Ruling on Motions for JMOL Regarding Marking Requirement, Sealant Sys. Int'l Inc. v. TEK Global S.R.L., Case No. 5:11-cv-00774-PSG (Magistrate Judge Grewal)
What do you do if you're a patentee trying to establish that you're not subject to the patent marking requirement because your sister company actually sold and marketed the patented product instead of you? Magistrate Judge Grewal, acknowledging that there is no settled answer to this question, recently found one solution. He placed the burden of proving that the patentee failed to properly mark its own good squarely on the defendant.
Magistrate Judge Grewal's ruling was part of an omnibus Order addressing several post-trial motions following a jury trial in which the underlying patent for a tire repair kit was found both valid and infringed. The plaintiff and defendant each had filed cross-motions for judgment as a matter of law claiming that the other party bore the burden of proving whether the plaintiff and its predecessor had complied with the marking statute, 35 U.S.C. §287. Under this statute, the patentee and its successors must either mark their own patented products and/or the products' packaging, or provide actual notice of infringement, in order to recover damages for any period prior to when the complaint for infringement is filed. What is not clear from the statute is who bears the burden of satisfying the marking requirement if the patentee claims it never actually sold a product that implemented the patent.
In this case, the patentee, Accessories Marketing, Inc. ("AMI"), moved for a judgment as a matter of law that the defendants, TEK Global S.R.L. and TEK Corp. (collectively, "TEK"), did not produce sufficient evidence such that a reasonable jury could credit TEK's marking defense. TEK countered that AMI failed to satisfy its burden of showing the marking statute had been complied with. Thus, each party argued that the other bore, and did not satisfy, the burden of proving compliance with the statute.
However, both parties agreed there was no clear guidance from the Federal Circuit on this issue, and case law from other districts in similar contexts was split. In the end, AMI took the day by pointing the Court to a recent ruling from Judge Alsup elsewhere in the District, in Oracle Am., Inc. v. Google Inc., Case No. 3:10-cv-03561-WHA, 2011 WL 5576228 (N.D. Cal. Nov. 15, 2011). In that case, Judge Alsup held that for the statute to apply, Google was required to show that Oracle had failed to mark patented articles offered for sale before the date Google was put on notice of the underlying patent. In other words, it was Google that had to produce evidence establishing acts by Oracle sufficient to trigger the damages limitation of the marking statute.
Magistrate Judge Grewal agreed with Judge Alsup's logic. He concluded that placing the burden of proof on the defendant was the better option because "[a]bsent guidance from the [defendant] as to which specific products are alleged to have been sold in contravention of the marking requirement, a patentee like AMI is left to guess exactly what it must prove up to establish compliance with the marking statute." In other words, Magistrate Judge Grewal decided that the infringer must put the patentee on notice of the specific products it claims were sold without proper marking before the question of whether those products were properly marked is implicated. Similarly, Magistrate Judge Grewal held the infringer also bears the burden of establishing that a purported offer constitutes a sale pursuant to the statute, before the marking statute is implicated based on such an offer. Thus, Magistrate Judge Grewal held that TEK had an initial burden of showing that a commercial product subject to the marking requirement was on sale in the United States. Because TEK failed to satisfy that burden, Magistrate Judge Grewal left his own mark on the dispute, concluding that AMI was entitled to judgment as a matter of law.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
