Finnegan Sued for Malpractice

July 9, 2017

In today’s world, patents are often owned by corporations or by groups of corporations. Inventors form companies with investors, or assign shares to investors, and these are considered separate legal entities.

Despite the legal niceties of firms of Attorneys representing companies, in practice Attorneys form connections with real persons who are sometimes the inventor, sometimes the head of R&D and sometimes the CEO or CTO. Often the patent attorney is not fully informed of the corporate structure. Structure itself is a misnomer. It implies something with a plan and a logic. Typically with solid foundations.

When receiving instructions from an inventor, receiving payment from a company and having a POA with another company, it is possible for the attorney to act in accordance with instructions from someone who is not the legal owner of an asset, and to find him or herself with a conflict of interest. Sometimes these are legal niceties that are over-looked. Sometimes they blow up.

Michael Kildavaeld conceived of a razor utility knife with a graphite pencil blade.  The “marking blade” invention marks surfaces with far greater precision than a standard carpenter’s pencil.

In October 2012, Kildavaeld met Robert Cumings, who allegedly had extensive experience in the marketing and manufacturing of tools.  That same month, Cumings introduced Kildavaeld to Harry Billado, who allegedly had experience in patent prosecution, licensing of patents, and bringing inventions to market. Together they formed a Delaware company called  “Contractor Trusted LLC”. In March 2013, Contractor Trusted LLC hired Finnegan Henderson to obtain patent protection on the marking blade invention.  Attached to the complaint is an engagement agreement between Finnegan Henderson and “Contractor Trusted, LLC c/o Mr. Michael Kildavaeld.”

The complaint alleges that Contractor Trusted LLC, marketing as Accutrax LLC began marketing its product to Stanley Black and Decker.  According to the complaint, in October 2014, while Stanley was negotiating with “the LLC” for a master purchase agreement, Kildavaeld individually contacted Stanley and tried to negotiate his own exclusive relationship with Stanley that eliminated Accutrax LLC from the picture.

According to the complaint, Stanley decided to back out of the deal rather than get caught in between the two sides who were in the midst of a patent ownership dispute. On December 23, 2014, the USPTO issued Patent No. 8,915,662.  No assignee was identified on the face of the ’662 Patent.

According to the complaint, the “patent for the Marking Blade” was issued “to Kildavaeld.”  Stanley Black and Decker withdrew from negotiations due to a dispute over who owned the patent.

“Contractor Trusted LLC” (Accutrax) has sued Finnegan for what it considers was acting in favour of the inventor and adverse to its interest, alleging claims against Finnegan for legal malpractice (count 1), breach of fiduciary duty (count 2), breach of contract (count 3), and aiding and abetting the commission of torts and breach of fiduciary duty (count 4). Accutrax seeks an unspecified amount of monetary damages.

The case is styled Accutrax LLC v. Finnegan, Henderson, Farabow, Garrett & Dunner LLP, Mass. Suffolk County Civil Superior Court, Case No. 1784CV01617.

For more details see here.


Cancellation Proceedings Against an Israel Patent for a Modular Support Bracket

April 6, 2017

Figs for ACMoshe Lavi registered Israel Patent No. 157035 titled “MODULAR SUPPORT BRACKET”. A competitor, Zach Oz Air Conditioning LTD and Zach Raz filed to have the patent cancelled on grounds of invalidity. They seem to have botched the attempt, but I think that this ruling is a poor one.

Background

In the past, Lavi has tried enforcing the patent against Zach Oz Air Conditioning LTD. (Back then, around 2004, I was engaged as an expert witness by Counsel of the Defence, Soroker Agmon. In my Expert Opinion, I argued what is known as ‘the Gilette Defense’ stating that the correct interpretation of the claims was much narrower than that which Lavi and his lawyers Pearl Cohen Zedek Latzer Bratz (Pearl-Cohen) was using and Zach Oz’ support bracket was not infringing. Furthermore, if one considered that Zach Oz’ brackets were within the ambit of the claims, the patent would not have issued in the light of the myriad of prior art shelf support brackets.  On the day of the trial, Lavi dropped the charges and Zach Oz agreed not to infringe the patent.

