PUBPAT WARNS CONGRESS OF HARM FROM PROPOSED CHANGE IN FALSE MARKING LAW: Nonprofit Notes Change Could Allow Deceit, Eliminate a Source of Government IncomeNEW YORK -- March 19, 2010 -- After a surprising proposal by the Senate Judiciary Committee to substantially eviscerate the current law against false patent marking that has been in place for over one hundred and fifty years, the Public Patent Foundation (PUBPAT) wrote leaders in both houses of Congress today to urge them to preserve the existing law. In the letters sent today to Senators Patrick Leahy (D-VT) and Jeff Sessions (R-AL) of the Senate Judiciary Committee and to Representatives John Conyers, Jr. (D-MI) and Lamar Smith (R-TX) of the House Judiciary Committee, PUBPAT’s Executive Director Daniel Ravicher warned that the proposed change to the anti-false patent marking statute “would eliminate an important method of protecting the public from false and deceitful statements.”
The false patent marking law imposes a fine on companies that label unpatented products as patented “for the purpose of deceiving the public.” Currently, the law allows any citizen to sue false markers on behalf of the federal government and any fine awarded by the court is split between the citizen who brought the case and the government. Such "qui tam" suits, which have been part of our country since its founding and originally derived from custom in England, provide an incentive for citizens to spend time and money to bring such cases so that the government does not have to do so itself. While not burdening government officials, the suits nonetheless also supply the federal government with income. The Senate's proposed amendment to the law would eliminate such citizen suits, allowing only competitors to sue for “competitive injury” from the deceptive labeling. In some markets, there are no competitors, and thus no one would be able to pursue a company for deceitfully marking its products as patented.
"Falsely marking an unpatented item as patented harms the public by misleading consumers, deterring competition, and depriving legitimate patentees of the marketplace distinction they deserve," wrote Ravicher. "I respectfully urge [you] to preserve the qui tam provision of the false patent marking statute because it operates to prevent harmful, deceptive acts, without cost to the government, while also containing adequate protections for defendants."
The Senate has held no hearings or debates on the effects of the current false marking law or the proposed change.
The House Judiciary Committee has not yet commented specifically on the change to the false marking law; however, in a statement issued March 4, 2010, four of its members discussed the larger patent reform bill in which the proposed change is found. While expressing hope for patent reform, the statement noted that “a number of changes are essential” to the legislation.
Read PUBPAT's March 19, 2010, letter to the Senate regarding false patent marking.
Read PUBPAT's March 19, 2010, Letter to the House regarding false patent marking.
More information about PUBPAT's activities related to patent reform can be found at PUBPAT > PUBPAT in Congress.