Prosecution bars and the burden of proof and production

The proponent of a protective order has the burden to show good cause for its entry, as per Rule 26.  Some courts are requiring that the party seeking a prosecution bar establish that the other side's counsel is engaged in "competitive decision-making."  E.g., Clayton Corp. v. Momentive Performance Materials, Inc., 2013 WL 2099436 (E.D. Mo. May 14, 2013).

That is unworkable.  In Clayton, the court denied a bar because the lawyers seeking it didn't submit affidavits showing what opposing counsel was doing for their client.  

How could they?

It seems a much better approach is to place the burden of showing that the information being disclosed is "important enough" to warrant a bar, and, if the opposing party objects to inclusion of a prosecution bar, to require them to establish that they are *not* engaged in competitive decision-making. 

Thoughts?

About David

Professor of Law, Mercer University School of Law. Formerly Of Counsel, Taylor English Duma, LLP and in 2012-13, judicial clerk to Chief Judge Rader.

11 thoughts on “Prosecution bars and the burden of proof and production

  1. 11

    David, on “related,” perhaps courts could tailor the bar to

    “continuations, divisionals, CIPs and foreign counterparts, related applications, and broadening reissues of any of these.”

    Related application need not be defined with any specificity as these legally defined.

    I do not agree that narrowing reissues, reexaminations or IPRs should be included as the claims cannot be amended to cover products they did not already cover. To the extent that prosecution bars go this far, they go too far and seek to strip a patent owner of their best counsel.

    As to the Apple case, acquiring patents unlicensed by a competitor can enhance one’s ability to prosecute a patent war. But is patent infringement really competition? Does one have the legal right to infringe? I think we need to pause and consider what competition means.

    That said, I think the prosecution bar would extent to pending applications acquired.

  2. 10

    Ned,

    I think the risk of misuse includes the prosecution problem you mentioned, but is not limited to it. It’s not only continuations; it can occur in original prosecution as well. It can arise in re-exam, IPR, and other proceedings (all varying by the facts and the lawyer’s role in the proceeding, and the information itself, of course).

    You are right, of course, that “competitive decision-making” is the test: not all prosecution is competitive decision-making (so held the CAFC in Deutsche Bank), but nor is competitive decision-making limited to only prosecution. I’ve not read the Apple case closely enough to know whether I think that was the right result (and am not sure the reported opinion gives all the information I would want), but I certainly can see the potential for misuse of information in that circumstance.

    Finally when you state “related applications” you state the problem, not the solution. What is “related enough”? One thing I find quite interesting is that there are several “rules” designed to protect against misuse of information, but they all have different scope. That seems odd!

    David

  3. 9

    David, in the case of real prosecution, the real problem arises in pending continuations of the asserted patents that the applicant may amend to overcome prior art, remove unnecessary limitations, and tailor to directly read on the competitor’s products.

    If taken beyond this, the so called prosecution bar becomes something else. It becomes a way of excluding any counsel that might be involved in any competitive decisionmaking regardless of whether that counsel is inside or out.

    This we have counsel barred from advising on patent acquisitions. That really has nothing to do with competition, now does it?

    I think the prosecution bar needs to be cabined to related applications, period, of the competitor or patent holder. Specific likelihood of use must also be suggested, although in the case of continuations, this might be presumed.

  4. 8

    Ned,

    I think the burden of persuasion is always on the party seeking the bar. The way I think courts are, correctly, making it work is:

    Party seeking the bar shows that a typical “don’t misuse this info” provision isn’t enough because there’s ultra-secret information and/or it can show the opposing lawyers are “competitive decision-makers”

    Burden of production shifts to other side to show, lawyer-by-lawyer, that a lawyer who is going to see the ultra-secret information is not engaged in competitive decision-making (the CAFC in Deutsche Bank made it clear that not all patent prosecution is competitive decision-making).

    Court determines whether burden of proof — good cause for a bar — was sustained.

    I personally think that a lot of the bars I see are too broad in some respects. There’s an old case I gave an opinion in, where the court cited me, where I raised the concerns you talk about. For the life of me I can’t remember which case it was, though. I’m writing about them now….

  5. 7

    David, this really strikes at patent attorneys and hits them hard, because as a practical matter all patent attorneys face a choice, become full time litigators or stay full time patent attorneys.

    We need to keep the presumption the way the Fed. Cir. set it in US Steel. Status alone is not enough. Being a patent attorney is not enough, not even practicing in the same technology.

    I would think the producing party should be required to show that the patent attorney is prosecuting a continuation or named related application of a patent in suit. Only there is the harm specific enough to warrant concern.

  6. 6

    I’ve run it down and there are some odd ball cases that get it backwards, but it’s clear under Deutschebank and the majority of district courts that it operates where counsel has to show that they do not engage in competitive decision-making. The only way it could, practically, work. Buy the next edition of my book to learn more!

  7. 5

    Sorry David, but the ‘blame words’ highlight the practical question, rather than fog it.

    Sure, the words are emotionally charged. But they are no less accurate for the emotion they carry. In fact, the emotion sharpens the answer – the opposite of the ‘fog’ you suggest.

    I also do not see an answer as to (restated for you): If the person making the motion does not or cannot know the substance of the motion, then the motion simply should not be made.

    Thanks

  8. 4

    US Steel v. US, 730 F.2d 1465 (Fed. Cir. 1984) held that blanket bans are unacceptable. That is the law and it is following in all cases involving prosecution bars, which are a matter of Federal Law. In re Deutsches Bank, 605 F.3d 1373 (Fed. Cir. 2010)

  9. 3

    Here’s a district court adopting what I think is the right approach — Maxim Integrated Products, 2012 WL 5398858 (W.D. Pa. Nov. 2, 2012). Once the movant shows the bar is needed, the other side has to show a lawyer should be exempted from it.

  10. 2

    I don’t know that I see an “accusation” that someone is engaged in important work for their client, but even assuming so, the person “making the accusation” is disclosing its highly confidential proprietary information.

    Using blame words just fogs the practical question.

  11. 1

    You want an accused person to prove a negative?

    Shouldn’t the person making the accusation have some basis for the accusation in the first place?

    Why is this ‘unworkable?’ If the person making the accusation does not or cannot know the substance of the accusation, then the accusation simply should not be made.

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