What do bow ties, children’s shoes, “Etch A Sketch,” and toothpaste have in common? Answer: Each company is being sued for using expired patent numbers on their products or in their product materials. Since 2008, over 600 cases have been filed in federal courts against manufacturers, distributors and retailers for misusing patent numbers on products – roughly half of those have been filed since December alleging that the defendants use expired patent numbers in connection with their products. No industry is immune from these lawsuits. High profile defendants include Brooks Brothers, Ohio Art (manufacturers of the famous Etch A Sketch toy), Crest toothpaste and, recently, Vida Shoes International and its U.S. importers, Osh Kosh B’Gosh and Carter’s. In each of these cases, plaintiffs seek judgments in the millions and, in some cases, billions.
The dramatic rise in these lawsuits follows three opinions from the Federal Circuit over the past ten months. In the most recent case, Stauffer v. Brooks Bros., Inc., the Federal Circuit held that an individual, regardless of whether he or she suffered an injury, is free to file a case against any entity using expired patent numbers under the false marking statute, 35 U.S.C. 292. The reason is that 35 U.S.C. 292 is a qui tam provision where the plaintiff steps into the shoes of the United States. Thus, the only injury that must be alleged is an injury to the United States. Indeed, half of the damages awarded go to the United States and the remainder goes to the plaintiff and, of course, plaintiff’s lawyers.
Prior to these Federal Circuit opinions, false markings cases under 35 U.S.C. 292 had been generally limited to use of patent numbers where no part of the product had ever been the subject of a patent or patent application. The Federal Circuit’s opinions paved the way for an influx in cases. Recent plaintiffs appear to be shell corporations operated by groups of intellectual property attorneys or, in at least one case, by an individual intellectual property attorney. Media reports describe potential plaintiffs as literally combing through the aisles of supermarkets and department stores in the hunt for products with expired patent numbers. These plaintiffs may also be scouring the Internet for potential defendants or scrolling through publicly available patent records looking for any product with an expired patent. There is no product that appears to be off-limits.