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.

Administrative Suspension

You have to pay bar dues for your state, meet CLE requirements, and so on, or you can be administratively suspended by your state.  If you are, you can’t practice trademark law before the USPTO.  There was another recent OED decision recognizing that basic point, here.

The USPTO once considered making practitioners take CLE, but that failed. But, you can be administratively suspended by the USPTO for various reasons, including failing to keep your contact, and other, information current under 37 CFR 11.11. The USPTO periodically sends surveys to practitioners and those who don’t respond get their names published, and if they fail to correct the problem, they get administratively suspended from patent practice, as shown here.

Either circumstance can create lots of problems for practitioners.  You may need to alert the USPTO of state administrative suspension, or you may need to alert your state of USPTO administrative suspension, and so administrative suspension can snowball into a reporting problem.  Further, complicated questions are created for your clients, such as (a) trust fund issues; (b) privilege issues; (c) perhaps unauthorized practice of law problems (e.g., a corporation has to be represented by a lawyer); and (d) substantive issues, such as whether something filed with the USPTO by an administratively suspended practitioner can be held ineffective or otherwise cause invalidity or unenforceability problems.  And, of course, communicating administrative suspension to a client once it is known is another one.

So, pay those bar dues, go to your CLE, and keep your contact info updated.

An Interesting Pending Appeal Involving Violation of an NDA to Prosecute an Application

Last month, the Federal Circuit held oral argument in an appeal, styled Gilead Sciences, Inc. v. Merck & Co., Inc. (Appeal Nos. 16-2302 & -2615) from a judge’s decision which held a patent unenforceable — for unclean hands — after a jury returned a verdict of $200 million.  A more detailed write up is here which includes a link to the oral argument.

Boiled down, in a bench trial after the verdict, the judge heard evidence that Gilead had agreed to share information with Merck regarding an antiviral agent against Hep C — provided Merck personnel working on Merck’s competing work be walled off rom the information. Gilead shared information on a call… and a Merck attorney who was on the call who was prosecuting a Merck competing application then amended claims to cover the Gilead product.

As a twist, the application that was amended supported the Gilead product, and the jury had found no derivation.  The reason was that the amended Merck application had support for a large genus of compounds, but the amendment narrowed to a subgenus which included Gilead’s leading agent.  In other words, Merck had invented the Gilead product, and so there was no but-for materiality (in any meaningful sense that I can see, at least).

In addition to this evidence, the district judge heard evidence of various litigation misconduct, testimony that seemed to change at trial, and other “smell test” issues.  Based on what it saw, the district judge  held the Merck patent unenforceable under the doctrine of unclean hands, setting aside the $200m verdict for Merck.  The judge wrote in part:

“In this case, numerous unconscionable acts lead the Court to conclude that the doctrine of unclean hands bars Merck’s recovery against Gilead for infringement of the ’499 and ’712 Patents. Merck’s misconduct includes lying to Pharmasset, misusing Pharmasset’s confidential information, breaching confidentiality and firewall agreements, and lying under oath at deposition and trial. Any one of these acts— lying, unethical business conduct, or litigation misconduct— would be sufficient to invoke the doctrine of unclean hands; but together, these acts unmistakably constitute egregious misconduct that equals or exceeds the misconduct previously found by other courts to constitute unclean hands. Merck’s acts are even more egregious because the main perpetuator of its misconduct was its attorney.”

Gilead Sciences v. Merck & Co., Case No. 5:13-cv-04057 (N.D. Cal. June 2016).

On appeal, the CAFC panel asked questions which seemed to suggest they were wondering whether there was, in fact, derivation — despite the jury’s finding.  From afar, that would seem to be a stretch, but the details may be there.  Stay tuned on both aspects of this case.

The lesson, of course, is that it is imperative that people abide by NDAs (and protective orders with prosecution bars, and the like).  I’ve been involved in cases involving alleged misuse of confidential information during prosecution, and the risks that arise when competitors exchange information — ranging from trade secret misuse, to sanctions, to things like Merck — abound.  Lawyers need to police both their side — to abide by any agreement, by watching for misuse by experts, inventors, business people, and lawyers — as well as ensuring that their own personnel abide by the agreement.  With parallel proceedings, continuing prosecution, and the circumstances where parties are focused on similar solutions to a problem, the need to do so is particularly critical.

