In a December 31, 2013 ruling, Judge Jed S. Rakoff denied the parties’ cross-motions regarding infringement, granted defendants’ Microscan Systems, Inc. and the Code Corporation’s motion for partial summary judgment, and ruled that plaintiffs Cognex Corporation and Cognex Technology & Investment LLC were not entitled to damages for patent infringement prior to providing actual notice of the alleged infringement to the defendants, and further sanctioned plaintiffs for spoliating evidence. The plaintiffs plead in the complaint that damages should run from actual notice of the patent-in-suit, and later sought to add a constructive notice theory. In considering the date from which patent infringement damages may be awarded, the Court recognized that the patent statute requires that “when a patented article has been produced by a patentee or its licensee, the amount of damages the patentee can recover in an infringement suit is statutorily limited to those acts of infringement that occurred after the patentee gave the alleged infringer notice of infringement.” While the statute permits either “constructive notice, which is accomplished by marking the article with the patent number, or actual notice,” the court nevertheless held that “when a patent owner or licensee makes or sells a product that embodies at least one claim of a patent but does not mark that product as patented as required by 35 U.S.C. § 287(a), damages are limited to the period beginning when the patentee provides actual notice of infringement.” As the plaintiffs failed to plead compliance with the marking statute, the Court ruled that allowing the plaintiffs to amend the complaint in order to comply with the marking statute at the summary judgment stage would unduly prejudice the defendants because the defendants would have been entitled to discovery on the constructive notice theory which they did not pursue. Accordingly, the plaintiffs were permitted to collect infringement damages only for the period after the date on which the actual notice of the infringement was provided to the defendants.
