Now in Legal Rebels:
Posted Jun 16, 2010 12:57 pm CDT
San Diego patent lawyer Matthew Pequignot had asserted a right to trillions of dollars in damages after realizing that patent markings on the lid to his daily cup of coffee had actually expired several years before.
He lost his quest in a ruling last Thursday by the U.S. Court of Appeals for the Federal Circuit, the National Law Journal reports. The court found that Pequignot failed to prove the defendant company intended to deceive the public with its false mark, a requirement under the recovery statute.
Pequignot had sued Solo Cup under a under a qui tam provision in the patent law that allows citizen whistle-blowers to sue companies that deceive the public with false patent numbers and to split the damages recovered with the federal government, Corporate Counsel reported last month.
Pequignot and other plaintiffs were buoyed by a ruling in a separate suit last year calling for up to $500 in fines for each offending product sold, rather than $500 in total. Since then, more than 200 false marking lawsuits have been filed under under the qui tam provision, according to the Corporate Counsel story.
Billions of Solo’s cup lids were made with improper marks. The Federal Circuit noted in a footnote to its Solo Cup opinion (PDF) that Pequignot’s quest for $500 in damages for each improperly marked product would produce an award to the United States of $5.4 trillion, an amount sufficient to pay 42 percent of the country’s national debt.
Last Thursday’s ruling is expected to stem the tide of lawsuits, the NLJ says. The Federal Circuit upheld dismissal of the suit and a lower court finding that Solo didn’t have the intent to deceive consumers, according to the NLJ and Bloomberg News. The company had said it didn’t immediately replace the molds with the patent marks because each replacement costs about $500,000.
Solo made its decision to keep using the molds to reduce costs and business disruption, the appeals court said, and acted after consulting with lawyers.
Kelsey Nix, an intellectual property and litigation partner at Willkie Farr & Gallagher, told the NLJ that the Solo Cup decision “will re-inject a sense of reason into the process.”