King Spalding DQ’d from arbitrating against Former Client

A February 22, 2018 order in Merial Inc. et al. v. Abic Biological Labs. Ltd (Sup. Ct. N.Y.), here, enjoined King & Spalding from representing Abic Biological Labs (“Abic”) and Phibro Animal Health Corporation (“Phibro”) in an ICC arbitration where Abic and Phibro were adverse to Merial Societe Par Actions Simplifiee (“Merial SAS”), which was a former K&S client.

The evidence appears to have shown that K&S had represented Merial SAS, and related entities, from 1998 to at least 2011 concerning transactions and litigation in the animal health and vaccine space.   K&S had also for many years represented Phibro and related entities in the animal health and vaccine space.

Merial SAS was acquired by Boehringer Ingelheim GmBH (“Boehringer”) in 2017, and K&S had represented an affiliate of Boehringer until December 2017. In the summer of 2017, Merial and Boehringer became cross-wise, and until then, none of the Merial parties knew that K&S had been representing Phibro.

In the summer of 2017, K&S wrote a letter to the person that it had often interacted with, the head of prosecution and litigation at Merial SAS (Dr. Jarecki-Black), explaining that K&S was representing Abic and Phibro in a licensing dispute they had with Merial SAS (and other entities).  Dr. Jarecki-Black responded by asserting that K&S’ representation presented a conflict of interest and demanding that K&S withdraw.  A few weeks later, the firm refused, explaining in a letter that it had represented different corporate entities in the matters Dr. Jarecki-Black pointed to, the matters were in all events unrelated to the ICC licensing dispute, and no K&S lawyer who was working against Merial SAS in the ICC matter had represented it previously.  In response, Merial SAS reiterated its positions, and its letter also made a new (and very odd) argument: because the license in dispute included a New York choice of law clause, a California lawyer from K&S who was representing Phibro was engaged in the unauthorized practice of law.  In its final letter, K&S reiterated that there was no substantial relationship between its work for and the work against Merial SAS, and made short shrift of the odd argument about the unauthorized practice of law.

It seems the parties could not agree on who was right, and instead Merial SAS filed suit in New York seeking an injunction to prevent K&S from being adverse to it (and Boehringer, and affiliated entities) in the ICC.

The court enjoined K&S.  What struck me as quite concerning was that there was no overlap between patents or licenses K&S had worked on for Merial SAS and those in the ICC arbitration.  Instead, the court noted that K&S “clearly knows a great deal about how the Merial entities approach issues relating to patents and licenses in the animal health and animal vaccine space.”  The trial court emphasized that Merial SAS had relied on “a highly credentialed ethicist, Roy D. Simon” and noted that, although the decision was for the court to make, “King & Spalding offered no expert testimony to rebut Mr. Simon’s expert opinion.”  The court then noted that “a reasonable lawyer like Mr. Simon came to the conclusion that King & Spalding’s multiple representations of [Merial SAS entities] on issues meaningful to the limited number of players in teh animal health and animal vaccine space would materially advance Abic and Phibro’s interests vis-a-vis Merial,” particular because Dr. Jarecki-Black “will play an integral role in Merial’s defense” in the arbitration.

There are several things of note. First, it is unusual for actual injunctions to be sought (rather than disqualification), and usually injunctions are litigated quite differently from motions to disqualify, but K&S appeared to litigated this as a basic disqualification motion.  Second, from the opinion, at least, the injunction was granted based upon what is called “playbook” information — knowing how a client litigates or otherwise behaves, not actual specific confidential information — which is also atypical in some jurisdictions.  Third, and from afar, this was not correctly decided, which underscores the point that whenever a firm is faced with a disqualification motion, it should consider the need for expert testimony (and Professor Simon is a highly credentialed ethicist; I don’t think he knows much about patents or licensing), and the need to show — although it’s the other side’s burden — there is no real risk of misuse of confidential information.

