Guest post by Maxwell Goss. Dr. Goss is a business litigator with Rossman Saxe, P.C. in Troy, Michigan. His practice focuses on non-compete, trade secret, intellectual property, and shareholder law and litigation. Dr. Goss blogs at Law and the Creative Economy.

Last week I wrote about the doctrine of “inevitable disclosure” as it relates to the Defend Trade Secrets Act of 2016 (DTSA), the statute that created a general, private cause of action for trade secret misappropriation under federal law. Because inevitable disclosure is of continuing importance and controversy, I wanted to unpack the issues further here. As discussed below, the DTSA leaves room for trade secret plaintiffs to assert inevitable disclosure.

Trade secret plaintiffs frequently face problems of proof. Gathering evidence that a suspected individual or company has actually misappropriated trade secrets, or legitimately threatens to misappropriate trade secrets, can be a substantial hurdle to getting a lawsuit off the ground.

Take a typical scenario where an employee of company A goes to work for company B, and A alleges that the employee is using its trade secrets on behalf of B. In some cases, company A will have evidence that the employee swiped its secrets before leaving, perhaps by emailing himself a customer list or downloading technical specifications onto a flash drive. Company A might even have evidence that company B is now using the secrets, perhaps because it is soliciting A’s customers or has launched a product based on A’s specifications. In many cases, though, the activities of the employee and the new employer are a black box. The employee was exposed to trade secrets at Company A, and is now working for Company B, but Company A has not uncovered evidence of specific disclosures to Company B. Company A may have reason to believe the employee must be disclosing secrets to B, or threatens to do so, but has no way to confirm this directly prior to filing suit and obtaining discovery—a catch-22. Is company A without recourse?

Enter the “inevitable disclosure” doctrine. Under this common-law doctrine, a trade secret plaintiff may base a claim for trade secret misappropriation on a showing that disclosure of trade secrets is “inevitable.” In PepsiCo, Inc. v. Redmond, the landmark Seventh Circuit case on inevitable disclosure, a former employee of PepsiCo went to work for a competing beverage company. Notably, there was no allegation that the employee had stolen specific information and given it to the competitor. Instead, PepsiCo argued that the employee could not help but use the company’s trade secrets to help its competitor “achieve a substantial advantage” and “respond strategically” through his knowledge of PepsiCo’s pricing, distribution, and marketing information. Because his reliance on such information was inevitable, the court affirmed an injunction barring the former employee from assuming his position at the competitor company.

The doctrine of inevitable disclosure is controversial, and is only recognized in some jurisdictions. One objection is that it essentially allows courts to impose a non-compete on those who never signed a non-compete agreement. Another objection is that it facilitates abusive lawsuits against former employees based on flimsy evidence. Yet another objection is that it can enable a company to obtain an injunction that damages a competitor without any evidence of wrongful conduct by the competitor itself. Unsurprisingly, then, inevitable disclosure was frequently discussed in the lead-up to the passage of the Defend Trade Secrets Act. As enacted, the DTSA did ultimately limit the application of the doctrine. Though the language of the DTSA largely tracks that of the Uniform Trade Secrets Act (UTSA), which has been enacted in some form in nearly all states, the DTSA departs from the UTSA in that it expressly disallows injunctions that “prevent a person from entering into an employment relationship” and prohibits any conditions placed on a person’s employment in an injunction based “merely on the information the person knows.”

In light of this language, many observers have concluded that inevitable disclosure is a dead letter under the DTSA. For example, one article states that the DTSA “explicitly rejects the inevitable disclosure doctrine under federal law.” To take another example, I recently attended a (very good) presentation in which it was stated that inevitable disclosure is “foreclosed” by the DTSA. And I would be remiss not to mention that I myself declared in a CLE presentation last year that “[t]he DTSA seemingly rejects inevitable disclosure by dictating that conditions on employment in an injunction may not be based merely on information the person knows.”

But the doctrine of inevitable disclosure lives on under the DTSA, albeit in a diminished form. As explained in my previous post, the court in Molon Motor and Coil Corp. v. Nidec Motor Corp. recently held that a plaintiff had successfully stated a claim for trade secret misappropriation under the DTSA where it had pled allegations supporting an inference that a former employee who went to work for a direct competitor would inevitably have disclosed the plaintiff’s trade secrets to the competitor during the period in which the DTSA has been in effect. The court added: “Of course, further discovery could upend any or all of this, but at this stage, continued use beyond the May 2016 effective date [of the DTSA] is plausible.” Notably, the court then ordered the parties to discuss a “discovery plan on the trade secret claims.” In short, the plaintiff’s allegations of inevitable disclosure entitled it to move forward on both its federal and state trade secret claims.

