All posts by David

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.

Gunn v. Minton, Legal Malpractice, Community Property, and me.

Ethics

I was at one of the firms that Minton sued and, in fact, if I recall right I met Mr. Minton during the initial interview process.  Then I left the firm. The rest, as they say, is history.  Eventually, allegedly the firm did not properly plead the experimental use exception to the on-sale bar, and that, allegedly, caused Minton to lose his case. 

The case bounced around from state to federal court, but eventually the Supreme Court, on appeal from the Texas Supreme Court, did not present a federal question and so should be decided by the state courts.  Along the way, it said that there will seldom be a "backwards looking" malpractice claim that will be in federal court.  So, if a plaintiff claims that it should have gotten a broader patent, but did not because of negligence, chances are no federal jurisdiction.

I watched the oral argument in Gunn, and the Court (a) does not like or undertand patents; and (b) realized how far astray the CAFC's jurisprudence on subject matter jurisdiction had gone.  That's a bad combination.

But I'm writing because of an odd thing I encountered in a real state case involving state marital and estate law:  the spouse of a named inventor in some community property states has an undivided equal interest in the patent under state law.  In the case I was an expert in, the firm had obtained an assignment from a husband, but not the spouse.  The result was a claim by the spouse in the patent.

In a California case, which I was not involved in, this almost worked — the Federal Circuit seemed to acknowledge the spouse's interest in the patent, but held that a form that the spouse had filled out estopped her from claiming the interest.

So, the whole point of this "it is early Monday morning so don't complain if this is stream of concious" post is:  a state judge is going to be a lot more likely to follow state law on ownership rights than a federal judge will be, so watch out for the Gunn effect on this issue!

 

Social Media Ethics

Ethics

Yelp recently sued a bankruptcy firm for posting fake positive reviews, allegedly authored by the firm's employees, for breach of Yelp's terms of service.  The case is here.  I was reading a case recently about "google bowlling," where A puts up fake web pages and links to competitor B's webpage.  Google notices that these are not real web pages, and so demotes B's webpage ranking.  B then sues A.  I love technology.

Solicitor General: Don’t Grant Cert to Analyze Inequitable Conduct

Ethics,

A petition for cert was filed in a decision by Judge Linn, 1st Media, LLC v. Electronic Arts, Inc., 694 F.3d 1367 (Fed. Cir. 2012), asserting error essentially in Therasense's cabined view of inequitable conduct.  See Sony Computer Entertainment America LLC v. 1st Media, LLC, Supreme Court No. 12-1086.  The Solicitor General has filed a brief recommending against cert.  The petitioner's question presented was:

"Did the Court of Appeals for the Federal Circuit err in restricting district courts' equitable discretion in evaluating patent unenforceability, contrary to this Court's precedent in Keystone Driller, Hazel- Atlas, and Precision Instrument, by applying a rigid test that (a) forecloses district courts from considering the entire circumstantial record; and (b) precludes district courts from granting equitable remedies where a patent applicant has violated the PTO's duty of candor."

I filed an amicus brief in Therasense, and no one listened, but I still hold a lot of the same views expressed there.

Interesting Malpractice Case Based Upon Claiming Work Product Over Pre-Suit Testing

Ethics

When I speak on ethics, I always say that you never know how issues will get raised.  Things that seem like "academic" concerns turn out to be "gotchas".  This is not quite that, but it is a fun twist.

We all know that Rule 11 requires adequate pre-suit investigation, and, usually, the way breach of those rules get raised is through a Rule 11 motion.

Usually.

In a legal malpractice case, a patentee alleges that its lawyers' improper designation of testing that he had done as "work product" caused sanctions to be entered against him that, ultimately, reduced his patent infringement damages award.  Haase v. Abraham, watkins, Nichols, Sorrels, Agosto & Friend, LLP, 404 S.W.3d 75 (Tex. App. — Houston [14th Dist.] no pet. hist.).  The defendants won a partial victory on appeal.  The procedural history of the case involves two appeals to the Federal Circuit, among other things!

