The Best Part of Waking Up: a Lawsuit in Your Cup

Wealth of Ideas Newsletter, July 2009

Who but a patent attorney would look for a lawsuit under the lid of his morning cup of coffee? That’s exactly what Washington, DC-area attorney Matthew Pequignot did – and he found that the patents marked on his Solo cup lid had expired almost 20 years earlier.

Although the expired patent numbers were probably the result of old cup-lid molds that were never updated rather than an actual intent to deceive, Pequignot took legal action – on behalf of the government!

Qui Tam Statutes: Suing for the King

The patent law code, 35 U.S.C., in section § 292, addresses the issue of false marking: for example, marking products with patent numbers that don’t cover that product or marking with patents that are expired. That law also states that “Any person may sue for the penalty, in which event one-half shall go to the person suing and the other to the use of the United States.”

A law that allows an individual to sue another party on behalf of the government is known as a “qui tam” law. Qui tam is an abbreviation for the Latin "qui tam pro domino rege quam pro sic ipso in hoc parte sequitur," meaning, “who as well for the king as for himself sues in this matter.”

Pequignot used this law as the basis for suing Solo Cup in 2007 for marking the cup lid in question with two expired patents, U.S. Patent No. RE28,797, entitled "Lid," and U.S. Patent No. 4,589,569, entitled "Lid for Drinking Cup," and for including the phrase "This product may be covered by one or more U.S. or foreign pending or issued patents.”

Damages of up to $500 per violation – which could be defined as every single article so marked – are possible; and, as mentioned above, the person who brings suit under this qui tam statute gets to keep half of it.

Archaic, but Constitutional

Lest this sound like an almost cartoonish, clichéd example of a lawyer going after easy money, Pequignot wants the public to know that false marking is not uncommon and can be done intentionally to dissuade competitors from manufacturing similar products, for example. While this may be true, one suspects that the attorney – if successful – won’t turn down his portion of the damages award as a matter of principle.

Though he still has some legal hurdles to clear, Pequignot was so emboldened by his ability to file the Solo suit, that he filed another suit against Gillette (a Procter & Gamble company) for false marking on his razor.

Both Solo and Gillette are fighting back. Solo Cup tried to argue that it was unconstitutional for a private citizen to have the right to sue on behalf of the government, but U.S. District Court Judge Leonie Brinkema ruled in March 2009 that the law is constitutional and Pequignot can proceed with his case. And Gillette’s attorneys argued that the case should be dismissed because Pequignot could not prove that the razor manufacturer acted with intent to deceive.

More Qui Tam False Marking Suits on the Way?

Will we see a tidal wave of these “false marking” qui tam lawsuits? A few more have been filed in the wake of Pequignot’s Solo Cup suit. However, Raymond E. Stauffer, a New York patent attorney who attempted to sue Brooks Brothers over the expired patents on his bow tie, was unsuccessful – the judge ruled that Stauffer failed to prove that the government had suffered harm from the improperly marked neckwear.

And even the judge who allowed Pequignot’s Solo lawsuit to proceed seems to have done so begrudgingly. Regarding 35 U.S.C. § 292, the law that allows individuals to sue companies like Solo and Gillette on the government’s behalf without having to prove that they personally suffered any injury from the false marking, Judge Brinkema wrote in her ruling that "It is likely an accident of history that (the law) survives as one of the few remaining qui tam statutes in American law."

It remains to be seen how these cases will play out in courts. In the meantime, if you find a product marked with an expired patent number (hint: a number that starts with the digit “4”), drop us a line. In true Robin Hood spirit, we pledge to give our half to the poor.