PTAB Candor Versus Rule 56 Versus Therasense

Over the last year or so, I’ve given a half dozen talks to practitioners about the differences between the duty of candor in PTAB proceedings compared to general prosecution and Therasense.  Each time I do, I can tell the audience is learning that when you’re in IPR, you ain’t in Kansas any more.

The key issue is who is covered by a duty of disclosure.  Under Rule 56, and Therasense, only the knowledge of persons “substantively involved” in prosecution “counts” and must be disclosed.  (The language of Rule 56 says so, and the Federal Circuit has followed that language in a few cases even though technically it does not control inequitable conduct which is a statutorily-based defense under 282(b)(1) of the Patent Act.)

In contrast, in PTAB proceedings there are two rules that relates to candor, and they are extraordinarily (and, I believe, unintentionally) broad.   (Rule 56 does not apply in prosecution; other rules do.). Oddly, neither rule is the same as Rule 56, and each rule also differs from each other — and for no apparent reason.

The general rule of candor in 37 C.F.R. 42.11(a) provides:  “Parties” — stop there and think about what that means — “and individuals involved in the proceeding” — again, stop and recognize that substantive involvement in the proceeding is not required — “have a duty of candor to the Office during the course of a proceeding.”  Yes, the rule says a “party” owes a duty of candor, so ostensibly the knowledge of every person who works for a party “counts.”  How many people work for Google?

The other candor rule applicable in PTAB proceedings is triggered when a party files a paper with the Office.  It provides that, unless the information has already been served, a party “must serve relevant information that is inconstant with a position advanced by the party during the proceeding” when filing the paper, and (now for the “who” part) this “requirement extend to inventors, corporate officers, and persons involved in the preparation or filing of the document or things.”

Notice that you cannot read either rule to means something less than what it says without running into basic statutory interpretation problems.  For example, you can’t read it to mean “inventors and corporate officers who are involved in the proceeding” because that renders the words “inventors” and “corporate officers” superfluous.

So, when you’re involved in a PTAB proceeding, be very careful about whose information may “count” for purposes of inequitable conduct during the proceeding.  To be clear:  I think the rule can’t mean what it says, and I’ve advocated that both rules be changed to be identical to Rule 56 (in terms of who is covered, at least), but my belief doesn’t overcome the text of the rules.

In re Silver – Texas Supreme Court Follows CAFC Lead and Recognizes Limited Patent-Agent Privilege

I know Dennis posted on the main page, but wanted to post now (after trial is over, thank goodness!) that the Texas Supreme Court finally issued its opinion and held that, so long as the communication relates to practice before the Office, there is a privilege over communications involving patent agents and clients.  The opinion is here.  (I wrote an amicus brief in it.)

I’ve written about Queen’s University, the CAFC case that recognized a privilege over patent agent communications, and the dissent by Judge Reyna who (properly) recognized that if its scope is limited to what agents are authorized to do, patent agents may need lawyers to advise them about the scope of the privilege.

So, the opinion is good news but extreme care still should be exercised over non-supervised patent agent-client communications.

More analysis of using information of a former client

As noted below, the ABA recently published an opinion giving guidance to an oft-raised issue in patent practice of what, exactly, is “confidential” information of a former client (e.g., is a published patent application you wrote for a former client nonetheless confidential?).  An interesting follow on to the ABA opinion is available here.

FAA Preempts Challenges to Unethical Arbitration Clauses

This is a non-precedential Third Circuit decision, Smith v. Lindemann (3rd Cir. No. 16-3357 (Sept. 21, 2017), and it’s dicta, but it is worth noting because I have blogged about arbitration and awards that violate public policy, as set forth in lawyer ethical rules, before.

In this case, the client sought an order from the district court that her legal malpractice claim was not subject to arbitration because New Jersey prohibited agreements requiring arbitration of malpractice claims and, even if it were sometimes permitted, the client had to give informed consent.

The court quickly rejected the first argument because there was no case law that supported it.  But then in dicta, the court stated that even if state law did prohibit agreements requiring arbitration of malpractice claims, or even if the clause did not meet the requirements of applicable ethical rules, that law and those rules were preempted by the FAA.