 

Exergen as the Guidepost for Findings to Support Inequitable Conduct

Ethics

As everyone knows, Therasense changed the substantive law of inequitable conduct, requiring but-for materiality (with the "affirmative egregious misconduct") exception, and intent to deceive the office.  (Debates rage on some aspects of this, but that's the core.)  Exergen, of course, held that Rule 9(b) applies to inequitable conduct allegations, requiring that the "who, what, when, where, and why" be pled.

Yet, I have seen examples of district court opinions finding inequitable conduct that do not, themselves, meet the pleading requirements.  It cannot be that findings that would not satisfy Exergen can, nonetheless, support inequitable conduct.

I'm surprised that no one has, as yet, made this argument (that I know of).  Exergen provides a roadmap for district court findings and conclusions, and also the means to attack findings of nequitable conduct on appeal when they fail to meet that standard.

Am I missing something?

A Random Thought on IPR, BRC, and Life

Ethics

In preparing for class, I was reading through the old case about product-by-process claims, which recognizes that under the broadest reasonable construction standard, a claim is unpatentable if the product is old, but it's valid, after issuance, if just the product is old.  In other words, the limitations are ignored during prosecution because the claims are viewed as product claims.  Atlantic Thermoplastics, 970 F.2d 834 (Fed. CIr. 1992).

Okay, so… this just makes my head spin.  Suppose a patent issues, covering "a shoe made by the process of A and B."  To invalidate the claim, an accused infringer would have to show the prior art had a shoe made by the process of A and B, but in IPR, he merely has to show the shoe in the prior art.

I don't even know how to make sense of that result.  Assume no stay, you end up with an unpatentable valid patent…. sort of ….

 

Soliciting Thoughts on Prosecution Bars

Ethics

Hi, all,

I'm writing an article and updating a chapter in a book.  I'd like to know if you have views on these questions.  Please think about these from the perspective of the purpose of these bars which, ostensibly, is to prevent a lawyer who is engaged in "competitive decision-making" (which includes some forms of prosecution, but not all) from misusing information disclosed by an opposing party during litigation to benefit the prosecution client.

1.  Currently, courts tend to make the length of the bar 2 years from the end of litigation, including any appeal.  (a) Is two years too long in some technologies? If so, which? (b) Whatever the appropriate length of time, should it be measured from the end of appeals?  If not, from what point in time?

2.  Should IPR be included?  Reissue (either within 2 years or outside)?  Other activities?

3.  Prosecuting patents is not enough.  What objective evidence should courts look for in deciding whether someone's prosecution activities rise to the level of "competitive decision-making"?  For example, presumably there is less of a concern where in-house counsel do the preparation and outside counsel essentially file and then prosecute from there.

4.  In your experience, are prosecution bars put in place too readily, or too unwillingly, or just about right?

5.  Other random thoughts.

All posts will become eligible to be read by me and maybe included in some roundabout way in the article.

David

Thoughts on the GAO Report and Implications for Legal Ethics

Ethics

Interesting read.  Again the full GAO Report is here.  The report is more balanced than I would have expected, pointing the finger largely at software patents, patent quality, and litigation costs, not NPEs.  

I know that Chief Judge Rader is doing his level best to try to reduce costs, as are many members of the judiciary, through model orders and the like.  When it comes to these costs, lawyers on both sides of the v have responsibilities.  

The plaintiff's side's responsibilities have been written about a lot:  primarily the need for adequate pre-suit investigation including careful infringement analysis.

The defense side's responsibilities are less often talked about (I think).  Defense lawyers paid by the hour can have conflicting interests:  there may be a clear path to dismissal of a suit or early settlement, but the billable hour is in tension with that result, at least where the client is not sophisticated enough in patent litigation to guard against that problem.  A while back, I was asked to write about the problem of trolls, and, not by design but through analysis, concluded that defense counsel faced some serious issues.  The article is here.

Now to work on the article about Section 285, which I think is the flexible solution to a lot of problems — despite the Federal Circuit's decision in Brooks Furniture!

Higher Pleading Standards for Direct Infringement?

