Hello all,
Once upon a time, in the halcyon days when inventors actually made things—you know, physical objects you could drop on your foot—life was refreshingly simple. You’d stamp “patent pending” on your widget, ship it off into the world, and sleep soundly knowing you’d covered all your legal bases. Those were the days when patents were as tangible as the products they protected, and the biggest marking challenge was finding enough space on a horseshoe.
Then the digital revolution arrived. Software emerged, followed by the internet, the cloud, AI, and a parade of intangible innovations that have all the physicality of a politician’s campaign promise. Suddenly, patents began covering things you couldn’t engrave if you tried—unless you’re particularly gifted at etching code into thin air.
The problem? Patent law, much like that one friend who still uses a flip phone, hasn’t quite caught up with reality. The legal framework governing patent marking remains stubbornly rooted in the past and many inventors discover too late that their cavalier approach to marking requirements has cost them more than a missed opportunity—it’s cost them cold, hard cash and legal leverage.
What follows below is a tour through the current state of patent marking in the US and internationally, complete with survival tips for navigating the most common pitfalls that trap the unwary.
Speaking of unwary, I’ve recently applauded our US senators for pushing legislation that would strengthen patent rights—a rare moment of bipartisan agreement that patents might actually deserve protection. (See our previous coverage for details on this minor miracle.)
Today, however, I must report that these same political masterminds have introduced a draft bill that threatens to undermine their previous good work. The new proposal would make patent enforcement significantly more expensive through what can only be described as a “creativity tax”—because apparently, the current system wasn’t quite discouraging enough for inventors seeking to defend their rights in court. It’s legislative whiplash at its finest: one hand giveth, the other hand taketh away, and both hands apparently belong to the same body politic.
Finally, I’ll cover the key IP market developments from the past three weeks, with particular attention to the recent verdicts that seem to have the lifespan of mayflies—here today, overturned tomorrow. It’s become something of a judicial tradition, really, this business of rendering decisions that age about as well as milk in the sun.
As usual, as I focus on the macro picture in this newsletter, I want to remind everyone that we track everything that is going on in this world and for those who need their regular dose of news, once again you can follow me on LinkedIn where I post almost daily about some of the most newsworthy events. If you want to catch up on what grabbed my attention these recent weeks, you can access all my posts directly here.
Happy reading!
Louis
__________________
Tangible IP News
We are pleased to report that we recently assisted one of our buy side clients acquiring strategic patents in the imaging area. This is the second time this year that we have assisted this client with their immediate needs. Details must remain confidential.
If your organization is looking to acquire patents, either because of an urgent need or to meet a longer term freedom to operate goal, feel free to contact us at info@tangibleip.biz . We can source relevant assets and approach patent holders anonymously on your behalf, all the way to closing a transaction.
All of our patents for sale are listed here. Similarly, if you’d like to be added on our distribution list in the future so that you are the first to receive new opportunities, please email us at info@tangibleip.biz.
__________________
On Your Markings, Get Set, Go!
When Arctic Cat lost millions in damages because their licensee forgot to stamp patent numbers on snowmobiles, it wasn’t just embarrassing—it was a masterclass in how America’s patent marking obsession can bankrupt the unprepared. While Company X spends $2M annually on marking compliance programs, their German competitor focuses that same budget on R&D. Guess which approach builds stronger patents?
This tale perfectly illustrates how patent laws worldwide may share common ancestry, but patent marking requirements reveal where different jurisdictions decided to take wildly divergent paths—like distant cousins at a family reunion who can’t agree on anything except that they all root for the same football team.
The United States stands magnificently alone in many things these days, including how it treats patent marking as a high-stakes game where the penalty for losing isn’t just embarrassment, but potentially millions in damages. Meanwhile, the rest of the world watches this American obsession with bemused tolerance.
Under 35 U.S.C. § 287(a), American patent law operates on a simple principle: mark your products with patent numbers, or watch your damages disappear faster than free donuts at a law firm meeting. The statute essentially tells patent owners, “No marking, no money”—except for damages accruing after you’ve actually told the infringer to stop their shenanigans.
