What are the Punishments for Patent Law Violations?

Did Your Company Commit an Intellectual Property Violation?

Patent law doesn’t have the same serious or long-lasting effects as criminal law the majority of the time. Patent law is all about ownership of immaterial property, also known as intellectual property or IP.

Rarely should anyone go to jail over infringing on a patent or copyright. Instead, punishments for patent law are either monetary or property-based. If you’re unsure of the risks of violating patent law, the patent law attorneys at Emerson Thomson Bennett can explain.

How Do Patent Law Punishments Work?

Typically, patent law violations are committed by companies and small businesses, but they can be committed between individuals. For this reason, punishments such as jail or prison time are exceedingly rare results of cases we work with. 

One of the reasons punishments like prison are not utilized is that most offenders are entities rather than people. Entities cannot be imprisoned and rarely is everyone who is part of an entity guilty of breaking the law. 

To deter breaking patent law, the punishment must be damaging to a business. This is why our clients and their competitors face these punishments for patent law infringement, rather than other punishments you may be more familiar with.

How Are Patent Applications that Infringe on Other Patents Allowed?

The United States Patent and Trademark Office (USPTO) does not actively check whether a new patent application infringes on existing patents. Instead, its role is to evaluate whether the application meets the criteria for patentability, such as novelty, non-obviousness, and utility. Here’s why patent applications that may infringe on others can still be approved:

1. Patent Examination Scope: The USPTO examiners focus on whether the invention is new and non-obvious compared to prior art (existing patents, publications, or publicly available information). They do not assess whether the invention infringes on another patent, as infringement is a legal issue, not a patentability issue.
2. Infringement is a Legal Matter: Patent infringement is determined in court, not by the USPTO. If a patent holder believes a new patent infringes on their rights, they must file a lawsuit to resolve the issue.
3. Claims Interpretation: Patent claims can be complex and open to interpretation. The USPTO may approve a patent with claims that seem similar to another, but the exact scope of those claims and whether they overlap is often debated in court.
4. Independent Development: It’s possible for two inventors to independently develop similar ideas. The USPTO grants patents to both if they meet the criteria, leaving infringement disputes to be resolved separately.
5. Patent Challenges: After a patent is granted, there are mechanisms like post-grant reviews or inter partes reviews where third parties can challenge the validity of a patent if they believe it overlaps with prior art or existing patents.

In short, the USPTO’s approval of a patent does not guarantee it won’t infringe on another patent. It’s up to patent holders to monitor new patents and take legal action if they believe their rights are being violated.

8 Common Ways You Can Commit a Patent Violation

Patent violations, also known as patent infringements, occur when someone uses or exploits a patented invention without the permission of the patent holder. This can happen through various actions, often due to disregard of patent laws. Here’s a list of common ways patent violations occur, along with explanations:

1. Producing or Selling a Patented Product Without Permission: Manufacturing or selling a product that incorporates an invention protected by a valid patent without the patent owner’s authorization. Patents give the owner special rights to make, sell, or share their invention. Unauthorized use violates these rights.
2. Using a Patented Process Without Authorization: Using a patented method or process, such as a specific manufacturing technique, without obtaining a license. Processes are intellectual property, and using them without permission undermines the patent owner’s control over their innovation.
3. Importing Patented Goods Without Consent: Bringing products into a country where someone has a patent on the design, product, or process is illegal. This is true if you do not get permission from the patent holder. Violating patent rights can lead to serious consequences. Importing patented products from another jurisdiction breaches the patent owner’s rights in that specific region.
4. Selling or Offering to Sell a Patented Item Without a License: Selling or advertising products that use patented technology or designs without permission. Even advertising a patented product for sale without permission infringes upon the owner’s exclusive rights.
5. Reverse Engineering a Patented Product: Disassembling a patented product to recreate and sell a similar item without obtaining legal rights. The act of cloning the patented product, even if reverse-engineered, infringes upon the patent holder’s rights.
6. Minor Changes to a Patented Product or Process: Modifying a patented product or process slightly and claiming it no longer infringes. Minor changes do not avoid patent infringement if the original patent claims still apply to the new product.
7. Induced or Contributory Infringement: Encouraging or enabling others to violate a patent, even if you don’t directly infringe. Assisting in patent infringement is punishable, even if the perpetrator doesn’t directly produce or sell the infringing product.
8. Ignoring Expired Patents Without Checking Patent Updates: Assuming a patent has expired and using the invention without checking for extensions or ongoing protections. Patent laws and renewals vary by jurisdiction, so ignorance of the actual protection status doesn’t absolve responsibility.

Contributory Infringement: How to Know If You Committed Infringement

Contributory infringement is a legal concept in intellectual property law, particularly in patent law, where a party indirectly infringes on a patent by contributing to or enabling another party to directly infringe it. Here’s a breakdown of what it means:

1. Knowledge of Infringement: The accused party must know that their actions or products are contributing to the infringement of a patent.
2. Material Contribution: The accused party provides a component, material, or service that is specifically designed or adapted for use in a patented invention.
3. No Substantial Non-Infringing Use: The component or material provided must not have any substantial non-infringing uses. In other words, its primary purpose is to enable the infringement of the patent.
4. Direct Infringement: There must be an underlying act of direct infringement by another party. Without direct infringement, there can be no contributory infringement.

Punishments For Committing Intellectual Property Violations Against Patents

1. Monetary Damages: Violating patent law can lead to the victim suffering financial losses. It can cause them to lose sales, clients, partners, employees, and more. If the defending party is found guilty of violating another company’s patent and the plaintiff proves that the violation led to their financial loss in some way, the defending party will have to financially cover both those losses and potential losses in the future. In some cases, the court may award treble damages if the infringement is found to be willful.
2. Injunctions: Injunctions stop the defending party from committing actions that will potentially continue their infringement. This means temporarily ceasing the production, sale, use, or offering of the potentially infringing products/services. If the accused is found not guilty of infringement, these injunctions will be lifted.
3. Costs and Attorney’s Fees: Similarly to other types of civil law, if the defending party loses, they can be forced to pay the legal fees of the plaintiff. This is especially possible if the infringement is deemed willful or egregious.
4. Seizure and Destruction of Infringing Products: Courts can order that infringing products be reasonably seized and destroyed from warehouses and store shelves. ‘Reasonably’ is the key word because consumers who already own the infringing product cannot be forced to give it up. 
5. Criminal Penalties: We have established that these are rare, but it’s important to note that there are some examples where this is possible. In cases of deliberate and significant infringement, particularly ones that led to dangerous, defective products, criminal charges can be brought against individuals who are a part of the defending entity.

Contact the Patent Law Attorneys at Emerson Thomson Bennett

Patent law may not feel as dire to you as an individual compared to criminal law, but it has serious financial consequences for your business. Protect your business’s future and avoid as many legal issues as possible. It can’t help your business to be charged with patent infringement.

If someone has infringed on your patent, you need to send a cease and desist letter immediately. If you do not protect your patent, you can lose it. 

For this situation, the patent law attorneys at Emerson Thomson Bennett can help. Contact us today to schedule a consultation.