Amsted Industries Inc. v. Buckeye Steel Castings Co.
24 F.3d 178 (Fed. Cir. 1994)
Amsted obtained a patent on a
doo-dad related to the structure of rail cars.
Amsted sent out a notice to
all their competitors describing their patent, and generally warning them
not to infringe on it.
Buckeye made a similar
doo-dad. When Amsted found out what Buckeye was doing, they sent a
specific notification that they were infringing on Amsted's patent. When
Buckeye refused to cease and desist, Amsted sued for infringement.
The Trial Court found for
Amsted. Both sides appealed the damages.
The Trial Court limited
damages because Amsted had not properly marked their product.
To mark a product means to put a statement on it
saying that it is patented.
Under 35 U.S.C. §287, recovery of damages is limited to the
period after which the infringer is notified of the
infringement. That can be either when the product is marked, or they receive a cease-and-desist letter from
the patent holder.
Amsted argued that they
never sold the complete patented doo-dad, they only sold components to
rail car manufacturers who assembled the complete doo-dad. Therefore
they had no duty to mark under §287.
Amsted argued that if they
had marked the individual
components (which were not themselves patented), it would have violated 35
U.S.C. §292 which prohibits the marking of an unpatented article.
Buckeye argued that they
were not notified until they
received the second letter. However, the Court found that the first
letter was enough to give notice.
The Appellate Court affirmed
in part and reversed in part.
The Appellate Court found
that Amsted should have marked the
components with something like "for use under US patent
number..." or "licensed under US patent number...." That
would have satisfied §287 and §292.
They could have also
written into the contract with the licensees that the licensees had to mark the assembled product.
The Court found that
Amsted's first letter did not constitute notice within the meaning of §287
because it just talked about Amsted's patent and generally advised
companies to not infringe. It wasn't until Amsted sent the second
letter, which specifically charged Buckeye with infringement and
specified which Buckeye product was infringing, did they meet the notification requirement of §287.
Note that one problem in
sending a cease-and-desist letter is that the accused infringer can then
go to whatever court they want to and ask for a declaratory judgment that
they are not infringing. That gives the accused infringer the advantage
of choosing the venue and the timing.