In year 2004, Company B buys full rights to a patent which was filed in 1999 by the original owner, an individual. The patent was issued in 2003, and from 1999 till 2003, the original owner did not use the patent or apply it to the maketplace.
Patent rights are only enforceable once a patent actually issues; "patent pending" has no legal meaning, and there are no rights associated with a pending patent that can be asserted against someone else. So, here, the patent could only be enforced against someone in 2003, after the patent actually issued.
The fact that the original owner did not try and use or market his invention is irrelevant; patents in the U.S. are not "use it or lose it;" a patent stays valid until it expires, or until it is ruled invalid in litigation. That's not true in some other countries, but it is here. Once a patent is obtained the owner can pretty much do what he wants with it -- even if it means simply keeping others from making something.
Company A did do a patent search, but did not find this particular patent.
Also irrelevant, at least from an infringement point of view. Just because you didn't find the patent doesn't have anything to do with whether you are infringing or not. However, you are not charged with "notice" until the patent owner actually notifies you that he believes you are infringing -- notice is important because, up until you have "notice." you are simply an "innocent infringer" -- you'll still be liable for infringement, but the penalties are much less harsh than they are from a "willful" infringer -- someone who continues to infringe once they've been put on notice.
NOTE: This is different from copyrights -- if a copyright is registered with the U.S. copyright office, everyone is automatically charged with "notice" whether or not they searched the copyright database or were notified by the copyright owner.
Now, the question is, can Company B, who purchased the patent, apply it retroactively and claim the 'prior use of prior art' of Company A is a patent infringement?
Yes, but only to the point that the patent issued. Anything done before the patent issued is, by definition, not infringement because there was no patent in existance to infringe. However, once the patent issues, there can be infringement, and a new owner is entitled to assert all of the rights of the original owner. Patents are freely assignable, and whoever owns the patent can assert the rights, even if they didn't own the patent when the infringement occured.
Now, there are the concepts of "laches" and "equitable estoppel," which are two similar (but not the same) concepts that basically say it is unfair for a patent owner to sit on his rights and let damages accumulate -- basically, you have to assert your rights or lose them. However, even though you would raise these defenses if you were actually sued, the time fram we are talking here is what, a year, year-and-a-half since the patent issued, so that would likely not be long enough to raise laches as a real defense to infringement.
If you are being accused of infringement by the patent holder, get to a patent attorney ASAP -- accusing someone of patent infringement is a very big deal, and whoever moves first can often get a decided advantage over the other party. For example, if they accused you of infringing without really investigating thoroughly whether or not you likely are, they could get in trouble with the courts. If they accuse you without suing, you may want to preempt their suit by filing against them for a declaratory judgment on the validity of the patent and whether or not infringement is occuring -- by suing them, you control where the case will be heard, to some extent. These are trial tactics that can be discussed with an attorney.
If you are already being sued, you already know you need a lawyer...
Finally, if you think you are possibly infringing this patent, even if you haven't been accused or sued yet, you STILL might want to see a lawyer to get a noninfringement opinion -- basically, if a lawyer can give you an opinion that you are not infringing, even if you get sued and lose, at least you won't be found to be "willfully" infringing the patent -- it helps mitigate your damages. Further, an attorney might be able to help you "design around" the other patent and avoid infringement altogether.
