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Federal Circuit Clarifies False Marking Deceptive Intent

June 12, 2010

Recently, the Federal Circuit, in Pequignot v. Solo Cup Company, clarified the high standard of deceptive intent involved in 35 U.S.C. §292, the statute prohibiting false patent marking.

The Federal Circuit first addressed the deceptive intent issue in Clontech Laboratories v. Invitrogen Corp.. The court held that: “Intent to deceive is a state of mind arising when a party acts with sufficient knowledge that what it is saying is not so and consequently that the recipient of its saying will be misled into thinking that the statement is true.” Further, the court, quoting another case, stated that this test establishes an “inference that there was a fraudulent intent.”

In Solo Cup, the Federal Circuit has clarified the impact of this test by establishing that the Clontech test creates a rebuttable presumption of deceptive intent. This rebuttable presumption can be overcome, for example, by proof of good faith. In Solo Cup this good faith was established by Solo’s reliance on advice of counsel that their actions were not prohibited. In accepting Solo Cup’s defense, the court clearly established (re-established?) the particularly high standard of proving deceptive intent.

The Federal Circuit’s clarification of §292 will hopefully quell the fears of opponents to §292. As I have previously noted, preventing false marking is an essential counter-balance to the advantages created by patent marking. Hopefully this case will demonstrate that §292 and its qui tam cause of action are not so dangerous after all, and that the statute should remain in force as-is.

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