In pertinent part, the court stated:

The Supreme Court has held that the FAA requires courts to put arbitration agreements “on equal footing with all other contracts” and that they may not interpret state law differently in the context of arbitration. See DIRECTV, Inc. v. Imburgia, 136 S. Ct. 463, 470 (2015) (quoting Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443 (2006)). So, to the extent Smith seeks a more searching review of the advice attorneys provide new clients when an agreement to arbitrate is at issue, her argument is foreclosed by the FAA. See id. We need not decide that question, however, because she fails to explain why a written or oral warning that explicitly uses the word “malpractice” is necessary as a matter of New Jersey law.

The case raises some serious federalism issues, and probably actually is inconsistent with the Supreme Court’s holdings, which permit challenges to arbitration clauses based upon statutes and, in some circuits, other public policies.  Given the limited review of arbitral awards, and — at least in this panel’s view — the limited ability of courts to rely upon ethical rules to refuse motions to compel arbitration, clients should be careful about agreeing to arbitration awards and lawyers should probably consider beefing up disclosures about them.

Apple: Patent Owner’s Former CEO’s Ex Parte Letters to PTAB & Commerce Secretary Ross are Sanctionable

Apple has filed a motion with the PTAB, here, asserting that letters from the former CEO of a patent owner to an original panel, a substitute panel, and Commerce Secretary Wilbur Ross constituted improper ex parte communications that warrant reversing the PTAB’s findings in favor of the patentee and, instead, either entering judgment in Apple’s favor or at least granting a new trial.

Boiled down, Apple argues that after the decision to institute was granted, the former CEO (and still “advisor” to the patentee) sent letters to the panel that had granted institution, and those letters were not made of record.  That panel was replaced, without explanation to Apple (or anyone from what I can tell), and a substitute panel then took over the matter.

The former CEO then sent more letters — to both the PTAB chief judge and to the substitute panel which, again, were not made of record. (It’s not clear to me that Apple or the patentee knew of the letters at this time.). Other letters to the chief judge, the substitute panel, and even the Secretary of Commerce followed and the letters were not made of record and Apple was not notified (and, again, neither was the patentee, from what I can tell).

Then on September 18, the patentee posted the letters — calling them “independent” — on its web page. Then there were more letters.

The substitute panel in late November in its final written decision and found Apple had not established the claims were unpatentable.

A month later, Apple filed this motion, stating the facts and asserting that its due process rights had been violated, and more.  Interestingly, Apple relies among other things, on the APA, arguing “the ex parte communications violate the APA, which prohibits an ‘interested person outside the agency’ from making, or knowingly causing to be made, an ex parte communication relevant to the merits of the proceeding with a member of the adjudicatory body.” (citing 5 U.S.C. § 557(d)(1)(A)).

Apple’s motion makes a few inferential leaps that, I think, undermine its credibility. For example, Apple spins the fact that the CEO said he had talked to the patentee’s lawyers into an assertion that the patentee’s lawyers knew of and helped the CEO write the letters — violating the cardinal rule that if you’re going to accuse someone of an ethical violation, don’t stretch.  (It may be the lawyers did assist: my point is, that’s not what the letters say.)

Apple also admitted that it had known that, in May, that the former CEO had sent a copy of one of his letters to the court handling the pending litigation involving the patent, because the clerk of that district court had entered the letter on the docket.  But, oddly, Apple said it had done nothing because it did not know the letter would influence the PTAB (again, inferring that the letter did influence the PTAB).  Further, apparently Apple knew of (what it now says is) an improper ex parte contact but did nothing — even though after it learned of that letter the panel was changed — and it only did something after it lost the IPR.

It will be interesting to learn why the PTAB judges did not inform everyone of the letters (assuming they even received them, and that disclosure did not occur), but it looks like Apple knew in May of (what it now says is) a clear ethics violation, but did nothing, and at least as of September, the patentee knew of (what are allegedly) the improper ex parte communications, and did nothing.

So, let’s see how this gets sorted out.