It would be easy to dismiss Molon as dealing only with a narrow issue of limited importance. The Court’s principal concern, after all, was how the DTSA applies where the alleged theft at issue preceded its passage—an issue relevant in only a few and declining number of cases. But the ruling should not be dismissed so quickly. In reaching its holding, an essential part of the Court’s analysis was that was that inevitable disclosure can in fact support a DTSA claim. This conclusion has at least two potential implications applicable beyond the specific procedural posture of the case.

First, the DTSA could be used to secure jurisdiction in federal court and then state law could be used to secure an injunction based on inevitable disclosure. Consider companies A and B again. Company A wants to sue an employee of company B in federal court—for instance, because of perceived advantages in bringing the case before a federal judge or because of the streamlined process for obtaining discovery across state lines under the federal rules. But suppose the parties are citizens of the same state. Prior to passage of the DTSA, unless there had been some hook other than diversity jurisdiction for bringing the case in federal court, company A would have been forced to bring the case in state court. Under the DTSA, diversity of citizenship does not matter. Company A can bring the case in federal court regardless of the parties’ citizenship.

If company A goes this route, is it stuck with the DTSA’s strict limitations on injunctive relief, including the prohibition of injunction based “merely on the information the person knows”? Very arguably not. By its own terms, the DTSA does not preempt state trade secret law, and state law claims will nearly always be available in cases where the DTSA applies. Assuming the applicable state law permits injunctive relief based on inevitable disclosure, company A could file a concurrent claim for trade secret misappropriation under state law and obtain an injunction based on an inevitable disclosure theory. In such a case, the DTSA would be used to obtain federal court jurisdiction while state law would be used to obtain the desired relief.

Second, the DTSA stops well short of barring all injunctive relief based on inevitable disclosure. The limitations on injunctions under the statute apparently extend only to employment relationships: An injunction may not “prevent a person from entering into an employment relationship,” and any conditions on employment must be based on “evidence of threatened misappropriation and not merely on the information the person knows.” This suggests that an injunction that does not impact employment may still be based on inevitable disclosure.

For example, if company A can offer evidence that an employee who departed for company B will inevitably disclose A’s trade secrets to B, a court conceivably might grant an injunction prohibiting B from using or disclosing A’s trade secrets. For companies that believe their trade secrets are being misused but cannot get into the “black box” of the competitor’s activities prior to discovery, this could be a major advantage. More controversially, a court could grant an injunction directly against the employee based on inevitable disclosure, provided the injunction does not prevent the employee from working for company B or impose conditions on his or her employment.

If the Molon opinion is any indication, the DTSA giveth but the DTSA does not taketh away. That is, a trade secret owner can use the DTSA to bring its case in federal court, and can avail itself of the distinctive benefits and relief available under the DTSA, without losing its ability to assert inevitable disclosure in jurisdictions recognizing the doctrine under state law. Of course, it is unknown how other courts would address similar issues. (As far as I can determine, while a few opinions have made passing reference to inevitable disclosure in DTSA cases, Molon is the first to directly address the applicability of the doctrine under the DTSA.) At a minimum, though, the opinion indicates that rumors of the demise of inevitable disclosure are greatly exaggerated.

Introduction

Trade secrets are important to cybersecurity because many data breaches involve trade secret theft.  The Defend Trade Secrets Act of 2016 (DTSA) amended the Espionage Act of 1996 to provide a federal private right of action for trade secret misappropriation.   Some commentators opposed the DTSA in part because it seems redundant in light of state trade secret law and could lead to unnecessary litigation and restrictions on innovation.  Now that the DTSA has been in effect for nearly a year, I conducted an empirical study of cases asserting DTSA claims (with the able help of my research assistant, Zach Hansen).  This post summarizes the results of that study.

Methodology

We ran keyword searches in the Bloomberg Law federal docket database to identify cases asserting DTSA claims in federal courts.  It is not possible to search only on the Civil Cover Sheet because there is no discrete code for DTSA claims.  Our search ran from the effective date of the DTSA (May 26, 2016) through April 21, 2017 (just prior to our symposium on the DTSA at Seton Hall Law School).  After de-duping, we identified 280 unique Complaints, which we coded for a variety of descriptive information.  Our raw data is available online.