This creates what lawyers euphemistically call “strong incentives for compliance.” The 2011 America Invents Act mercifully introduced virtual marking, allowing companies to slap “Patent” plus a website URL on their products instead of trying to fit seventeen patent numbers onto a smartphone case with a magnifying glass.
The Licensing Trap That Ate Arctic Cat
The real fun begins with licensing. In Arctic Cat v. Bombardier, the Federal Circuit clarified the impact of failure to mark products on the recovery of pre-suit damages under 35 U.S.C. § 287(a). The court held that if the patent holder fails to mark its own products, it cannot recover damages for infringement that occurred before the filing of the lawsuit, unless the alleged infringer had actual notice of the infringement. Although the case did not directly address a scenario where the license agreement explicitly exempts the licensee from marking obligations, it underscores the importance of complying with marking requirements to secure the ability to claim past damages.
The court’s logic? Patent owners must “police” their licensees’ marking compliance, turning every licensor into an unpaid compliance officer. Because nothing says “efficient business relationship” like requiring patent owners to become hall monitors for their own licensees.
Recent decisions demand marking “substantially all” products, with courts playing a numbers game where 95% compliance passes but 77% fails. Because nothing says “efficient legal system” like forcing federal judges to become statisticians with calculators.
Method patents get a free pass because, as the Federal Circuit reasoned in 1998 in Hanson v. Alpine Valley Ski Area, you can’t exactly stamp patent numbers onto a series of steps. This makes about as much sense as trying to trademark a dance move—which, incidentally, people have also attempted…
Europeans have taken a refreshingly different approach: they simply don’t care about patent marking. The European Patent Convention contains exactly zero marking requirements, treating the entire concept with indifference.
Germany epitomizes this philosophy with characteristic efficiency. German law assumes commercial actors know about relevant patents through some form of business telepathy, eliminating the need for physical reminders. Damages calculate from the infringement date regardless of marking, because Germans apparently believe that running a business means staying informed about relevant patents.
The United Kingdom offers a mild exception through its “innocence defense,” but this defense succeeds about as often as their cricket team wins in Australia. The UK recognizes virtual marking, though with typical British understatement, its practical impact remains “limited.”
France and the Netherlands follow Germany’s lead, treating patent marking like an optional garnish rather than the main course. The new Unified Patent Court, despite handling over 800 cases since 2023, hasn’t yet introduced marking requirements—confirming that Europeans prefer focusing on actual infringement rather than administrative theatrics.
The fundamental difference? European courts provide three damage calculation methods—lost profits, reasonable royalty, or infringer’s profits—available from day one of infringement. No marking homework required.
Asian jurisdictions have been enhancing patent enforcement while keeping marking requirements reasonable. China’s recent reforms increased penalties, with statutory damages up to 5 million RMB and punitive damages up to five times actual damages for willful infringement, but marking remains optional. China takes false marking seriously, with fines up to 2.5 million RMB for fake patent numbers. Japan has become a patent enforcement leader without requiring marking, awarding significant damages in cases like Sangenic v. Aprica. Korea, with optional marking, improved enforcement dramatically with 2024 amendments raising punitive damages to five times actual damages and favorable conditions for foreign patent holders.
Canada has explicitly rejected the US marking approach with the diplomatic firmness typically reserved for declining American beer. The Supreme Court of Canada confirmed that patent marking should not affect damage calculations, treating the entire US constructive notice doctrine like a misguided American export.
Canadian law provides full damages from the infringement date without marking requirements, subject only to a six-year limitation period. The landmark Nova Chemicals case awarded $645 million in damages while completely ignoring marking considerations—proving that Canadians can be devastatingly effective in patent enforcement without the administrative theatrics.
Recent Canadian developments focus on practical improvements like electronic filing systems rather than marking requirements, suggesting that Canada’s approach to patent enforcement resembles its approach to healthcare: broadly available and refreshingly free of American complications.