Claims that Defendant Infringed Patent Issued Years after Suit Filed Found Subject To Claim Preclusion

Normally, claim preclusion only bars later assertion of a claim only if (a) the plaintiff could have brought that claim when it filed an earlier suit and (b) the later-asserted claim is the “same” as a claim in the first case (courts take different approaches to how closely related the later claim must be to the first, but the federal rule is to look at whether the later-asserted claim arises out of the same operative facts as the earlier claim).  So, normally, if a patent issues to the plaintiff after the first suit is filed, claim preclusion wouldn’t apply because of the first step:  you can’t sue for infringement until the patent issues (with the narrow exception of seeking “provisional damages” for infringement under Section 154).

But, in a recent case, a district court held that the plaintiff had a “duty to seek to amend” its complaint to add a later-issued patent, and to the extent the defendant can show that its infringement arose out of the same set of facts as the earlier case, claim preclusion will (and does) apply. The case, XY, LLC v. Trans Ova Genetics, LC (D. Colo. 2018), is here.  One of the two patents issued after the complaint had been filed, and a second actually issued after judgment in the first case had been entered!  (The district court also took what may prove to be a very unworkable approach to determining the second step.)

So, be careful out there: this creates a real mess because now you’re going to have to assert every possible patent for infringement, and if a new one issues, you better move to amend and hope the judge grants the motion, or doesn’t, because then you’ll be starting all over again with discovery, claim differentiation issues, and so on…  If you’re a defendant, maybe you should consider seeking a declaration as to patents the plaintiff owns, but hasn’t asserted, and just make a mess that way.

Federal Circuit Reminds Us: “Will Assign” isn’t an Assignment

I love this case because it has lessons for ethics, drafting, and civil procedure.

The holding is pretty simple:  an inventor who signs an employment agreement that provides (a) she “will assign” rights to inventions doesn’t then assign them; (b) that she “holds in trust” those rights doesn’t mean she assigns them; and (c) that she “quit claims” those rights doesn’t mean she assigns them.  Two judges so held (O’Malley and Reyna), and Judge Newman dissented relying on the “intent” of the contract.  The case is Advanced Video Tech. LLC v. HTC Corp. (Fed. Cir. Jan. 11, 2018), here.

So, lesson for ethics and drafting:  verbs matter and due diligence matters! (Related note: watch out for spouses of inventors — there’s an argument in community property states that spouses own inventions that I’ve blogged about somewhere and which almost worked in one CAFC case, where the accused infringer was able to get a license from an ex-spouse!)

The civil procedure issue concerns Judge O’Malley’s concurring opinion. She argues that a co-owner who refuses to join is an indispensable party under Rule 19, and that a prior panel decision holding otherwise was wrongly decided, but binding.  I very much enjoyed working with Judge O’Malley (I clerked for then-CJ Rader a couple years ago), and she’s a civ pro wiz, but I have some doubts on that interpretation of Rule 19.  The examples of when someone is an indispensable party are few, and forcing someone to be a plaintiff in a patent suit when they don’t want to be subjects them to all sorts of potential liability (285, for example) that they may not want to incur.

Moreover, even if an en banc court agrees with her, I’m not sure it will eliminate every problem of the recalcitrant co-owner. For example, in this case, suppose the court en banc decides Judge O’Malley is right and Rule 19 requires joinder, and that the co-owner can be joined (i.e., there is personal jurisdiction over her and, arguably, venue is proper (Rule 19 is very weird)). As a result, the co-owner is joined involuntarily but then pleads:  “the defendant doesn’t infringe.”  Now there is no case or controversy between that co-owner and the defendant, and so no subject matter jurisdiction.  “Claim” dismissed?

I wonder if there’s a Rule 14 way to bring in a co-owner if there is a counterclaim for, say, inequitable conduct by that co-owner/inventor?  I teach and have written a book on civil procedure and that might work, but I’m not sure Rule 19 will.  I bet we will see an effort to use it.

My Recent Article on the Need for Speed in Patenting

I don’t like writing long law review articles any more, but I was persuaded to by the kids at Vanderbilt, and then they made me make it even longer by forcing me to explain things that we all know: patents ain’t what they used to be.