It was not the first time that Pearl-Cohen have tried to assert a patent against a competitor that was not infringing. They tried this in the US on behalf of Source Vagabond against Hydropak. In that instance, the New York District Court fined Pearl-Cohen and the lawyers actively handling the case $187,308.65. That ruling was then Appealed to and upheld by the Federal Circuit Court of Appeals).

Frustrated by repeated bullying by Moshe Lavi and Pearl-Cohen, Zach Oz filed a cancellation proceeding against the Israel patent. Confusingly, their Attorney is called Pearl. It is not Zeev Pearl, but another practitioner.

Pearl-Cohen submitted a rather ambitious attempt to have the case thrown out as Zach Oz had not argued invalidity when accused of infringing, and Pearl-Cohen argued that this was a sort of in absentia estoppel since they could have raised the argument back then, and didn’t. The Commissioner threw that argument out, and allowed the cancellation proceeding to proceed.

The cancellation proceeding has now run its course and the following article Read the rest of this entry »


Wet-wipes, The Issue of Inventorship and the Responsibilities of the Patent Attorney

September 22, 2016

wetnap-were-ready-for-any-messThis ruling concerns a product that resulting from the contributions of two people who were formerly friends. A patent application was filed that named both people as both inventors and applicants. Later, after powers-of-attorney signed by each of the named inventor – applicants had been filed, there was an attempt to ‘correct an office error’, to list one of them as an inventor only. The corresponding PCT application and the national phase entry applications, including two issued patents in the United States only bore the name of one inventor and applicant. In an Opposition ruling the Israel Patent Office has now accepted that the second named inventor is indeed an inventor and also an owner.

Apart from emphasizing the need to determine who is the inventor and who is the owner of an invention when the patent is filed, the need to put everything into writing, and the dangers of working with friends, the case raises interesting questions regarding what contribution to reducing a patent to practice entitles someone to recognition as an inventor and whether this standard is the same in all jurisdictions. It also raises interesting questions regarding the duties and responsibilities of the patent attorney to ascertain the facts, or at least to avoid signing on contradictory statements regarding ownership and invention in different jurisdictions.

BACKGROUND

IL 152867 titled “Tissue Container With Auxiliary Compartment”is a patent application for a package of wet-wipes
rc-chairswith an adjacent container for nappy cream. The Application was filed back in November 2002 and listed Boaz Krystal and Liat De-Vries as inventors and owners. The patent application was allowed at the end of June 2010.

Subsequently, an Opposition was filed by WET-NAPS LTD and Liat De-Vries on 4 October 2010 under Section 31(3) of the Israel Patent Law 1967 on the grounds that Boaz Krystal was not in fact an owner, and that the patent was exclusively owned by Ms Liat De-Vries.
affidavitsMr Boaz Krystal and his wife Mrs Dorit Krystal each submitted affidavits. Mrs Liat De-Vries submitted a primary affidavit and a supplementary one in response to Mr Boaz Krystal’s affidavit. Wet-Naps Ltd. is owned by Mr Ilan De-Vries, who is Mrs Liat De-Vries’ husband. He also submitted an affidavit on behalf of the company.  Mr David De-Vries, a patent attorney at Reinhold Cohn & Partners who drafted and filed the application and is a cousin of Mr Ilan De-Vries, Ms Ronit Tal who is an acquaintance of Liat De-Vries and Mr Yoram Hadar who is an industrial designer, also submitted affidavits. A hearing was held and the parties submitted their summaries.

wetnapWet-Nap Ltd manufactures, exports and markets wet-wipes. The company had a business relationship with Packtop Ltd., a company directed by Mr Boaz Krystal that distributes wet-wipes amongst other things.   At the time of filing, both the Krystals and the De-Vries couple were good friends.

roobarbs-shedThere is no argument that Mr Boaz Krystal and Mrs Liat De-Vries met at the Wet-Nap Ltd factory, where Mr Boaz Krystal heard the idea of including baby ointment together with a package of wet-wipes from Mrs Liat De-Vries. There is also no argument that Mr Boaz Krystal and Mrs Liat De-Vries had some kind of collaboration, to develop and improve this invention and to file a patent application for it. Eventually a joint application was filed in both Mr Boaz Krystal and Mrs Liat De-Vries names. However, the parties disagree regarding Mr Krystal’s contribution to the development of the invention and consequently disagree regarding whether he is to be considered an inventor and owner of the patent.