__________________
What This Means for You
For Patent Prosecutors:
- Draft US licenses with explicit licensee marking duties post-Arctic Cat
- Consider virtual marking strategies for complex product lines
- Advise clients on jurisdiction-specific enforcement strategies
For In-House Counsel:
- Budget enough to meet US marking compliance programs
- Develop licensee monitoring systems to avoid Arctic Cat disasters
- Consider foreign filing strategies that bypass US marking complications
__________________
Discretion Denied: The USPTO’s New Game of “Too Little, Too Late”
Or: How the PTAB Transformed from “Patent Death Squad” to Procedural Obstacle Course
Remember when the Patent Trial and Appeal Board was nicknamed the “patent death squad”? Well, grab your defibrillators, because Acting USPTO Director Coke Morgan Stewart just performed CPR on patent rights with her groundbreaking June 6 decision in iRhythm v. Welch Allyn—and the patient is not only alive, but apparently holding grudges about those vintage salt shaker collections we mentioned earlier.
Just when you thought PTAB practice couldn’t get more unpredictable, Stewart reminded us that, yes, it absolutely can. The agency handed down a blunt message to IPR petitioners everywhere: if you knew about the patent years ago and waited until litigation to challenge it, don’t expect a warm welcome.
This new approach—emerging from a March 2025 rule overhaul—splits IPR reviews in two. First, a select panel (with the Director in the room) decides whether to even entertain your petition based on discretionary factors. Only if you survive that trial by procedural fire does the petition move on to a separate panel to consider its technical merits.
In other words, you’re now playing two games of chess simultaneously—one on the board, the other in the mind of the referee.
The Case That Changed Everything
Here’s where it gets deliciously ironic: iRhythm had what looked like a slam-dunk case by traditional standards. The PTAB would finish reviewing the patents months before any district court trial, there was minimal court investment, and a stay was likely. Under the old playbook, this screamed “institute the IPR.”
But there was one tiny problem: iRhythm had disclosed the asserted patents in an IDS back in 2013, then waited until after litigation to file for IPR. That delay proved fatal.
Stewart invoked the new “settled expectations” doctrine—essentially ruling that some patents get to retire with dignity, thank you very much. Her reasoning? iRhythm’s “awareness of Patent Owner’s applications and failure to seek early review of the patents favors denial and outweighs the above-discussed considerations.”
Translation: If you see a patent and don’t challenge it immediately, you might be out of luck later. It’s like patent law’s version of “use it or lose it,” except backwards.
Patent owners are practically doing victory laps. Josh Malone cheered: “If we can begin to trust that the USPTO isn’t going to take back our patents, U.S. innovation can flourish again.” As one Finnegan attorney put it, this new “settled expectations” factor gives patent owners “another arrow in the quiver.” Or maybe a tranquilizer dart.
Meanwhile, patent defendants are having existential crises. The decision essentially created temporal immunity for older patents—regardless of how questionable their validity might be. As Crowell & Moring dryly noted, “settled expectations… appears to be a new, potentially significant hurdle.”
This isn’t just a policy tweak; it’s a philosophical earthquake that’s turned the PTAB from a validity free-for-all into something resembling actual property law. Even strong invalidity arguments can now be brushed aside in favor of protecting the PTO’s limited bandwidth and the patent owner’s peace of mind.
What this means for patent owners:
- Document all market activities and licensing discussions
- Memorize the new discretionary criteria like bedtime prayers
- Check if the IPR challenger cited your patents in their own filings
- Strike while the bifurcation is hot—expect 60-80% fewer IPR institutions
The PTAB has always been a procedural rollercoaster. But with this new structure and a Director willing to deny on fairness alone, the ride just got twistier. The age of “better late than never” in patent challenges appears to be officially over.
__________________
Taxing Justice: How the Tillis Bill Puts Small Inventors on the Chopping Block
Senator Thom Tillis (R-NC) and Rep. Kevin Hern (R-OK) just introduced the Tackling Predatory Litigation Funding Act—a title that sounds noble but masks a troubling reality. Consider Sarah Chen, a biotech researcher who spent her life savings developing a breakthrough diagnostic patent, only to face Apple’s $200M legal team in court. Without litigation funding, she’d be armed with a public defender against a corporate army. This bill would tax her lifeline at 40.8% while leaving Apple’s internal legal budget completely untouched.
At its core, the bill slaps a 40.8% excise tax on profits earned by litigation funders in any civil case—but the real target, as Tillis himself made clear, is patent litigation, especially when foreign-backed funders are involved. Fortress Investment, for instance, has drawn ire from big tech for bankrolling suits against Apple and Intel. The Wall Street Journal, in its predictable corporate defense stance, cheered the bill as a way to stop “patent trolls” armed with Abu Dhabi money.