Ethics

In recent years, the Supreme Court in Iqbal and Twombly required more than "notice" pleading.  But, under Rule 84, the forms in the appendix are deemed sufficient.  Form 18  requires very little to plead direct infringement.  Although the Federal Circuit has in a couple of cases limited the applicability of that form, e.g., R+L Carriers, Inc. v. DriverTech LLC, 681 F.3d 1323 (Fed. Cir. 2012) (Form 18 controls over Iqbal and Twombly for direct infringement, but not for indirect infringement) and K-Tech Telecommunications, Inc. v. Time Warner Cable, Inc., No. 12-1425 (Fed. Cir. Apr. 18, 2013)( any conflict between  Iqbal and Twombly and Form 18 hould be resolved in favor of Form 18 for direct infringement), but some say more robust pleading would reduce marginal lawsuits.

Those folks may soon have their way.  The Judicial Conference Committee on Rules of Practice & Procedure report at around page 275 of this report wants to abrogate Rule 84, and so eliminate the imprimatur given the forms.

Granted, Rule 11 and prreliminary infringement contentions and so on eliminate the practical scope of Form 18, but this may be a good thing.  Thoughts?

Some Random Thoughts on Good Appellate Practice at the CAFC

Ethics

I read a lot of briefs this last year while clerking at the CAFC, and developed some pretty unexpected opinions and some that confirmed "conventional wisdom."

First, the quality of briefing, even in signficant cases, is too often abysmal.  I too often saw some bad writing, bad reasoning, bad judgment, and bad research.  Fundamental issues were often overlooked. Smaller points:  don't load up your questions presented ("did the distict court err by ignoring the overwhelming evidence of deceit and foulness that was undisputed including sworn testimony by the Pope…").  Get the standard of review right, and focus on it in your argument.  The court does not decide everything de novo, and that principle does often matter.  The fact that a judge thinks the jury was "wrong" does not matter if the question is substantial evidence, for example.  Cast your arguments in terms of the standard of review!

Second, a lot of people say you should "never" use trial as appellate counsel. I would never say never, but I would say that even if it makes sense to use trial counsel on appeal (economically, or for whatever reason), have someone else with appellate experience read the briefs and moot the lawyers.  The CAFC is not a jury, and sometimes skill sets that do great at trial don't fare so well on appeal.

Third, do not — do not, do not, do not — raise more than you absolutely need to on appeal.  If you are raising more than three or four broad errors, you better have a very good reason to do so.  Why?  First, you don't have space.  Second, think about the message you are sending: the district court got nothing right.  Third, chances are some of those arguments are weak. They will weigh down the better arguments.  They give the other side easy targets.  Don't hand the other side a hammer.

Fourth, at oral argument, cut to the chase.  Don't start with a bunch of hot air.  Don't spend time to castigate opposing counsel or the district court. Explain, dispassionately but effectively, what was wrong and how it warrants appellate relief.  And, know the record.  Moot the argument before hand with people who have read, only, the briefs and appellate record — not those who tried the case. Also, if you sense the panel is done with your argument, especially as appellee, ask if they have any other questions and if not, sit down, shut up, and think about having a nice coffee afterward. You do not need to talk until the red light goes on.  Oh, and when the red light goes on, stop or ask permission to finish your remark. If the red light goes on and the court says "do you have any final words" say two sentences, not twenty.

Fifth, if you won below, think VERY carefully about cross-appeals. You may not be able to raise as an alternate grounds to affirm invalidity, for example, if you won non-infringment.  Think carefully about claim construction.  Again, you probably need an appellate person to help you out, not just trial people, and, more particularly, someone familiar with CAFC appeals.

Sixth, be respectful in the briefs.  I know how hard this is; I was a lawyer for a long time (well, I still am but I was ONLY a lawyer for a long time).  Things get heated.  Judges sometimes seem to favor the other side.  Money gets wasted and clients are unhappy with that. Usually no one wants to be in litigation.  But it does not help your cause to let heat obscure the light. Be respectful.

For what that's worth.

Prosecution bars and the burden of proof and production

Ethics

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?

On Trolls

Ethics

I wrote an op-ed with Chief Judge Rader and Santa Clara law professor Colleen Chien in the New York Times this past year.  It's here.  I love the art work.