The Main Documents in the Prosecution File Wrapper

roobard-and-custard-friendsThe Application was filed in November 2002 by Reinhold Cohn Patent Attorneys. The Application form lists both Mr Boaz Krystal and Mrs Liat De-Vries as joint owners due to them being inventions. Both parties filed Powers of Attorney, and the Filing Certificate gives both names.

On 10 December 2002, Adv. David De-Vries of Reinhold Cohn Patent Attorneys submitted a notice stating:

office-error“Due to an office error, the name of the inventor, Mr Boaz Krystal was inserted as an Applicant. With our apologies for this, we are submitting a new cover sheet and application form in duplicate, listing Mr Boaz Krystal and Mrs Liat De-Vries as joint inventors, but Mrs Liat De-Vries as the sole owner.”

On 10 December 2002, Adv. Edna Haruti, now Mr Krystal’s representative, submitted a letter in which it was stated that Mr Krystal was a joint owner together with Mrs Liat De-Vries as he had invented the tissue container with auxiliary compartment together with her.  Adv. Edna Haruti also noted that registration of the patent in the name of Mrs Liat De-Vries only was contrary to the agreement between the parties.

shimon-shalitOn 2 February 2003 Patent Attorney Shimon Shalit, then Senior Examiner in charge of formalities at the Israel Patent Office, responded to both Reinhold Cohn and to Mr Krystal that Mr Krystal could not be removed as an owner in the application as filed, since there was no indication that he had assigned his invention to Mrs Liat De-Vries prior to the application being filed. In absence of such proof, since Mr Krystal was not an employee of Mrs De-Vries, by virtue of being a co-inventor, he was also a co-owner.

(As an aside – On 12 March 2006 Mrs De-Vries submitted a divisional application of IL 152867 for certain applications of the invention. This divisional application (IL 174309) was examined, allowed and issued as a patent. On 1 December 2010 IL 174309 lapsed due to failure to pay the renewal fees. That patent is not directly relevant to this Opposition, but Wet-Naps Ltd and Liat De-Vries related to it in their claims).

procrastinateIn the protocol of a hearing held on 5 February 2007 before then Deputy Commissioner Noah Smulevezh it was decided to defer the issue of ownership until the examination of the application was completed. It was further ruled that Reinhold Cohn would be address of record, but would update Mr Krystal or his representative regarding actions taken to get his input before responding to office actions. The patent application was eventually allowed and published for opposition purposes, resulting in this opposition proceeding.

The Opposers’ (Wet-Naps Ltd and Mrs Liat De-Vries) Main Claims
wetnap

Mrs De-Vries and Wet-Naps Ltd claimed to have thought of the idea and developed the invention whereas Mr Krystal had merely provided technical drawings and a business plan for commercializing the product. They alleged that during the period in question, Mr Krystal provided technical and consultancy services to the company as almost an in-house service provider and as such, was exposed to the invention. They further claimed that Mr Yoram Hadar (industrial designer) and Patent Attorney David De-Vries provided sketches for the product that eventually evolved into the patent application. They further alleged that Mr Krystal had suggested a specific implementation (embodiment?) – storing the cream in a blister pack or sachets, which developed into  Read the rest of this entry »


Reconsideration of a Patent Extension Term

August 10, 2016

last minute shopping

In an odd development, but not one that without precedent – see here and here – Dr Shlomo Cohen Law Offices has asked the Israel Patent Office to reconsider a judicial ruling.

In this instance, the original ruling relates to the Patent Term Extension (PTE) of IL 169693 to “Bristol Myers Squibb” and Pfizer that issued under section 64(v)5 of the Israel Patent Law. The original ruling issued in September 2015, and granted a patent term extension of 974 days until 18 May 2025. That ruling followed a challenge by the patentees to Examiner’s decision of 5 March 2015.

The way that Patent Term Extensions (PTEs) are calculated in Israel is detailed in Read the rest of this entry »


Michel Mercier Coexistence Agreement Refused by Israel Patent and Trademark Office

April 10, 2016

Michel Mercier 2

As previously reported, Campalock LTD (formerly Michel Mercier LTD) and Michel Mercier previously reached a coexistence agreement which was rejected by the Israel Patent Office who fined both parties for wasting the court’s time.

