Text of Patent Litigation Ethics 2014 By Gene Quinn, IPWathdog.com
Patent Litigation Ethics 2014 By Gene Quinn, IPWathdog.com
What I hope to cover in 1 Hour. Avoiding Ethical Traps The new PTO ethics rules The OED ethics process Cases and Decisions
How to Avoid Ethical Traps Remember what we were taught in law school. Dont lie Dont steal Dont cheat Dont sleep with your clients * Keep a client trust account for unearned fees! We should add. Dont give clients a reason to even suspect legal malpractice. Dont get sanctioned by a Court or Tribunal. Dont commit a crime (probably redundant but needs saying). Dont be stupid! Usually not a problem for patent practitioners, but potentially NOT an ethical violation under the new PTO Ethics Rules.
Malpractice Mistakes When you make mistakes your clients get unhappy clients and when clients get unhappy they sometimes complain and when unhappy clients sometimes complain they contact the Ethics Police and when unhappy clients contact the Ethics Police your life gets more complicated. Dont let your life get more complicated. Dont make mistakes!
New Ethics Rules 2012. USPTO finalizes Disciplinary Rules http://www.ipwatchdog.com/2012/07/30/uspto-issues-final-rules-of-discipline-for- patent-practitioners/id=26952/ AIA = 10 year statute of limitations A complaint must, however, be filed within 1 year from when the OED Director receives a grievance forming the basis of the complaint The USPTO and Practitioner may agree to tolling 1 year period to attempt to negotiate resolution.
In 2013 the USPTO adopted new Rules of Professional Conduct, based on the ABA Model Rules. The Office also revised the existing procedural rules governing disciplinary investigations and proceedings. These changes now provide practitioners with substantially uniform disciplinary rules across multiple jurisdictions. http://ipwatchdog.com/blog/FINAL-representation-of-others.pdf
Some Highlights 1.The Office removed this practitioner maintenance fee. 2.The definition of fraud or fraudulent used in the ABA Model Rules was not adopted. USPTO believes common law should apply. 3.Action or notice by OED Director is not a final agency decision under the Administrative Procedure Act; must exhaust administrative remedies before an appeal out of Office. 4.USPTO expressly has jurisdiction over a person not registered to practice before the Office if the person provides or offers to provide any legal services before the Office. 5.Section 11.106 relates to confidentiality of information. This section generally corresponds to ABA Model Rule 1.6, but it also includes exceptions in case of inequitable conduct before the Office. Interesting--- ABA Model rule 1.6(c) says: A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client. There is no PTO equivalent to 1.6(c). http://ipwatchdog.com/blog/FINAL-representation-of-others.pdf
More Highlights 6.RE: 11.106(c) and the duty of disclosure If a practitioner has a conflict of interest in a given matter, arising from a different client, timely withdrawal by the practitioner from the given matter would generally result in OED not seeking discipline for conflicts of interest under part 11. 7.Sexual relations with clients The PTO has declined to enact a rule that specifically addresses sexual relations between practitioners and clients. Because of the fiduciary duty to clients, combining a professional relationship with any intimate personal relationship may raise concerns about conflict of interest and impairment of the judgment of both practitioner and client. To the extent warranted, such conduct may be investigated under general provisions of the USPTO Rules. 8.If you know another practitioner has committed a violation that raises a substantial question as to that practitioners honesty, trustworthiness or fitness, you must inform the OED Director and any other appropriate professional authority. Similar rule with respect to Judges. http://ipwatchdog.com/blog/FINAL-representation-of-others.pdf
In the Matter of James B. Hicks (OED 9-30-2013) Available at http://e-foia.uspto.gov/Foia/ReterivePdf?system=OED&flNm=0749_DIS_2013-09-10http://e-foia.uspto.gov/Foia/ReterivePdf?system=OED&flNm=0749_DIS_2013-09-10 Hicks engaged in conduct prejudicial to the administration of justice. In Rates Technology v. Mediatrix Telecom the EDNY sanctioned Hicks for failing to comply with the discovery orders and imposted monetary sanctions in excess of $43,000 against Hicks. On appeal the Federal Circuit found that Hicks had made misleading and improper statements in the brief he submitted challenging the sanction levied against him.
