Patent Infringement: The Cease and Desist Letter

Patent infringement is similar to trespassing on private real estate. A deed for real property determines the real property’s boundary and what constitutes a trespass. In a similar vein, Patent claims define the intellectual property boundary of the Patent and what establishes an infringement.

Patent infringement is defined in United States Code Section (U.S.C.) 271. In part, Section 271 reads:

“Infringement of Patent (a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.”

Patent Infringement Damages

Patent infringement damages are defined in U.S.C. 284 which, in part, reads:

“Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court. When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed. Increased damages under this paragraph shall not apply to provisional rights under section 154(d).”

What Happened to Our Business was Surprising

We received a letter from the legal department of Company ABC demanding payment of damages for our alleged sales of Company ABC’s patented gadget. Prior to receiving the letter, our business was not aware that Company ABC’s gadget was patented. What can we do?

How To Defend Against Allegations of Patent Infringement

• Contact an experienced patent attorney.
• Determine if the patent is in full force and effect and is owned either directly or indirectly by Company ABC. The USPTO Assignment Database gives notice to the world of ownership rights in assigned Patents.
• Determine if the gadget was identified by the patent number as set forth in 35 U.S.C. 287(a). In part, 35 U.S.C. 287(a) reads, “In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice.”
• Calculate the expiration date of the Patent. The USPTO website includes a Patent Term Calculator to assist in determining if a Patent remains in full force and effect. Practicing the claimed subject matter of an expired Patent is not an infringement.
• If there is no settlement agreement with company ABC, make no payments to Company ABC.
• In this scenario, receiving a letter from the legal department of Company ABC instead of a law firm is unusual.

Business Patent Law, PLLC provides intellectual property and business counsel for businesses and companies. If you need legal assistance procuring and managing your intellectual property assets, please contact us.

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