And, in doing it, I learned a lot.  The article — here — with the brilliant title of Will Patenting Make As Much Sense in the New Regime of Weakened Patent Rights and Shorter Product Life Cycles, and featuring some 294 footnotes — describes those changes (by the Supreme Court, Congress, and even the states), the changes in technological speed (and 3D printing) and what that means for the utility of getting a patent, and then talks about ways to speed prosecution and/or obtain damages before issuance. The abstract eloquently states:

After its founding in 1982, the US Court of Appeals for the Federal Circuit strengthened patent protection. During that time, businesses—which acquire 90 percent of all patents—increasingly applied for and enforced patents. Clearly, the benefit of having a patent outweighed the cost of doing so.

This Article shows that a central benefit of applying for a patent is that it permits its owner to exclude others from making the patented invention. A patent owner can use the coercive power of a patent to exclude others from making the invention, or to permit others to make the patented invention, but only if they pay money to do so. Two forces have reduced the power of that benefit.

First, patent rights have been weakened through changes in the law. The US Supreme Court has, almost without exception, reversed decisions of the Federal Circuit and adopted an approach that is less favorable to patent owners. Compared to today, in the year 2000, more inventions were eligible for patenting, more inventions were not obvious, more claims were definite, “equivalents” more likely infringed, infringement included more overseas conduct, patent rights were less easily exhausted, patentees could subject defendants to suits in districts more favorable to them, a losing patentee would almost never pay attorneys’ fees, and an injunction was the general rule that benefited a successful patent infringement plaintiff. More recently, Congress created administrative proceedings in the US Patent and Trademark Office that made it easier to challenge existing patents. In litigation, because of the statutory presumption of validity, patent claims are construed narrowly and, when possible, to avoid invalidity, and invalidity must be shown by clear and convincing evidence. In these new proceedings, the presumption does not apply, patent claims are construed more broadly, and only preponderant evidence is required to challenge a claim. Further, if a patent owner sues in court, courts will often stay the litigation in favor of allowing the Patent Office proceeding to finish. This effectively eliminates the presumption of validity. Other changes including heightened pleading requirements and state statutes also reduce the coercive benefit that patents confer.

After examining the available data as to whether these legal changes have already significantly altered the incentive to patent, the Article turns to the second force that reduces the benefit of the coercive power of patents: the fact that a greater number of products have shorter life cycles. Because patents take twenty-four months to issue, and the coercive power of a patent can only be utilized once it issues, the pace of change means that fewer patents will exist in time for their coercive power to be meaningfully applied. Further, that rapid pace of innovation has already created 3D printing, a technology that permits rapid and dispersed copying of new products, which further reduces the coercive benefit of patent rights.

This Article concludes by providing practical advice to patent practitioners as to how to manage the impact of these two forces. These include using established procedures to speed up prosecution, using claim drafting techniques that may help address 3D printing, and considering alternatives such as trade secret protection in lieu of patenting.


Thinking Ahead: Join Owners of Patent Owner for 285 Liability?

You get sued and you’re thinking you’ll ultimately win big.  Exceptional case.  Fees shifted.  And you do, and you get an award of $3 million in your favor.  But, the patentee is basically a shell and so after a year of trying, you decide to go after its owners, allegedly its alter ego.

Federal courts have power to assist in executing judgments, but state law must authorize the procedures used, and not all states allow for joinder of non-parties after final judgment.  In Vehicle Interface Tech., LLC v. Jaguar Land Rover North Am., LLC (D. Del. Dec. 14, 2017), the court held that the defendant failed to show that Delaware law permitted joinder under those circumstances, and so the $3 million judgment seems, it seems, worthless.  The case is here.

So, although it seems weird, perhaps you need to join owners of patent owners….

New ABA Opinion of Particular Interest

A lawyer may be adverse to a former client, but not in the same matter in which she represented the client, or in one which is “substantially related” to the representation of the former client.  Generally, this requires determining whether it is reasonably likely that in the representation, the lawyer likely learned confidential information that likely can be used against the former client now.