Virginia Innovation Sciences v. Samsung Parties knew of IPR petition, but didnt inform the Court for six months. Counsel said it never occurred to them that they should advise the Court of the parallel proceeding even given presence of estoppel provisions. Court said this gave parties two bites at the apple regarding validity. The parties should have notified this Court of the IPR petition as soon as it was filed, and the failure to do so appears to have been a glaring omission. Given newness of IPR this admonition falls short of a formal reprimand. Future failure to disclose by any parties will be met with far sharper Consequences. future failures to disclose to the Court any concurrent inter p a r t e s review proceedings will be met with far sharper consequences. Eastern District of Virginia, Norfolk Division 2:12-cv-548 (5-2-2014)
Cyber Switching specifically asked for help to develop a plan to enforce these patents. Over the next two months, K&L Gates attorneys and Cyber Switching personnel engaged in face-to- face meetings and other privileged communications. Cyber Switching provided confidential information and work product analysis of the patents to K&L Gates, and K&L Gates provided advice. K&L Gates billed Cyber Switching for the time its attorneys spent on this matter, and Cyber Switching paid those bills. Californias conflicts rule tracks ABA Model Rule 1.9(a), which states: A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that persons interests are materially adverse to the interests of the former client unless the former client consents after consultation. Cyber Switching Patents v. Eaton Corp. Northern District of California, Oakland Division 4:14-cv-02682-PJH
K&L Gates argued that Cyber Switching never retained the firm in any matter that would give rise to a disabling conflict, and never provided K&L Gates with any confidential information that could be used during this litigation. Notwithstanding, K&L Gates did establish an ethical wall between the attorneys contacted by Cyber Switching regarding a non-conflicting engagement and the K&L Gates attorneys of record in this litigation. Nevertheless, K&L Gates withdrew out of an abundance of caution, explaining that it would be fundamentally unfair to subject Eaton to a protracted distraction on this issue that is unrelated to the merits of the case Cyber Switching Patents v. Eaton Corp. Northern District of California, Oakland Division 4:14-cv-02682-PJH (9-29-14)
An attorney who multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses and attorneys fees reasonably incurred because of such conduct. See 28 U.S.C. 1927. The Court also has the inherent power to sanction a lawyer for a full range of litigation abuses including for acting vexatiously. [ ] In this case, Escorts counsel represented that ESC17363 operated Escorts accused devices knowing that ESC17363 did not operate any accused device. This false representation was beyond reckless and was made in bad faith because Escorts counsel knew it was not true. The Court will therefore award attorney fees as sanctions under both 1927 and the Courts inherent power. Cyber Switching Patents v. Eaton Corp. U.S. District Court for the District of Idaho, 1:12-CV-066-BLW (9-29-2014)
Defendants alleged that LBDS manufactured and falsified evidence, testified falsely, and committed a fraud upon the Court. Akin Gump immediately forwarded the Motion to representatives of LBDS, who eventually admitted the allegations were essentially correct. Akin Gump attorneys explained that if LBDS did not promptly admit the allegations to the Court, Akin Gump would do so in accordance with the Texas Rules of Professional Conduct. Further, LBDS was notified that Akin Gump could not continue representation. Akin Gump ultimately disclosed the deception to the Court. LBDS Holding Co. v. ISOL Technology Eastern District of Texas, Tyler Division 6:11-cv-00428-LED (5-21-2014)
Akin Gump did not have any reason to question the authenticity of the documents and did not know that any of the testimony offered was untrue. Revealing of confidential client information was not only within the rules, but mandated. (A lawyer shall reveal confidential information if the lawyer comes to know that he/she has offered m