In 2017 and 2020, the Federal Circuit issued two Arctic Cat decisions (available here and here) that are important for any patent litigator (and patent owner) to understand. Both decisions deal with patent marking and thus patent damages. By law, a patent holder is entitled to, at most, six years’ worth of pre-suit damages—i.e., damages can at most begin to accrue six years before the plaintiff files its lawsuit. See 35 U.S.C. § 286 (“[N]o recovery shall be had for any infringement committed more than six years prior to the filing of the complaint or counterclaim for infringement in the action.”).
An important limitation on damages is the patent-marking statute, 35 U.S.C. § 287. Section 287(a) provides:
Patentees, and persons making, offering for sale, or selling within the United States any patented article for or under them, or importing any patented article into the United States, may give notice to the public that the same is patented, either by fixing thereon the word “patent” or the abbreviation “pat.”, together with the number of the patent, or by fixing thereon the word “patent” or the abbreviation “pat.” together with an 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, or when, from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.
(emphasis added).
In short, a patent holder who practices its patent may mark its embodying product. If the patented product is not marked (by either the patent holder or any licensee of the patent holder), damages do not begin to accrue until the infringer was notified by the patent holder of the infringement.
The Artic Cat decisions discussed many of § 287(a)’s requirements, including that:
- The patentee bears the burden of pleading and proving he complied with § 287(a)’s marking requirement. Section 287 is a limitation on damages, not an affirmative defense.
- Compliance with § 287(a) is a question of fact.
- If a patentee who makes, sells, offers for sale, or imports his patented articles has not “given notice of his right” by marking his articles pursuant to the marking statute, he is not entitled to damages before the date of the defendant’s actual notice of the patent and its alleged infringement.
- A patentee’s licensees must also comply with § 287, and courts will consider whether the patentee made reasonable efforts to ensure compliance with the marking requirements.
- If a licensee sold products covered by the patent-at-issue and did not mark, the patentee has failed to satisfy the marking requirements.
- The burden of proving compliance with marking is and at all times remains on the patentee. Where the defendant identifies unmarked products of the patentee’s licensee, it is the patentee’s burden to establish that the products did not fall within the patent claims.
- The alleged infringer who challenges the patentee’s compliance with § 287 bears an initial burden of production to articulate the products it believes are unmarked “patented articles” subject to § 287. The Federal Circuit has found that “this is a low bar.” “The alleged infringer need only put the patentee on notice that he or his authorized licensees sold specific unmarked products which the alleged infringer believes practice the patent. The alleged infringer’s burden is a burden of production, not one of persuasion or proof.” “Once the alleged infringer meets its burden of production, however, the patentee bears the burden to prove the products identified do not practice the patented invention.”
- “The alleged infringer need not produce claim charts to meet its initial burden of identifying products. It is the patentee who bears the burden of proving that it satisfied the marking requirements and thus the patentee who would have to prove that the unmarked products identified by the infringer do not fall within the patent claims.”
- Section 287 “continues to limit damages after a patentee or licensee ceases sales of unmarked products.” “[O]nce a patentee begins making or selling a patented article, the notice requirement attaches, and the obligation imposed by § 287 is discharged only by providing actual or constructive notice.”
- Willful infringement—e.g., where an infringer knew of the patent and of its infringement—does not establish actual notice under § 287. Section 287 “is directed to the conduct of the patentee. The marking statute imposes notice obligations on the patentee, and only the patentee is capable of discharging those obligations.”
- The notice provisions of § 287 do not apply to patents directed to processes or methods. Nor do they apply when a patentee never makes or sells a patented article. “Thus, a patentee who never makes or sells a patented article may recover damages even absent notice to an alleged infringer.”
- If “a patentee makes or sells a patented article and fails to mark in accordance with § 287, the patentee cannot collect damages until it either begins providing notice or sues the alleged infringer—the ultimate form of notice—and then only for the period after notification or suit has occurred. Thus, a patentee who begins selling unmarked products can cure noncompliance with the notice requirement—and thus begin recovering damages—by beginning to mark its products in accordance with the statute.”
- “Actual notice requires the affirmative communication of a specific charge of infringement by a specific accused product or device.”