Findings

This chart shows the number of filings by district:

We were not surprised to see that the Northern and Central Districts of California, Southern District of New York, or District of Massachusetts were among the top five.  We were surprised, however, to see the Northern District of Illinois tied for first.  This could reflect the influence of the financial services industry in Chicago, but further research is required.

The next chart shows the number of filings by month:

It is interesting to note the decline in filings following the initial uptick after the May 26, 2016 effective date.  Perhaps this reflects a slight lull during the summer months.  Filings then remained relatively steady until March, 2017, when they increased significantly.  This could have something to do with the quarterly business cycle or bonus season, since many of the cases (as discussed below) involve employment issues.  Or, it could reflect a random variation given the relatively small sample size.

We next examined other claims filed along with the DTSA counts in these Complaints:

We excluded from this chart related state law trade secret claims.  Not surprisingly, nearly all the cases included claims for breach of contract.  As noted above, trade secret claims often arise in the employment context in connection with allegations of breach of a confidentiality agreement or covenant not to compete.  Another finding of note was that a fair number of cases assert Computer Fraud and Abuse Act claims, although the number is not as high as expected.  Most trade secret cases today involve exfiltration of electronic information, but perhaps many cases do not involve hacking or other access techniques that could run afoul of the CFAA.

We also noted a smaller but not insignificant number of cases asserting other intellectual property claims, including trademark, copyright and patent infringement.  Since many documents taken in alleged trade secret thefts are subject to other forms of intellectual property — particularly copyright — this may show that some lawyers are catching on to the benefit of asserting such claims along with DTSA claims.

Finally, our review of case status revealed the following:

• 198 cases in various pre-trial stages
• 61 cases dismissed
• 5 preliminary injunctions
• 4 final judgments, including 2 permanent injunctions
• 3 default judgments
• 1 case sent to compulsory arbitration
• 8 undetermined / miscellaneous

At first blush, the number of cases dismissed seems high, given that none of the cases have been pending for more than a year.  We assume the vast majority of these cases settled, though further investigation is required.  In contrast, the number of preliminary injunctions granted seems very low.  Again, further investigation is required, but so far it does not seem that the DTSA is resulting in the kind of preliminary injunction practice we expected to see under a federal trade secret statute.

Guest post by Maxwell Goss.  Dr. Goss is a business litigator with Rossman Saxe, P.C. in Troy, Michigan. His practice focuses on non-compete, trade secret, intellectual property, and shareholder law and litigation.

The Defend Trade Secrets Act (DTSA) was enacted a year ago, on May 11, 2016. One of the most sweeping changes in intellectual property law in recent years, the statute creates a private cause of action for trade secret misappropriation under federal law.

For trade secret owners, the advantages of the DTSA include access to nationwide discovery and enhanced remedies such as ex parte seizure of property to prevent propagation of stolen trade secrets. For those accused of trade secret theft, the DTSA provides substantial protections including strict limitations on the injunctive relief available and entitlement to a hearing no later than seven days after a property seizure.

An open question has been the status of the controversial “inevitable disclosure” doctrine under the DTSA. Under state law in some jurisdictions, courts will enjoin a company’s former employee from working for a competitor if the company establishes that the employee would “inevitably” use its trade secrets in his or her new position. Trade secret owners like the doctrine of inevitable disclosure because actual misappropriation can be hard to prove. At the same time, the doctrine has been criticized as effectively allowing courts to impose a non-compete on someone who never signed a non-compete agreement.

How does inevitable disclosure fare under the DTSA? The statute provides that an injunction to prevent misappropriation may not “prevent a person from entering into an employment relationship,” and that any conditions placed on a person’s employment in an injunction must be based on “evidence of threatened misappropriation and not merely on the information the person knows.” In light of this language, some have concluded that the inevitable disclosure doctrine is a dead letter under the DTSA.

But a recent court opinion indicates otherwise. Interestingly, the opinion was issued on May 11, 2017, the one-year anniversary of the DTSA, by the United States District Court for the Northern District of Illinois, a federal court in the Seventh Circuit, where inevitable disclosure was first definitively recognized. In Molon Motor and Coil Corp. v. Nidec Motor Corp., the plaintiff, a maker of bespoke motors and gearmotors, sued a competitor after an employee who had allegedly downloaded the plaintiff’s designs and technical data went to work for the competitor.