To recap, on 13 November 2011, Kampalook LTD (previously Michel Mercier LTD) filed a word mark application (IL 240628) for Michel Mercier in class 21. On 2 December, Michel Mercier filed Israel trademark no. 251414 in classes 3, 8, 11, 21, 35, 41 and 44. Since the identical mark was submitted by two different applicants, both in class 21, a competing marks procedure was initiated.

According to an Affidavit submitted by Mr Avshalom Hershkowitz, the Deputy CEO of the company, Mr Mercier is an entrepreneur and inventor in the field of hair care, who created both the brand that carries his name, and the company. The company owns the patents and designs for hair untangling equipment invented by Michel Mercier.

Over the years, differences of opinion between the company and Mr Mercier resulted in the parties requesting the court’s arbitration.

Following a negotiated settlement, the parties have now requested that the mark for the hair brushes remain the property of the company, but the same mark for hair cleansing and other treatments, and electronic and manual hair styling equipment, hairdressing services and schools remain the  property of Mr Mercier. However, this agreement was not presented to the Israel Patent and Trademark Office.

Now the companies request that both marks be allowed to register.

The parties stated their case and attempted to convince the Israel Patent and Trademark Office that parallel registration was allowable under Section 30.  The parties considered their case an exception that justified coexistence. The parties argued that they have been effectively coexisting for over a year without problems and without any customer complaints or confusion. Furthermore, in addition to the name Michel Mercier, the company’s products include the term “by Campalook”. Forbidding coexistence would make filing abroad difficult as the Madrid Protocol could not be used and the parties further noted that the USPTO had agreed to register the two marks.

Section 30 states as follows:

(a) Where it appears to the Registrar that there is current use in good faith, or where there are other special circumstances which in his opinion justify the registration of identical or similar trademarks in respect of the same goods or description of goods by more than one proprietor, the Registrar may permit such registration subject to such conditions and limitations, if any, as he may think fit. (Amendment No.7) 5770-2010 (b) A decision of the Registrar under subsection (a) shall be subject to an appeal to the Supreme Court; an appeal as aforesaid shall be filed within 30 days of the date of the Registrar’s decision; in the appeal, the Court shall have all the powers conferred upon the Registrar in subsection (a). (Amendment No. 7) 5770-2010 (c) The appellant shall give notice to the Registrar of the filing of an appeal under subsection (b) within 30 days from the date of its filing. (Amendment No. 7) 5770-2010 (d) In an appeal under subsection (b) the Court, if so required, shall hear the Registrar

The Equitable behaviour and desires of the parties themselves are necessary but not the only considerations. The parties wish to part company and have reached an agreement that the Patent Office is not party to. Since the Applicant was himself unhappy with the agreement at one stage, it went to arbitration. The parties now want the Patent Office to ratify the agreement, despite most details being obscure. Nevertheless, there is no indication of inequitable behaviour.

However, the Patent Office is also responsible to protect the public interest and coexistence agreements that mislead or confuse the public regarding the source of goods cannot be ratified. In this regard, the deputy commissioner referred to the Karl Storz vs. Bausch and Lamb decision from 2009, and to the biosensors ruling of the District Court.

In this instance, the two parties do not have an ongoing business arrangement, but the mark is the same and the goods and services are in the same class. Furthermore, Michel Marcier remains seen as the source of goods and the company has had to add their name to indicate otherwise. However, the addition of the company name is not part of the applied for mark and they could stop adding it. Furthermore, it does not imply a lack of relationship with Michel Mercier.  Since Michel Mercier is a real person who is active in the field, a reasonable consumer would assume an ongoing  relationship with him.

