Addressing issues ranging from obviousness to damages, and resolving a split among district courts, the US Court of Appeals for the Federal Circuit found that the burden of proving a marking defense does not necessarily remain on the defendant. Rather, when an accused infringer challenges compliance with the marking requirement of § 287(a), it need only identify the unmarked products sold or licensed by the patentee that it believes are covered by the patents in suit, at which point the burden shifts to the patentee to show that the identified products do not practice the patented invention. Arctic Cat Inc. v. Bombardier Recreational, Case No. 2017-1475 (Fed. Cir., Dec.7, 2017) (Moore, J).
Arctic Cat licensed Honda to manufacture and sell products under certain patents. The license agreement explicitly stated that Honda "shall have no obligation or requirement to mark" the licensed products. Arctic Cat then sued Bombardier for infringement of two of the licensed patents, and Bombardier was found to infringe the patents at a jury trial.
Bombardier moved for judgment as a matter of law (JMOL) to limit damages, arguing that Arctic Cat failed to comply with the marking requirement because Honda had not marked allegedly patented products. The district court denied the JMOL motion, finding that Bombardier had not proven that the Honda products were covered by any of the patents in suit. Bombardier appealed the district court's denial of JMOL on validity, marking, damages and willfulness, as well as its grant of an ongoing royalty and decision to treble damages.
As for the marking issue, the Federal Circuit agreed that the accused infringer bears the initial burden of identifying which products it believes to be unmarked patented products. The Court characterized the burden as a "low bar" and explicitly noted that the accused infringer is not obliged to provide claim charts reading the claims of the patents in suit on the licensed products. The Court then explained that the accused infringer does not bear any further burden. Once the accused infringer meets its initial burden of identifying unmarked products, "[t]he burden of proving compliance with marking is and at all times remains on the patentee."
Thus, the patentee has the burden of proving that the identified products do not practice the patented invention. Because Arctic Cat had not been provided with a meaningful opportunity in the district court to show why Honda's products were not covered by the patents, the Federal Circuit vacated the district court's ruling on this issue (only) and remanded the case for further proceedings.
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