But here’s the problem: this bill doesn’t just hit deep-pocketed financiers—it also guts the only lifeline small inventors have when going up against the Goliaths of Silicon Valley. Patent litigation is eye-wateringly expensive—easily running $3-7 million per case. Without funding, a solo inventor has no chance of enforcing a patent that took years and $50K-150K to obtain. This bill essentially tells them: Good luck—litigate on your own dime, or not at all.
And let’s not pretend this is some neutral, across-the-board tax on all litigation funding. There is no comparable tax on funders of class actions, personal injury claims, or securities fraud cases—where litigation finance is even more prevalent. You can fund mass torts all day long, but the second you help a garage inventor assert their patent, Uncle Sam takes nearly half the upside. If that’s not picking winners, what is?
Recent data shows:
- Patent litigation funding: $2.1B annually, now facing 40.8% tax
- Class action funding: $8.7B annually, tax-free
- Personal injury funding: $15.2B annually, tax-free
Critics from across the IP community have sounded the alarm. Some called the bill “weaponizing the tax code” in favor of Big Tech. Others worry it sets a dangerous precedent: If patent rights can be quietly weakened through tax policy, what’s next? Environmental claims? Civil rights suits?
Patent reform is overdue—but not like this. If there are legitimate concerns about national security risks from foreign-funded lawsuits, let’s increase disclosure requirements (which most funders are perfectly fine with), not blow up the funding ecosystem that gives inventors a fighting chance. If we want to prevent frivolous suits, then tighten pleading standards or fund early validity reviews—not punish every funder who dares invest in enforcement.
The Tillis bill isn’t about fairness. It’s about protecting dominant incumbents from accountability, using the tax code as a blunt weapon. And in the process, it threatens to make the U.S. patent system what it was never meant to be: a right in theory, but unenforceable in practice—unless you’re rich.
__________________
Patent Verdicts Heat Up Courtrooms – and Corporate Balance Sheets
It’s been a blockbuster few weeks in patent litigation, with juries and judges dishing out (or undoing) some eye-popping verdicts that perfectly illustrate why the global patent marking divide matters so much. These cases show the high-stakes nature of patent enforcement—and why administrative theatrics like marking requirements can make or break billion-dollar outcomes.
The Big Wins
Samsung was slapped with a $112 million verdict after a Texas jury found it infringed three Maxell patents tied to mobile and networking tech. The decision adds yet another nine-figure tab to Samsung’s already lengthy litigation résumé—and notably, marking compliance wasn’t even an issue since these were method patents. In Germany or Japan, this case would have proceeded identically, but with faster resolution.
The Dramatic Reversals
Meanwhile, Intel scored a rare win in its long-running war with VLSI, as a jury ruled that a single license with Fortress Investment Group (which controls both VLSI and Finjan) could nullify $3 billion in prior verdicts. That’s right—three billion dollars, potentially erased thanks to a corporate ownership loophole that would make those vintage salt shaker collectors proud of their organizational skills.
In another reversal twist, PNC Bank got relief from a $218 million verdict awarded to USAA over mobile check deposit tech. The Federal Circuit ruled that USAA’s asserted patents covered nothing more than abstract ideas, effectively wiping the slate clean for PNC.
These verdicts reveal three critical patterns:
- Volatility is the new normal: Patent damages are increasingly boom-or-bust, with nine-figure awards disappearing overnight
- Corporate structure matters: Intel’s victory shows that licensing strategies can trump technical arguments
- Abstract idea rejections are accelerating: The PNC decision continues the Federal Circuit’s aggressive stance on patent eligibility
It’s a reminder that in patent law, the final word isn’t always the jury’s. Between courtroom fireworks and strategic licensing moves, verdicts are increasingly volatile—sky-high one day, vaporized the next. But unlike our international competitors, American patent holders must navigate these waters while maintaining perfect marking compliance, or risk losing everything to administrative oversight.
As the courts swing between award and annihilation, one thing is clear: the price of patents is still sky-high—but only if they survive both the technical merits and the procedural gauntlet. Choose your enforcement jurisdiction accordingly.