It is true that the USPTO allowed registration to both parties. However, with reference to the Trademark Manual of Examining Procedure,  it appears that the USPTO will allow different legal entities to register the same mark(s) if it considers that there is a connection between them:

Section 2(d) of the Trademark Act, 15 U.S.C. §1052(d), requires that the examining attorney refuse registration when an applicant’s mark, as applied to the specified goods or services, so resembles a registered mark as to be likely to cause confusion. In general, registration of confusingly similar marks to separate legal entities is barred by §2(d). See TMEP §§1207–1207.01(d)(xi). However, the Court of Appeals for the Federal Circuit has held that, where the applicant is related in ownership to a company that owns a registered mark that would otherwise give rise to a likelihood of confusion, the examining attorney must consider whether, in view of all the circumstances, use of the mark by the applicant is likely to confuse the public about the source of the applicant’s goods because of the resemblance of the applicant’s mark to the mark of the other company. The Court stated that:

The question is whether, despite the similarity of the marks and the goods on which they are used, the public is likely to be confused about the source of the hair straightening products carrying the trademark “WELLASTRATE.” In other words, is the public likely to believe that the source of the product is Wella U.S. rather than the German company or the Wella organization.

Therefore, in some limited circumstances, the close relationship between related companies will obviate any likelihood of confusion in the public mind because the related companies constitute a single source”.

In Israel Law, there is no similar clause that allows a connection between separate legal entities to be sufficient for them to be considered a single source. However, where companies are daughter companies of the same concern, under certain circumstances it may be possible to allow them to own confusingly similar marks (See Seligsohn 1973, Page 55).

This case is different. The Agreement between the parties is more of a divorce than anything else. It states the lack of connection between Michel Mercier and the company. It is not clear what was disclosed to the USPTO and their decision to allow the two marks to coexist has not been endorsed by a court. The decision is not sufficient to be relied upon as a comparative ruling of a foreign judiciary.

The lack of problems caused over the twelve months of coexistence de facto is also of limited value since it is not clear that the consumers purchasing the hairbrushes were aware that there was no ongoing connection with Michel Mercier. It does not seem that any attempt was made to poll the customers.

Furthermore, 12 months is a short period.  In the Biosensors ruling, Judge Schitzer  noted that in that case, the coexistence on which registration in parallel was requested was two years, but the cited case law related to very much longer periods.

Whilst it is true that the company  Campalock LTD owns the various patents and designs, that not necessarily mean that trademarks be considered in the same manner. The designs and patents may be the basis of the sold product range and can be bought and sold, but the name is the public face of the company and has to identify the source of the goods.

Certainly allowing the marks would facilitate international trademark registration by Campalock via Madrid, but traditional national registration remains an option and the ease of registration abroad via the Madrid Protocol is not a relevant consideration for the Israel Patent and Trademark Office to consider when ruling on whether to allow two competing marks to coexist.

 

 

 

 


Insufficient Evidence to Find Finnegan Guilty of Conflict of Interest

December 27, 2015

michaelfinnegan  Finnegan’s Wake here.

The Supreme Judicial Court of the State of Massachusetts has upheld a decision to dismiss claims against Finnegan, Henderson, Farabow, Garrett & Dunner, LLP (henceforth Finnegan) for conflict of interest. A copy of the opinion may be found here.

The Facts

Chris Maling hired patent prosecuting attorneys at Finnegan Henderson to prosecute a set of patent applications relating to screwless eyeglass hinges. According to Maling’s complaint, Finnegan was representing his competitor in the screwless eyeglass market, filing patent applications for that competitor.

Maling claimed that:

  1. He would not have hired Finnegan if he had known that the firm was representing the competitor in the same “patent space.”
  2. He was harmed when he asked the law firm to provide him with a legal opinion addressing similarities between Maling’s patents and the competitor’s patents, and the firm declined to do so. Without the opinion, Maling said, he was unable to obtain funding for his invention, and his product was unmarketable due to similarities with the competitor’s device.
  3. Maling alleged that 14 month delays in drafting patents for his invention were caused by Finnegan favoring the other client.

Maling engaged the Boston Office of Finnegan’s services in 2003 and, after various prior art searches, Finnegan filed and obtained four patents for Maling. The relationship terminated in May 2009. Over this same time period, attorneys in the Washington DC office represented Msunaga Optical Manufacturing Co. LTD. (henceforth Masunaga), a Japanese company also seeking patents for screwless eyeglasses. Maling considers it unacceptable and inexplicable that it took 14 months, until May 2004 for Finnegan to start drafting his applications, whereas Masunga’s were filed more quickly. He claimed to pay in excess of $100,000 to Finnegan for their services, and would not have done so had he been aware of the (alleged) conflict.