I'll write more about 285 shortly, and will not respond to comments here, but was dismayed at some of the comments this op-ed engendered.  Some people have good disagreements and criticisms.  But I read how I was a "West coast law professor" (check your geography, bud!) who had never litigated a contingent fee case (check my bio, bud!).  Anyhow, more on the legal aspects of 285 shortly.  I'm in the midst of reading a slew of cases for the next edition of one of my books and so am having too much fun with other things now…

 

 

Thinking of investing in a business that competes with a former client?

Current Affairs, Ethics

Then you should read Texas Ethics Opinion No. 626 (April 2013).  The opnion is quite broad:  L represents Corporation A and acquires non-public proprietary information about its competitive position in the field.  L's representation ends when Corporation A is sold, but the corporation continues on in its business.  L now proposes to make a significant investment, passive, in competing Corporation B.  L "is not involved in the organization or formulation of the initial business plan of Corporation B and he does not provide legal services or otherwise participate in the management or operation of Corporation B's business."

The opinion relies on the principle that L may not use confidential information to the disadvantage of Corporation A.  The opinion noted that L would be using his knowledge of Corporation A in investing, his decision to invest "could reveal to interested person information concerning the lawyer's assessment of Corporation A that is based on confidential information," and so he could not do so, absent (a) informed consent after full disclosure (ha!), (b) if it was an insignficant investment (which depended on the facts, but which was characterized as "a sufficiently small portion of the total amount invested in Corporation B and there were other investors ready to make an investment in the same amount if the lawyer did not"), (c) he had not gained any pertinent confidences, or, (d) though he had, the information had "ceased to be relevant" to Corporation A's business.

The significance of this opinion to patent lawyers should be clear. I also note that many states, including Texas, allow adverse use of information against former clients once it has become generally known.  Because the opinion focuses on unique aspects of the Texas Rules, the central point of the opinion might not hold true in every jurisdiction.

Some recent cases on Prosecution Bars

Current Affairs, Ethics

A couple recent cases have addressed several key issues with prosecution bars.  As you know, it has become common for protective orders in litigation to include provisions that prohibit a person from receiving certain highly proprietary information if that person engages in "competitive decision-making," which can include patent prosecution.  

In Unwired Planet LLC v. Apple Inc., 2013 WL 1501489 (D. Nev. Apr. 11, 2013), Apple persuaded the district court to expand the bar to prevent outside counsel who had access to certain Apple confidential information from giving advice on "patent acquisitions."  The district court found that there was a risk that Unwired would determine which patents to buy to target Apple products.

The other issue that is percolating has two aspects to it:  do existing prosecution bars cover IPR and, if not, should they?  The first issue turns on the language of the existing protective order.  The second on whether IPR permits the same sort of risk of patent prosecution.  These issues were litigated in Politec Inc. v. Scentair Tech., Inc., 2013 WL 2138193 (E.D. Wis. May 17, 2013), which reached an odd balance.  It held that IPR was within the scope of the bar, but allowed outside counsel to participate but prohibiting them from amending, substituting, or adding claims during IPR.

If you have an existing protective order, these cases counsel to examine whether it is broad enough, either for IPR or for other activities.

Hello, everyone!

Current Affairs, Ethics

I just finished my clerkship with Chief Judge Rader, and have arrived back at Mercer Law School.  What an amazing and transformative year.  It was an honor to serve the court.

In my absence, the PTO adopted new ethical rules.  The rules are here, on a page that includes some helpful tables comparing the PTO rules to the Model Rules, and other information.

Unlike the effort in 2003, this time the PTO in large part adopted a slightly-out-of-date version of the ABA Model Rules, with a couple exceptions (including, for some odd reason, the choice of law provision).  There are now fewer differences between the ethical rules that apply to discipline in OED proceedings and those that would apply in state disciplinary proceedings, but key differences exist.  One is that the PTO did not adopt any private-practice screening provisions, but several states permit screening to be used, even over the objection of a client, to avoid a conflict caused by a lawyer migrating from one firm to another.  I'm still working through them, and will post more as I go.

David