Only One Bite

Submitted by patentadmin on Wed, 03/23/2011 - 16:44

We have written often of the plague of false marking suits which are yet another obstacle to manufacturing in America. Now, with great satisfaction, we can report that the lowlife plaintiffs – technically known as “relators” – who bring these suits are becoming an obstacle to each other. (Thomas A. Simonian v. Irwin Industrial Tool Company)

On February 24, 2010, Mr. Simonian filed suit alleging that Irwin Tool, a subsidiary of Newell Rubbermaid Inc., was marking its “Shur-Line” Paint Edger and “Shur-Line” Trim and Touch Up Pads with the number of an expired patent (the `148 patent). Irwin admitted that the patent in question had expired in 1974.

On February 17, 2010 – one week before the filing of Mr. Simonian’s suit – FLFMC, Inc. filed suit alleging that Ace Hardware Corp. was selling a product, called the Trimline Edger, which was marked with the number of an expired patent. Ace purchased the Trimline Edger from Newell’s Shur-Line business. The patent number marked on the Trimline Edger was the same one (the `148 patent) marked on the “Shur-Line” Paint Edger and the “Shur-Line” Trim and Touch Up Pads. This case was settled. The settlement agreement provided that, “the Released Claims include any … liability with the Expired Patents and any Newell Product marked with one or more of the Expired Patents.” The term “Expired Patents” was defined to include the `148 patent.

On August 10, 2010, Clip Ventures – an appropriate name if ever there was one – filed suit against Newell, also alleging false marking of the Shur-Line Paint Edger with the `148 patent. This case was settled on or about September 23, 2010. The settlement agreement included a release substantially the same as the release in the FLFMC case. On September 27 and 29, 2010, the United States authority with responsibility for false marking suits informed the counsel for Clip and FLFMC that the government would not object to these settlements.

Subsequent to the Clip and FLFMC settlements, Mr. Simonian awoke to the fact that he had sued the wrong party. He should have sued Newell, Irwin’s corporate parent. When he moved to amend his complaint to name Newell as the defendant in his legalized extortion scheme, Irwin objected on the grounds that the Clip and FLFMC settlements had released Newell, its parent, from all liability from marking Newell products with the number of the `148 patent.

Case DISMISSED. “Having received money from Newell in exchange for broad releases of any claims of improper marking by [Newell] or of [Newell] products with the `148 Patent, the United States has relinquished any right to damages from [Newell] in another lawsuit alleging improper marking with the same expired patent. The broad general releases encompassed both known and unknown claims. The claims in Mr. Simonian’s complaint unambiguously fall within the broad releases in the Clip Ventures and FLFMC settlement Agreements.” Mr. Simonian goes home empty handed.

THE LESSON TO BE LEARNED: You only get one bite at the apple; read releases in related cases before proceeding to sue.

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