn't agree on why.
In Their Court
In Zojo Solutions, Inc. v. The Stanley Works, a federal district court in Illinois last year used different reasoning to reject a "take care" challenge to the statute. The court noted that in the Federal Circuit's seminal 2009 ruling on the false marking statute, Forest Group, Inc. v. Bon Tool Co., the appellate court didn't mention any constitutional problem. "[T]hat court's failure to speak of any potential problem of unconstitutionality could be viewed as confirming the validity of the statute," the Illinois district court stated, adding that this constitutional issue would better determined by the Federal Circuit.