One part of that analysis can require determining what information “counts.”  This varies by jurisdiction: some, for example, do not include information known to the new client, or “playbook” information (e.g., how a client approaches IPRs), and so on.  And, some do not count information if it has become “generally known.”

In the context of prosecution, for example, does the fact that an application has published mean it is “generally known” and so no longer counts?

The ABA just released an opinion on this point, ABA Formal Eth. Op. 479 (Dec. 15, 2017), here.   The abstract explains:

The “generally known” exception to the duty of former – client confidentiality is limited. It applies (1) only to the use, and not the disclosure or revelation, of former – client information; and (2) only if the information has become (a) widely recognized by members of the public in the relevant geographic area; or (b) widely recognized in the former client’s industry, profession, or trade. Information is not “generally known” simply because it has been discussed in open court, or is available in court records, in libraries, or in other public repositories of information.


Need 3 hours of Ethics CLE? (Self-promotion warning).

I do a lot of speaking on ethics, mostly on ethical issues in patent prosecution and litigation.  I’ve worked with for decades now (they were I think the first on-line provider), and I put together what I think is a cool presentation on the impact of technology on practice.  You can take it here.  (California, Texas, and perhaps other states are pre-aproved but read the fine print.)

Their ad is below…  (My article about how innovation affects patenting is coming out soon, they say, all 294 footnotes of it.)

** available on demand any time of day and in time increments convenient to you ** is pleased to present a special online legal ethics program in which Professor David Hricikaddresses the myriad of practical ways that technology creates ethical issues for practicing lawyers. Professor Hricik discusses both the potential major trends — artificial intelligence changing daily legal practice, and technological developments like driverless cars potentially reducing car accidents which could affect entire practice areas — as well as the more immediate concerns. The latter includes the risks of communicating with clients while they are at work, inadvertent transmission of email, metadata (“hidden” confidential information in things like Word documents), cloud storage, and dealing with negative on-line reviews. This presentation mixes humor, fear, and practical tips to give 3 solid hours of Legal Ethics that matter and are immediately relevant to your law practice. The course features streaming video and audio (as well as downloadable MP3 audio) presentations.

Some of the subjects for this course include:

  • Exponential Change and Impact
  • A Future Full of Legal Disruption?
  • What Will Ethically, Successful Lawyering Require?
  • Hackers, Passwords, and Lawful v. Unlawful Interception
  • Invisible Confidential Information: “Metadata” and Related Issues
  • Confidentiality: How Many Vulnerabilities?
  • Due Diligence and Cloud Storage
  • Responding to Unhappy Clients
  • Litigation-Specific Technology Ethics
  • Evidence Everywhere … Wearable Devices
  • Social Media: Practical Tips and Pitfalls
  • The Law You Really Must be Prepared for Will Happen Before It’s Written About

*** Course Link ***

The speaker for this course is Professor David Hricik, of Mercer University School of Law in Macon, Georgia. Professor Hricik was elected to the American Law Institute in 2016. He has authored the only treatise on ethical issues in patent litigation, and co-authored the only treatise on ethical issues in patent prosecution. In addition to serving leadership positions on ethics committees with the AIPLA and ABA and serving as an expert witness, he has written dozens of articles and given well over 100 presentations on issues at the intersection of ethics and patents. His articles and testimony have been adopted by both state and federal courts.
This course is approved for credit by the MCLE Committees of the STATE BAR OF TEXAS and the STATE BAR OF CALIFORNIA (MCLE Provider #8648). These are not self-study credits, but rather ‘participatory’ credits as you would receive for attending a traditional, live CLE seminar.

In addition, regular CLE credits for this seminar may also be available in a number of other states through CLE Reciprocity, such as FLORIDA, or as an “Approved Jurisdiction”, such as TENNESSEE.  Please check with the Tennessee State Bar for accreditation information.

Technology and Ethics: Lex Machina

So, I signed up for training on Lex Machina for its public interest use. I was thrilled  They set up a conference call to train me and a bunch of other people. Free access for research purposes, but you have to go through the training (it looked pretty simple).

