Federal Circuit Reaffirms That Section 287 Requires Actual Notice of the Infringement

In a precedential decision handed down last week, Lubby Holdings LLC v. Chung, a panel of the Federal Circuit reaffirmed the long-standing interpretation the the patent marking statute, 35 U.S.C. § 287(a), precludes an award of damages for infringing conduct pre-dating the defendant's receipt of either actual notice of the infringement or, though marking, constructive notice.  (There are more nuances to these rules than I will repeat here, but if you're interested, see, e.g., here and chapter 2.9 of my casebook on Patent Remedies.) From the majority opinion (authored by Judge Dyk, joined by Judge Wallach):

 

Lubby established only that Mr. Chung was actually notified of infringement of the patent as required by § 287 as of the filing of the lawsuit on January 26, 2018. See 35 U.S.C. § 287(a) (“Filing of an action for infringement shall constitute . . . notice.”).

In response, Lubby argues that Mr. Chung had actual notice prior to the filing of the lawsuit because Mr. Chung admitted in his answer “that he had notice of the issuance of the ’284 patent.” Appellee’s Br. 57. Mr. Chung’s admission that he had notice that the ’284 patent issued does not equate to actual notice under § 287. “For purposes of section 287(a), notice must be of ‘the infringement,’ not merely notice of the patent’s existence or ownership.” Amsted Indus. Inc. v. Buckeye Steel Castings Co., 24 F.3d 178, 187 (Fed. Cir. 1994).

Lubby also argues that, because Mr. Chung was on notice of the ’284 patent and of his own infringing activity before the filing of the lawsuit, it is entitled to damages from earlier sales. As we have long explained, “the actual notice requirement of § 287(a) is satisfied when the recipient is informed of the identity of the patent and the activity that is believed to be an infringement, accompanied by a proposal to abate the infringement, whether by license or otherwise.” SRI Int’l, Inc. v. Advanced Tech. Labs., Inc., 127 F.3d 1462, 1470 (Fed. Cir. 1997). “It is irrelevant [under § 287] . . . whether the defendant knew of the patent or knew of his own infringement. The correct approach to determining notice under [§] 287 must focus on the action of the patentee, not the knowledge or understanding of the infringer.” Amsted, 24 F.3d at 187 (p.8).

 

Judge Newman dissents on the damages issue, stating that the majority "ignores Chung’s admitted knowledge, for these parties had been collaborators in connection with this invention. Rado testified that when the collaboration ended he told Chung not to infringe, and Chung acknowledged this warning."

 

While on this topic, I should an interesting patent marking issue that hasn't attracted a great deal of attention yet, namely whether § 287(a) applies when the patent owner licenses (or grants a covenant not to sue) in settlement of litigation.  For recent discussion, see Chris Marchese, Nicole Williams & Sara Serag, Does Section 287(a) Apply to Agreements That Do Not Contain a Patent License?, Patent Damages Blog, and (when it is available) my former student Bernard Cryan's article  Not All Licensees Are the Same: § 287 Should Not Require No-Admission Licensees to Mark, 101 J. Pat. & Trademark Off. Soc'y __ (forthcoming 2021).