Ropes & Gray Seeks Dismissal of Patent Malpractice Lawsuit

On Tuesday, March 23, 2010, Ropes & Gray, by and through their attorneys Patterson Belknap Webb & Tyler, filed a motion to dismiss in the United States District Court for the Eastern District of New York, seeking to dismiss a malpractice claim brought against the firm by Cold Spring Harbor Laboratory (CSHL).  The complaint filed against Ropes & Gray also names patent attorney Matthew P. Vincent, who allegedly engaged in plagiarism by copying 11 pages of text from a patent application filed by another scientist, Dr. Andrew Fire.  CSHL alleged that the copying of this material led to the United States Patent and Trademark Office concluding that the work of Dr. Hannon (of CSHL) was indistinguishable from Dr. Fire’s work and, therefore, unpatentable.  The problem with this theory, as was pointed out in the Ropes & Gray motion to dismiss, copying text out of other patents and patent applications is done all the time.  The bigger problem for the plaintiff is that the USPTO rejected the application on other grounds as well.

First, let me be as clear as I can.  It does not seem to me that Ropes & Gray did anything wrong, and it also does not seem that the attorney involved did anything wrong with this patent application, at least not that would or should be considered malpractice.  Nevertheless, according to Law.com, Ropes & Gray fired Vincent last year after discovering that a patent database company that billed the firm and its clients more than $730,000 was secretly owned by Vincent.  Vincent also had charges pending against him by the Massachusetts Bar, which apparently prompted him to resign from the Massachusetts Bar in July 2009.  Further discussion of the impact of the self-dealing and/or charges brought against Vincent would be speculative, but it does seem appropriate to wonder whether CSHL was bolstered by questionable activities by Vincent that do not seem to relate to the underlying lawsuit.

The Ropes & Gray motion to dismiss sums up the argument pretty well on page 2 under Preliminary Statement:

Although the science underlying Dr. Hannon’s alleged invention may be complicated, the fundamental flaws in CSHL’s malpractice claim are simple and apparent.  Whereas the Complaint focuses exclusively on the PTO’s reliance upon Fire, the decisions rejecting the various Hannon Applications – the same rejections that CSHL cites in its Complaint – rejected the proposed claims not only based on Fire, but also on the separate and independent grounds that Dr. Hannon’s alleged invention was not patentable in view of earlier disclosures by other researchers in addition to Dr. Fire. The Complaint fails even to mention the PTO’s reliance upon the disclosures of these other scientists, much less to suggest that anything Mr. Vincent did led the PTO to conclude that their disclosures provided independent bases for rejecting the claims sought in the Harmon Applications. This failure alone means that CSHL cannot meet the causation elements of its malpractice claim.

Then at the top of page 5 the plagiarism charge is addressed:

The crux of CSHL’s malpractice claim is its allegation that Mr. Vincent improperly described Dr. Hannon’s work in the early patent applications by copying text from the Fire Application and then subsequently relied upon that allegedly improper description. (Compl. ¶ 27.) Significantly, CSHL does not contend that there is anything inherently wrong with copying text into a patent application. To the contrary, such copying is accepted practice. See DAVID PRESSMAN, PATENT IT YOURSELF 181 (13th ed. 2008) (sold in the PTO’s store and relied on by many practitioners) (“If you see any prior-art patent whose specification contains words, descriptions, and/or drawing figures that you can use in your application,  feel free to plagiarize! Patents are not covered by copyright and it’s considered perfectly legal and ethical to make use of them.”)

In researching this matter I turned to one of the leading experts on the Manual of Patent Examining Procedures, PLI’s own John White, who is a patent attorney himself and has for years taught the PLI Patent Bar Review course he co-created.  According to John:

The practice of copying segments of published applications, entire patents, and published research works by others is common. It even receives official sanction in the “incorporation by reference” rules of the USPTO. It is well understood that boilerplate background or state of the art statements do not need to be originally written when the subject is widely known and acknowledged as such. Generally the copying is done with explicit attribution, i.e., “incorporate by reference”, but there is no such Official requirement to do so. What matters is: what is in the claims; who “conceived” of that subject matter; and, whether the USPTO was aware of the starting points for the listed inventors as compared to the work of others not listed?”

All of this being the true, what does the plaintiff stand to gain?  Why would they take such an action?  It is difficult, if not impossible to predict the motives of any party during a litigation, but there does seem to be a disturbing trend with respect to malpractice cases being filed against name brand patent firms.

There was Akin Gump losing a $72.6 million verdict in May 2009, which sent a shock wave through the patent community and large law firms in particular.  In that case a single patent attorney who had joined Akin Gump missed a 102(b) date prior to even joining Akin Gump.  Several years ago, the straw that might have broken the back of Pennie & Edmonds was the U.S. District Court for the Western District of New York ruling that the University of Rochester patent relating to Cox II Inhibitors was invalid.   Pennie & Edmonds already had ethical problems associated with not telling existing clients who would be targets of the patent that they were representing the University of Rochester, and when the patent estimated to bring in $4 to $5 billion to the University in royalties was lost the writing was on the wall.

