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17 August 2020Jurisdiction reportsPaul J Sutton

US jurisdiction report: COVID-19’s impact on US patent practices

Pharmaceutical researchers across the country are desperately seeking an effective vaccine against COVID-19. Manufacturers that are seeking to serve the public interest by retooling their facilities to produce masks, gloves, and products needed to help combat the pandemic may face the risk of patent infringement liability.

This risk may expose them to sanctions due to wilful infringement, and such sanctions may include money damages as well as injunctions. This environment will undoubtedly give rise to claims and lawsuits filed by practising and non-practising entities, the latter commonly referred to as “patent trolls”.

Avoiding liability

Potential liability for patent infringement may be avoided by making products for the US government, which will mitigate risk. Title 28 of the US Code section 1498 provides the government with a powerful weapon to counteract outrageous pricing and other practices resulting from the pandemic. Under this federal statute, a manufacturer, without permission, cannot be held liable for patent infringement where it produces a patented product for the US government, provided it grants reasonable compensation to the patent owner.

Other ways to avoid such patent infringement risk are to seek a licence from a patent owner, or to arrange for indemnification from purchasers. Some states have indemnification provisions that protect manufacturers. There is also the wise but costly option of obtaining a well-reasoned freedom-to-operate opinion from competent patent counsel.

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