Update on the America Invents Act: Virtual Marking
On September 16, 2011, President Obama signed the America Invents Act (“the Act”) into law. Included in the overhaul of Title 35 are significant changes to patent marking. Patent marking is the familiar practice of printing “patent pending” or the applicable patent numbers on the product covered by the patent, and is an important step in providing notice to competitors. The Act changes much of the existing patent marking scheme. Virtual marking, in which a company prints a free-to-access web address on the product instead of patent numbers, is now allowed. The Act also ends private class actions related to false marking. Notwithstanding, the changes in the Act raise almost as many questions about patent marking as they resolve. The following information should be considered before implementing a virtual marking strategy with your organization.
Under the new virtual marking provisions, a patent holder can mark covered products with “patent” or “pat.” followed by a free-to-access web address rather than a list of individual patent numbers. For companies that include patent information in product molds, virtual marking provides an avenue of giving notice that does not require expensive retooling associated with adding new patent numbers as they arise or removing those that have expired. Virtual marking may also be attractive where space constraints or aesthetic considerations have limited the number of patents that can be displayed on a product or packaging.
A well-designed and well-maintained website will be an essential component of any virtual marking strategy. Patent publications and patents often change in status while a single product may remain static. Establishing efficient website “updating protocols” will be critical to ensure proper virtual marking. Updating protocols include maintaining accurate updates to the status (i.e. expired, abandoned, etc.) of patents and printed publications. Additionally, updating protocols should include maintaining an accurate list of patents and printed publications that are associated with specific products. Continuous maintenance of updating protocols will provide an organization with the ability to put competitors on notice that the products being sold are associated with particular patents and published applications.
Moreover, the Act does not require products to include published applications within the virtual marking scheme. Thus, deciding whether to include printed publications as part of your virtual marking strategy should also be considered. Timely marking of printed publications allows the applicant to obtain certain rights against infringers that extend back to the date of publication.
On the other hand, because a list of patents is provided on the website in conjunction with a particular product, timely marking also provides competitors an easier opportunity to begin working on “design around” options.
Updating a virtual marking site presents several options for adequately giving notice to the public. For example, the use of expiration dates provides a low cost option in updating a product’s virtual marks. A patent’s expiration date may change due to abandonment or findings of invalidity. If a change occurs, a patentee should keep continuous records of the patent’s status to provide the most forthright notice to those viewing the virtual mark.
Federal Circuit precedent requires patent marking to be “substantially consistent and continuous.” In view of this precedent, the components of an effective virtual mark remain uncertain. A physical mark never crashes, never goes offline and cannot be hacked. Not so with a virtual marking site. A robust virtual marking strategy must contemplate the unpredictable nature of the internet and consider alternative mechanisms of providing “consistent and continuous” virtual marking should a web site crash. Many details must be considered and researched in light of the unique qualities of your business and patent portfolio. Examples include planning for backups in the event of a power outage or hacker attack, and determining how your company will document successive updates to the website. The Federal Circuit or Congress may clarify some of these issues related to virtual marking, but companies would be wise to exercise an abundance of caution now to avoid unnecessary litigation in the future.
Finally, the ability to obtain useful information about those who visit your website could be a significant advantage in maintaining a virtual marking strategy. Although the Act requires that companies provide public access to the website “without charge,”
some have suggested that this portion of the statute allows companies to require user registration before displaying the applicable patents. A company could easily capture and record visitors’ IP addresses, and trace them back to the company where they originated. Advance warning of which competitors are viewing your products could potentially help direct efforts to detect infringement.
For many companies, the advantages and ease of virtual marking will outweigh the uncertainties. Other companies may wish to wait for others to blaze the trail of virtual marking. For those that continue to practice physical marking, the Act reduces the risk of false marking claims by limiting who can pursue those claims. Before the Act, anyone could bring a false marking claim as a class action, with fines of up to $500 per offense. The Federal Circuit held that “per offense” meant per product, and manufacturing runs of only a few thousand products with incorrect information created liabilities of millions of dollars. Now, under the Act, only the United States government or competitors that can prove competitive injury may bring false marking claims. This change is retroactive. Indeed, many false marking suits that existed at the time of the change have been dismissed. Obviously it is still important to keep your marking current, but the end of the ever-looming threat of a multi-million-dollar false marking class action should help patent holders sleep better at night.
For more information on the subject of this article, contact the authors of this article, or the Larkin Hoffman attorney who customarily handles your matters. Larkin Hoffman Daly & Lindgren Ltd. has proudly served the legal and business counseling needs of clients since 1958. The firm includes over 70 attorneys serving clients’ legal needs throughout the state, the country and around the globe. As a full-service law firm, it provides counsel and legal guidance in more than 20 areas of law to clients ranging from individuals to emerging companies and Fortune 500 corporations.
While the information provided in this publication is believed to be accurate, it is general in nature and should not be construed as legal advice. You should consult an attorney for advice regarding your individual situation.
Under 35 U.S.C. § 154(d), “a patent shall include the [provisional] right to obtain a reasonable royalty from any person who, during the period beginning on the date of publication of the application …and ending on the date the patent is issued - (A) (i) makes, uses, offers for sale, or sells in the United States the invention as claimed in the published patent application…and (B) had actual notice of the published patent application.”
35 U.S.C. § 287(a) — “address of a posting on the Internet, accessible to the public without charge for accessing the address, that associates the patented article with the number of the patent . . . .”