The defendant moved to dismiss the case, arguing (among other things) that the DTSA did not apply because the alleged acts at issue occurred before the DTSA was enacted in May 2016. The court rejected this argument. Noting that the “key question is whether the inference of inevitable disclosure reasonably extends to continued use beyond the Act’s effective date,” the Court reasoned:

At least on the limited record—the Third Amended Complaint—the alleged trade secrets are not of the nature that would necessarily go stale in the course of a couple of years. A motor design, and the quality control data associated with it, plausibly would retain its trade secret value well into the future. If it is plausible that some of the alleged trade secrets maintain their value today, then it is also plausible that Nidec would be continuing to use them. Of course, further discovery could upend any or all of this, but at this stage, continued use beyond the May 2016 effective date is plausible.

In short, even though the plaintiff company’s former employee had allegedly downloaded the files and gone to work for the competitor before the DTSA went into effect, the court found it plausible that there was a “continuing use” of the information by the competitor after the statute went into effect. Based on this finding, the court allowed the plaintiff to go forward on its DTSA claim.

How does this ruling square with the DTSA, which requires that an injunction be based on “evidence of threatened misappropriation and not merely on the information the person knows”? Though the Molon opinion does not connect the dots, the answer, in part, seems to be that the opinion was addressing a motion to dismiss, not a motion for injunction. A court may not be able to enjoin someone based on inevitable disclosure under the DTSA, but this does not mean a plaintiff may not sue someone based on inevitable disclosure under the DTSA. That is, even where injunctive relief may not be available as an initial matter, a trade secret owner might nevertheless file a claim and move forward with discovery—which could ultimately turn up the evidence necessary to fully substantiate a claim.

Molon represents a significant development in the body of law unfolding under the DTSA. In jurisdictions where inevitable disclosure is recognized, the ruling could help trade secret owners get a case off the ground even where information obtainable in a pre-suit investigation is necessarily limited. On the other hand, defendants will be quick to point out that Molon does not alter the specific allegations needed to plead a trade secret claim premised on an inevitable disclosure theory. Moreover, where an injunction is sought, it should be emphasized that any conditions placed on employment under the statute must be based on evidence of threatened misappropriation and not merely information the person knows.

What the Defend Trade Secrets Act Means for Trade Secret Defendants

The 2016 Report included substantial information regarding the Trans-Pacific Partnership (TPP) and commitments “to protect IP and to combat counterfeiting, piracy, and other infringement, including trade secret theft.”

Newly released 2017 Report does not mention the now-scrapped TPP – however President Trump is expected to conduct an aggressive set of bilateral trade negotiations.  His nominee for USTR – Robert Lighthizer – is moving through Senate Confirmation and will likely be confirmed within the next few weeks.  A holdup for Lighthizer is that he has previously lobbied the U.S. Government on behalf of foreign companies and groups in his role as a lawyer at Skadden.  This situation is common for almost any top level American trade negotiator working in the private sector.

The key news each year is the “Watch List”

Priority Watch List: Algeria  Argentina  Chile  China  India  Indonesia  Kuwait  Russia  Thailand  Ukraine  Venezuela

Regular Watch List: Barbados  Bolivia  Brazil  Bulgaria  Canada  Colombia  Costa Rica  Dominican Republic  Ecuador  Egypt  Greece  Guatemala  Jamaica  Lebanon  Mexico  Pakistan  Peru  Romania  Switzerland  Turkey  Turkmenistan  Uzbekistan  Vietnam

Regarding China, the USTR writes:

China must enact new measures and policies that provide stronger and more effective protection for IP; allow market access for IP-intensive products, services, and technologies; and enhance the effectiveness of civil enforcement in Chinese courts.

Read the report: 2017Special301ReportFINAL

DTSA enforcement continues to primarily focus on charges against former employees who join a competitor.  In Santander Securities v. Gamche, 2017 WL 1208066 (E.D. Penn. April 2017), the case centers on Gary Gamche who left Santander and joined a competitor Citizens Securities as a financial advisor – taking with him a list of his clients.  Similarly, in Brand Energy v. Irex, the construction company claims its former employees stole its proprietary business information (target bids and potential customer information); joined competitor Irex; and began poaching business.  So far, there are only a few DTSA decisions. In Brand, the Pennsylvania District Court  recently denied the defendant’s 12(b)(6) motion to dismiss for failure to state a claim upon which relief may be granted – finding that the alleged use easily fits within very broad definition of misappropriation found in the new federal statute.