Maling requested relief based on:

  1. Breach of Fiduciary Duty
  2. Legal malpractice
  3. Unfair or deceptive practices
  4. inequitable conduct

Maling’s complaint alleged several claims for relief, including legal malpractice, all hinging on the existence of an alleged undisclosed conflict of interest arising from Finnegan’s representation of both Maling and his competitor.

The complaint was dismissed by the court of first instance and their decision was upheld on appeal on two grounds:

  1. The simultaneous representation by a law firm in the prosecution of patents for two clients competing in the same technology area for similar inventions is not a per se violation of Mass. R. Prof. Conduct 1.7.
  2. Based on the facts alleged in his complaint, Maling failed to state a claim for relief.

The case is Maling v. Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, SJC-11800, in the Massachusetts Supreme Judicial Court.

The Ruling

The relevant law is Rule 1.7 of the Massachusetts Rules of Professional Conduct. This law provides that a lawyer shall not represent a client if the representation is “directly adverse to another client,” Mass. R. Prof. C. 1.7 (a) (1), or where “there is a significant risk that the representation of one or more clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.” Mass. R. Prof. C. 1.7 (a).

At the time this action was brought, concurrent conflicts of interest were governed by 37 C.F.R. § 10.66 (2012) (entitled, “Refusing to accept or continue employment if the interests of another client may impair the independent professional judgment of the practitioner”), which provided:

“(a) A practitioner shall decline proffered employment if the exercise of the practitioner’s independent professional judgment in behalf of a client will be or is likely to be adversely affected by the acceptance of the proffered employment, or if it would be likely to involve the practitioner in representing differing interests, except to the extent permitted under paragraph (c) of this section.

(b) A practitioner shall not continue multiple employment if the exercise of the practitioner’s independent professional judgment in behalf of a client will be or is likely to be adversely affected by the practitioner’s representation of another client, or if it would be likely to involve the practitioner in representing differing interests, except to the extent permitted under paragraph (c) of this section.

(c) In the situations covered by paragraphs (a) and (b) of this section a practitioner may represent multiple clients if it is obvious that the practitioner can adequately represent the interest of each and if each consents to the representation after full disclosure of the possible effect of such representation on the exercise of the practitioner’s independent professional judgment on behalf of each.

(d) If a practitioner is required to decline employment or to withdraw from employment under a Disciplinary Rule, no partner, or associate, or any other practitioner affiliated with the practitioner or the practitioner’s firm, may accept or continue such employment unless otherwise ordered by the Director or Commissioner.”

The court ruled that “subject matter conflicts” do not fit neatly into the traditional conflict analysis. They opined that Maling’s interpretation of rule 1.7 would render all subject matter conflicts actionable per se. The court disagrees with this position. It considers that subject matter conflicts may present a number of potential legal, ethical and practical problems doe lawyers and their clients, but do not themselves consititute actionable conflicts of interest under rule 1.7.

What is forbidden is to represent a client in an adversarial matter against another entity that is a client, even if not in the same case unless one has the consent of both sides. In this instance, the two companies were each represented by Finnegan at the USPTO in patent prosecution, There was no inter partes proceeding. The fact that the two clients were economic rivals is insufficient to create an actionable conflict. Of note, there was no interference proceeding between applications of the two clients. Since both clients’ patents issued, there is no overlap in inventions.  Furthermore, there is no indication that an interference was likely.

The court further recognized that Finnegan opined regarding the Masunga patents, that would have been actionable, but Finnegan declined to do so. (the reason why they declined is not given).

Although in Sentinel Prods. Corp. vs. Platt, U.S. Dist. Ct., No. 98-11143-GAO (D. Mass. July 22, 2002) (Sentinel), the concept of ‘claim shaving’ is discussed, in this instance, Maling provided no evidence that the scope of his protection was limited by Finnegan out of deference to Masunga. This is mere speculation.

Finnegan’s refusal to opine regarding Masunga’s patents is suspicious, but whether or not Finnegan should have declined to take on Maling as a client in 2003 depends on the potential for conflict appreciated back then.

