Nisus Corp. v. Perma-Chink Sys. v. Michael Teschner (Fed. Cir. 2007).
Nisus Corp’s patent relates to a method of putting Boron in a tree to kill termites and prevent forest fires. After a bench trial, the patent was found unenforceable due to inequitable conduct. Apparently, Nisus had failed to disclose material documents from a prior lawsuit involving closely related patents. The court specifically mentioned Nisus’s former patent attorney, Michael Teschner, as one cause of the inequitable conduct.
Teschner sued to intervene in the case and clear his name, but the district court denied him the opportunity. On appeal, the CAFC likewise found Teschner without standing.
Appeal by Nonparty: Usually, a nonparty has no standing to appeal. However, an attorney that is formally reprimanded may appeal to the CAFC. However, other (informal) “judicial criticisms of lawyers’ actions are not reviewable.” The court’s comments regarding Teschner here do not rise to a formal reprimand, and thus offer no standing for appeal.
To allow appeals by attorneys, or others concerned about their professional or public reputations, merely because a court criticized them or characterized their conduct in an unfavorable way would invite an appeal by any nonparty who feels aggrieved by some critical statement made by the court in an opinion or from the bench. Treating such critical comments by a court as final decisions in collateral proceedings would not only stretch the concept of collateral proceedings into unrecognizable form, but would potentially result in a multiplicity of appeals from attorneys, witnesses, and others whose conduct may have been relevant to the court’s disposition of the case but who were not parties to the underlying dispute. Nor would it be appropriate to limit such appeals to attorneys, while forbidding others from appealing from critical court comments, as such a limitation would smack of special treatment for members of the bar and would be difficult to justify as a matter of principle.
Thus, a finding of inequitable conduct does not create any standing for an aggrieved prosecuting attorney to appeal.
Postscript: Mr. Teschner declined my offer for an interview, noting that the matter is still pending at the PTO. His lone statement is that he is “glad that the Federal Circuit found merit in [his] argument.”