Considerations with United States patent marking
Disclaimer: The information provided in this factsheet is meant as an educational resource only and should not be construed as legal advice.
- Intellectual Property (IP) marking is a visual notice to the public that you hold IP rights to a creative work, product, service, design, or brand. The advantages of IP marking are threefold:
- Serves to notify the public and competitors that you own (or are in the process of securing) IP rights associated with a product or work, which can prevent, or at least discourage, infringement.
- In the event that infringement occurs, marking often makes it easier to claim damages and in some cases, the infringer will be deemed to have been aware of your rights by virtue of proper IP marking (see #6)
- Use of “patent pending” or identification of issued patents on your product indicates that it is innovative which can make it more attractive for consumers to buy or investors to support
- Traditionally, IP rights relating to patents and industrial designs were indicated directly on the product or packaging. This was done by either affixing the words “patent pending” or “Patent” followed by the patent number.
- IP owners now have the option of displaying patent marking information on their website. This practice, known as ‘virtual marking,’ allows the patent owner to mark the product with Patent or Pat. and the web address. In order to be considered “constructive notice” (see #6), the website must be easily accessible and include all relevant information such as patent number, year, owner, and what products are covered by the patent. Although not mandatory, it is a good idea to specify when the list was last updated.
- In addition to issued patents, published applications should be included and updated at issuance. The list should be based on each product/service.
- It is important to remove any expired or abandoned patents from the list, as there are very hefty penalties for false marking. Associating patents to the wrong products can also be considered false marking.
- Patent marking serves as what is known in the United States (US) as “constructive notice”. In the event of litigation, and in the absence of proper marking, an infringer is typically only liable to compensate for damages after being made aware of the infringement by the patent owner (proper notice). Even in the event of accidental infringement, the infringer is deemed to have had notice of the patent by virtue of patent marking.
- In the event of litigation, constructive notice means that the patent owner does not have to prove when the infringer was formally advised of the infringement, enhancing the potential recovery of damages. The patent owner could recover up to 6 years of prior damages, regardless of when the infringer was notified by the patent owner.
- Canada employs a similar policy in the Industrial Design Act for industrial designs but does not have an official provision for utility patents. In a case of alleged infringement for utility patents, the patent owner is entitled to damages for past infringement regardless of whether there was marking, however, it is still good practice to employ marking in Canada for the other benefits that have been mentioned.
Example: Rembrandt Wireless brought Samsung Electronics to court in the US for infringement of two of its Bluetooth patents. The jury awarded Rembrandt $15.7 million in damages; however, Samsung appealed the ruling on the grounds that Rembrandt had licensed one of the patents to a third party (Zhone Technologies) but did not require the licensee to mark its products with applicable patent numbers. The Federal Circuit agreed with Samsung and reduced the amount rewarded to include only damages suffered after proper notice was given as there was no patent marking to serve as constructive notice. This reduced the amount Samsung had to pay to Rembrandt by over $4 million.
Key considerations for Canadian companies:
- Although there are no requirements for patent marking in Canada for utility patents, it is important to implement a process to mark all relevant patents for each product/service either virtually or on the product, and to keep those markings up to date, especially if you wish to expand into the US for reasons outlined above.
- For Non-Practicing Entities (NPEs – a company who secures patent rights but does not practice the patented invention), they carry the burden of showing compliance to marking statutes when requesting prior damages. Since they have no products to mark, even virtually, the NPE must take reasonable steps to ensure its licensees mark the products with the patents they license.
- According to Natalie Giroux, President at Stratford Intellectual Property, “Patent marking is usually a consideration during due-diligence and may impact company valuation”.
Additional information:
- For information about IP protection in the US, please see the Canadian Intellectual Property Office’s publication on Doing business abroad: Protecting your IP in the United States
- For more material relating to the export of goods to the US, please see the Doing Business in the United States page
- For more information on going global with your IP, visit Canada.ca/export-ip
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