The court noted that Comment 8 to rule 1.7 elaborates:

“The mere possibility of subsequent harm does not itself require disclosure and consent. The critical questions are the likelihood that a difference in interests will eventuate and, if it does, whether it will materially interfere with the lawyer’s independent professional judgment in considering alternatives or foreclose courses of action that reasonably should be pursued on behalf of the client.”

In the oral argument, Maling’s counsel alleged malpractice or negligence in Finnegan’s failure to discover and disclose Masunga’s patents during their prior art search. As this allegation was not in Maling’s complaint, the court ignores the issue. In an interesting twist, Maling accused Finnegan of failing to disclose information to the USPTO (regarding the other client’s patents) and that this was inequitable conduct. The court noted a dearth of case law on the matter. The main issue seems to be that the attorneys working for the two clients were working from different offices.

In conclusion, although there are various factual scenarios under which client matter conflict may give rise to an actionable violation under Rule 1.7, the facts alleged to not amount to an actionable conflict. The dismissal of the complaint is reaffirmed.

COMMENTS
As noted by the Honorable J Cordy the issue at stake is whether there was an actionable conflict of interest (under Mass. R. Prof. C. 1.7, as appearing in 471 Mass. 1335 (2015)) when attorneys in different offices of the same law firm simultaneously represent business competitors in prosecuting patents for similar inventions without informing them or obtaining their consent to simultaneous representation.

The issue of Conflict of Interest is sometimes termed an ethical one. It is noted that there is a difference between legal ethics and ethics as generally understood. Once ethics are codified, they become regulations or laws. Ethics is appropriate behavior over and above that required by the law.

Various amicus briefs were filed. These include one by the Boston Patent Law Association and various ones by IP Law Firms including Knobbe, Martens, Olson & Bear, LLP; Honigman Miller Schwartz and Cohn LLP; Nixon & Vanderhye P.C.; Lewis Roca Rothgerber LLP; Schiff Hardin LLP; Steptoe & Johnson LLP; Snell & Wilmer LLP; Barnes & Thornburg LLP; Pillsbury Winthrop Shaw Pittman LLP; Verrill Dana LLP; and Morrison & Foerster LLP.

In large firms it is not unlikely that one attorney may be unaware of the clients of another. The client concerned about specific competitors can and should present a list of such competitors to his attorney to provide a clearance check.

Israeli standards of conflict of interest are different from those of the State of Massachusetts. An Israeli firm engaging Finnegan or another large US firm would probably have to bring complaints of alleged conflicts in US courts, which is not cheap and is not easy. There are, therefore, advantages in engaging local representation in Israel who are bound by local standards and can be sued locally.

It is more than likely that the two attorneys at Finnegan handling the spectacle hinge cases were unaware of the other client until the opinion issue arose. At that stage, it is clear from the front cover of the patent/application, who the attorney of record is.

One of the reasons suggested for employing a big IP firm is the fact that an attorney with relevant experience can handle specific cases. I don’t know to what extent practitioners pass work over to colleagues with specific experience. I expect it is rare, apart from partners who are essentially rain-makers rather than practitioners.

In general, it is much easier for small firms to avoid subject matter conflicts. Over the years, I have had client referrals from sole practitioners and smaller firms who had subject matter conflicts. I also have had referrals from colleagues that felt unhappy with their understanding of the subject matter. In some cases, this has been specific applications where the client has remained with the referrer and I have handled only the specific technology. In other cases, clients are referred. There are some attorneys who are specialists and only handle, say, telecommunication patents, or only handle pharmaceuticals. Other attorneys are generalists and are comfortable drafting and prosecuting a range of technologies. It is important that the attorney drafting the case understands the technology. Ideally the drafting attorney should have direct contact with the inventors.

Care should be taken to avoid working with attorneys that outsource work to unidentified sub-contractors, whether local or abroad. I don’t think that a 14 month drafting delay would happen in a small firm. suspect that in general smaller firms provide a better service and are more cost-effective than larger firms. However, at the end of the day, it is the attorney that handles the case and his/her experience that matters, not the size of the firm. It is where a file is touched by many hands, with trainees, junior associates and senior partners, paralegals and filing clerks all billing their time that prosecution gets delayed and costs escalate.

Maling’s allegation that Finnegan’s failure to disclose information to the USPTO regarding the other client’s patents was inequitable conduct was a dangerous argument. It undermines the validity of their own patents.