Although the DTSA is limited to post-enactment misappropriations, the court in Brand held that it can apply to “continuing misappropriation that occurs after the effective date.”   Following Adams Arms, LLC v. Unified Weapon Sys., Inc., 16–cv–1503, 2016 WL 5391394, at *5–7 (M.D. Fla. Sept. 27, 2016).

In addition to the DTSA claim, the court found that the RICO and CFAA claims had been appropriately pled.

CFAA (Computer Fraud and Abuse Act) is interesting in that it imposes liability on anyone who knowingly “accesses a … computer without authorization, or exceeds authorized access” of the computer.  Here, Brand’s theory is that of ‘indirect access.’ After leaving BRAND, the defendants convinced a current employee to access the database and provide information.  According to the judge here, the defendants can be seen as accessing the computer (albeit indirectly and non-electronically via the employee) without authorization.  The statutory justification for this outcome is the court’s conclusion that Congress could have particularly defined “access” as “personal access” or “direct access” but instead left the term broadly stated.

Brand Energy v. Irex.

Michelle Lee remains at the top as Director of the USPTO and Undersecretary of Commerce.  As one of the few political-appointee holdovers from the Obama administration, Lee’s position remains somewhat tenuous, but I expect that it will be solid for at least several months weeks.  One noticeable gap is that the Commerce Dep’t website still fails to indicate Dir. Lee’s position. [LINK]

Second-in-command is Anthony Scardino, Acting Deputy Director of the USPTO and Acting Deputy Under Secretary of Commerce for Intellectual Property.  One problem with this appointment is the statutory requirement that the Deputy Director be a member of the PTAB which requires “competent legal knowledge and scientific ability”, 35 U.S.C. 6, and also have “professional background and experience in patent or trademark law.” 35 U.S.C. 3.  My understanding of the Agency’s position is that these requirements only apply to actual Deputy Directors and not an “Acting Deputy Director.”  Dir. Lee apparently sees Scardino’s position as filling an important administrative roll, but there is no chance that he will be appointed to the position of Deputy Director.  In addition Scardino apparently will not be participating as a member of the PTAB.

[Updated to correct typo] Joe Matal has been quiet for the past few years, but is not now rising again and has been named the acting Chief of Staff of the U.S. Patent and Trademark Office – “principal policy advisor” to the Director.  For the past several years, Matal has worked as an Associate Solicitor in the USPTO’s Office of Solicitor.  Prior to that, he worked as counsel for Senators Jeff Sessions (R-AL) and Jon Kyl (R-AZ) and was a primary drafter of the Leahy-Smith America Invents Act.

Paul Rosenthal is now the Acting Chief Communications Officer – moving from his prior position as Deputy Chief that is now being filled by Paul Fucito.

Finally, Drew Hirshfeld and Mary Boney Denison remain as the respective Commissioners for Patents and Trademarks as do the directors of the regional offices, all of whom had ties to the Obama Administration but are also very well respected IP attorneys.

I’ll take this chance to give a big shout-out to Russ Slifer who joined the PTO in 2014 to join and was named Deputy Director by Michelle Lee the next year.  Russ stepped down in January.  Thank you for your service to the agency and the profession!

The statute requires the Deputy Director and Deputy Under Secretary of Commerce to be a person “who has a professional background and experience in patent or trademark law.”  35 USC 3(b).  Scardino’s professional background and experience in IP law appears to be wholly based upon his 7-years as Chief Financial Officer of the Agency.  Under the prior Peterlin precedent, Scardino’s experience is almost certainly sufficient.  See, Aharonian v. Gutierrez, 524 F. Supp. 2d 54, 55 (D.D.C. 2007):

[O]ne would expect Congress to speak in precise terms if it intended the courts to monitor the minimal qualifications for agency officers. Here, Congress has given only the broadest of instructions—that the Deputy Director should have “a professional background and experience in patent or trademark law.” 35 U.S.C. § 3(b). The statute is silent as to the content of those terms. Were the decision subjected to APA review, the Court—not Congress—would be the ultimate source of the standards by which the qualifications of Ms. Peterlin would be judged: Is a law degree necessary? Is it sufficient? Are law school courses in intellectual property a requirement? Is certification to practice before the USPTO? Is law firm experience? How many years? If Congress had intended the extraordinary situation in which judicial review would reach to the very qualifications of agency officers for their policymaking positions, its statute would not be drawn “in such broad terms that … there is no law to apply.” See Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 410, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971) (citation omitted).

