'Qui tam' provision found unconstitutional in Ohio false patent marking case

Nicole Keenan Mar. 3, 2011, 2:57am

On Feb. 23, the Northern District of Ohio and specifically U.S. District Judge Dan Polster issued an important opinion – in Unique Products Solutions Ltd v. Hy-Grade Valve Inc. - granting a motion to dismiss the false marking case on the grounds that the qui tam provision is unconstitutional.

Defendant Hy-Grade filed the Motion to Dismiss arguing that 35 U.S.C. §292(b) violated the Appointments and Take Care Clauses of the U.S. Constitution by failing to give the executive branch sufficient control over the litigation.

The Court noted that because the false marking statute is a criminal statute, the court must determine whether the statute provides the executive branch "sufficient control to ensure that the President is able to perform his constitutionally assigned duty to 'Take Care that the Laws be faithfully executed.'"

Applying such "sufficient control" analysis to the false marking statute, the Court held that "the false marking statute essentially represents a wholesale delegation of criminal law enforcement power to private entities with no control exercised by the Department of Justice" and ruled that the statute is unconstitutional under the Take Care clause.

In light of the large number of false marking cases pending not only in the Eastern District of Texas but in courts around the country, it will be interesting to see whether other district courts will hold the same.

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