Someone signed on, but is (literally now) having a call with, I think a client, broadcasting this conversation on the training session.  Not only that, they had the training call muted, so this person couldn’t hear the poor trainer trying to get his attention to stop broadcasting confidential information.  She cancelled the call as a result, perhaps saving this fool from a disciplinary violation.

Just thought I’d share a reminder that we all should recall from Donald Trump and open mics.


Interesting Legal Malpractice Claim Based on Failure to Assert Exceptional Case

The facts of the case are sparsely set out in the appellate court decision in Smith, Gambrell & Russell, LLP v. Telecomm. Sys., Inc., 63 N.Y.S.2d 384 (N.Y. Sup. Ct. App. Div. Nov. 14, 2017), but are set out in more detail in the trial court’s decision, here.

Apparently, the firm represented the patentee, and won at trial.  It did not argue fees should be shifted under 285 (after Octane), but instead filed a motion for sanctions arguing inherent power. (That, of course, is a much more difficult hurdle than 285.)

The firm sued for fees owed, and the patentee counterclaimed, asserting the firm had missed the deadline for filing the motion, which is the later of 14 days after judgment is entered or post-judgment motions are resolved.  The evidence showed, however, that the motion had been filed within the latter time limit, but it was never ruled on (the underlying patent case settled).  Accordingly, the counterclaim for malpractice was dismissed.

The appellate court affirmed but also addressed an alternative argument made for the first time on appeal, which was that instead of filing for sanctions, the lawyers should have relied on 285 and Octane.  The appellate court stated that choosing inherent power over 285 was a judgment call, and so was not actionable, and also stated that the complaint failed to allege facts that showed the case was exceptional. (You would think those would be in the motion for sanctions that was filed.)

Interesting case for a couple of reasons: (1) if you sue for fees you likely will face a counterclaim for malpractice (it’s not always but it is often); and (2) remember that because of Gunn v. Minton, malpractice cases based upon mishandled patent litigation or prosecution will be decided by state courts. I’ve testified in state courts on patent matters and it is a different world out there.

USPTO Adopts Rule Adopting Patent Agent-Client Privilege

The adoption of the final rule, which relates to admissibility in post-grant proceedings, is here, and the substance is:

§ 42.57 Privilege for patent practitioners.

(a) Privileged communications. A communication between a client and a USPTO patent practitioner or a foreign jurisdiction patent practitioner that is reasonably necessary and incident to the scope of the practitioner’s authority shall receive the same protections of privilege under Federal law as if that communication were between a client and an attorney authorized to practice in the United States, including all limitations and exceptions.

(b) Definitions. The term ‘‘USPTO patent practitioner’’ means a person who has fulfilled the requirements to practice patent matters before the United States Patent and Trademark Office under § 11.7 of this chapter. ‘‘Foreign jurisdiction patent practitioner’’ means a person who is authorized to provide legal advice on patent matters in a foreign jurisdiction, provided that the jurisdiction establishes professional qualifications and the practitioner satisfies them. For foreign jurisdiction practitioners, this rule applies regardless of whether that jurisdiction provides privilege or an equivalent under its laws.

(c) Scope of coverage. USPTO patent practitioners and foreign jurisdiction patent practitioners shall receive the same treatment as attorneys on all issues affecting privilege or waiver, such as communications with employees or assistants of the practitioner and communications between multiple practitioners.

In-House Lawyer Fired for Complaining that Application Filing Quota Caused Ethics Violation Able to Sue

The Third Circuit reversed the grant of the dismissal of a lawsuit by in-house counsel who sued because, he alleged, he was forced to choose between complying with an application filing quota or complying with his ethical obligations to the USPTO.  The case, Trzaska v. L’Oreal USA, INc., (3rd Cir. July 25, 2017), is here.

The claim was based upon New Jersey’s whistle blower statute, the New Jersey Conscientious Employee Protection Act (“CEPA”), N.J. Stat. Ann. § 34:19-1 et seq.  The complaint alleged that complying with the quota meant filing “frivolous” patent applications.  In a two-one panel decision, the Third Circuit held the complaint stated a claim.