Thus, although we have a very interesting question as to why Scardino was moved up rather than PTO Commissioner Drew Hirshfeld, the shift would be quite difficult to challenge in court.  Almost certainly, this leapfrogging came about with substantial input from the Trump Administration.  That result leads me to the potentially disturbing potential that the next appointed PTO leaders will also sidestep the requirements of “professional background and experience in patent or trademark law.”

One difference between Scardino and Peterlin is that Peterlin is an attorney while Scardino is not (nor is he a patent agent).  This is relevant because Scardino is also deemed a member of the Patent Trial and Appeal Board.  The statute requires, however, that those members “be persons of competent legal knowledge and scientific ability.” 35 U.S.C. 6.  Of course, his CPA background may assist with judging Covered Business Method (CBM) cases.   Note here – I think that the best interpretation of the statute is that while the Director and Deputy Director are both members of the Board, the competency requirement of Section 6 only applies to the appointed judges.

Key Points for Friday:

• Live Stream 8:25 am – 2:00 pm at this link: http://law.missouri.edu/faculty/cipe-symposium/
• We have not arranged CLE for the video stream, so folks wanting CLE will need to be here in person.

Speakers include Mark Halligan from FisherBroyles in Chicago; Peter Menell, Professor at University of California, Berkeley School of Law; Robin Effron,
Professor at Brooklyn Law School; Yvette Joy Liebesman, Professor at
Saint Louis University School of Law; Orly Lobel, Professor at
University of San Diego School of Law; and me (Crouch).

Some Background Reading:

• Menell, Peter S., Misconstruing Whistleblower Immunity Under the Defend Trade Secrets Act (January 3, 2017). UC Berkeley Public Law Research Paper No. 2893181. Available at SSRN: https://ssrn.com/abstract=2893181
• Effron, Robin, Trade Secrets, Extraterritoriality, and Jurisdiction (December 1, 2016). Wake Forest Law Review, Vol. 51, No. 6, 2016; Brooklyn Law School, Legal Studies Paper No. 475. Available at SSRN: https://ssrn.com/abstract=2896137
• Lobel, Orly, Enforceability TBD: From Status to Contract in Intellectual Property Law (June 2, 2016). Boston University Law Review, Vol. 96, 2016; San Diego Legal Studies Paper No. 16-217. Available at SSRN: https://ssrn.com/abstract=2788857
• Goldman, Eric, Ex Parte Seizures and the Defend Trade Secrets Act (November 30, 2015). Washington and Lee Law Review, Vol. 72, No. 284, 2015. Available at SSRN: https://ssrn.com/abstract=2697361
• Cannan, John, A (Mostly) Legislative History of the Defend Trade Secrets Act of 2016 (May 4, 2016). Available at SSRN: https://ssrn.com/abstract=2775390

According to a Politico squib report, both Rep. Darryl Issa and USPTO PR Director Paul Fucito have confirmed that Dir. Lee is “in charge” but it is unclear whether she is still USPTO Director.

Paul Fucito tells [Politico Reporter] Nancy that Lee has been signing the certificates since since Inauguration Day. That function by law is handled by the director, but Fucito declined to clarify Lee’s status at the agency.

[Politico Report]  I requested both confirmation and further comment from the USPTO and Department of Commerce and was provided with “no comment.”

Representative Issa is now the Congressman with the most direct influence and oversight of USPTO activities in his role as chair of the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet.   Also communicating with Politico, Issa indicated his support for Dir. Lee but suggested that she may be transitioned into another administration role outside of the USPTO – such as trade negotiations or as a member of the Office of Science and Technology Policy.  Thus, we may still have a new USPTO director this spring.

We will not begin to see action until a Commerce Secretary (likely Mr. Ross) is confirmed and puts in place his pick for PTO Director.  This will likely happen next week.

For anyone pushing patent reform this term – either at the PTO or in the courts, you should recognize that all roads lead through Rep. Issa – nothing will go forward without his direct support.

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