According to White, “it is true that patent practice used to be a murky, sleepy, backwater for malpractice. But, when the big firms waded into the water, the malpractice claims starting sprouting like weeds. I do not think any more malpractice is occurring statistically, but more claims are being made owing to the insured presenting a more attractive target.”  But what can firms do?  “You just hope you have systems in place and friendly clients such that it doesn’t happen to your firm. You can also pray about it.”

Praying is something that most patent attorneys are likely familiar with, or for those who are not religious — extreme hope in a anxious way — may be a better way to describe it!

If the Ropes & Gray incident were isolated it wouldn’t be worth more than a passing mention, but sadly it is not isolated.  It seems Ropes & Gray is facing a lawsuit they will win, eventually, and it is not fair to on the merits lump in this activity (where there is nothing inappropriate) with the rouge attorney Akin Gump had to deal with or the unfortunate error in the Cox II case.   Yet, it is impossible not to recognize that there is a disturbing trend in the top end, name brand area of the patent law industry.  Larger firms are targets, and with patent prosecution fees getting squeezed and companies outsourcing and/or demanding low flat fees the once venerable names in the industry are vanishing.  Patent litigators who can bill more hours and charge more are going to large litigation firms, severing ties with the low margin prosecution work and perhaps also with the high liability that goes along with it.

On top of this, a single attorney who may be negligent or acting inappropriately can bring an entire firm down, or at least down to their knees.  No matter how successful you are no one wants to lose $72.6 million, and there is just not enough insurance to cover a $4 to $5 billion mistake.  There have been instances where small firms have faced troubled patent attorneys who were disbarred or disciplined as well.  So attorneys in all firms of every size must wonder not only whether they have accidentally missed a date or made a mistake, but what about the guy in the office next to me?

Times are definitely changing in the patent law industry.  The day of calm waters and little to worry on the malpractice front seems over for patent attorneys, there is just too much at stake.  I suspect moving forward we will see prosecution move into smaller and smaller firms, who may attempt to engage in creative corporate structure to limit liability as much as possible, perhaps operating under a trade name collectively, sharing resources and staff, but being independently incorporated.

In the meantime, as things continue to unfold within the industry, everyone needs to take a good look at what is happening to Ropes & Gray and realize that bad results can and will lead to malpractice claims, just like in medical malpractice cases.  Negligence and deviation from the standard owed is secondary, if not completely irrelevant, when a client is facing a bad outcome.  After all, it couldn’t be the client who is to blame, or another inventor who was really the first inventor (and first to file).  I has to be the patent attorneys!

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10 comments so far.

  • [Avatar for Gene Quinn]
    Gene Quinn
    April 6, 2010 05:54 pm

    Richard-

    I agree with you. I don’t copy and paste, although it is done by many. If something is described particularly well I might use it as a reference to inform me how I will describe things, but I am not with the copy and paste crowd either.

    Applicants should be given Miranda warnings. Anything you do say can and will be used against you. Sad that it is that way. No wonder the USPTO is so far behind.

    -Gene

  • [Avatar for Richard (IP & Patent Counsel)]
    Richard (IP & Patent Counsel)
    April 6, 2010 12:27 pm

    Gene,

    Interesting post, interesting commentary. When I first heard about the suit, it seemed that liability was pretty clear. But, I did not have all of the facts (still don’t, but at least I now have more), and with any dispute, that makes all of the difference.

    That being said, however, while it may not be unethical, illegal, improper, etc. to “copy and paste” portions of an application (obviously, we are not talking about the claims), one must always question whether that is appropriate and in the best interests of the prosecution. I do not charge flat fee rates for my patent work and the thought of merely “copying and pasting” material from another unrelated application just doesn’t pass the sniff test. That is not what I am being paid to do. Certainly, I may take portions of related applications because they do an excellent job of perhaps explaining a certain phase or element of underlying technology, but you can be sure that I will go through it with a fine toothed comb if I decide to use it in the spec. Over the many years, my philosophy has changed a bit, and I now adhere to the principle “Don’t say more than you need to, and if what you include in the application does not help you, it can only hurt you.” I am sure there will be disagreement, but I am a champion of less is better (as long as the claims are fully supported) and don’t offer extraneous information. I think a copy ‘n paste approach would run afoul of my current philosophy. Thanks.

  • [Avatar for Steve M]
    Steve M
    March 30, 2010 07:28 pm

    Even to a little pro se with no dog in this fight, the idea that patent prosecution can be handled and treated like a car assembly line is abhorrent.

    Patent prosecutors know too much and work too hard; and their work is too important; to be paid on a flat-fee basis … and especially so when those fees are less than $5,000 each.

    Other-country outsourcing?

    Is that how little you companies believe your apps to be worth?

    Is that how little value your “inventions” provide?

    You can’t flat-fee innovation.

  • [Avatar for Kevin Schwartz]
    Kevin Schwartz
    March 29, 2010 03:01 pm

    I’ll see if I can track it down online. It was filed December 2008.

  • [Avatar for Gene Quinn]
    Gene Quinn
    March 29, 2010 01:52 pm

    Kevin-

    Do you have any more information about this lawsuit? Do you know which court it was filed in? That really changes a lot and does smack of retaliation.

    -Gene

  • [Avatar for Kevin Schwartz]
    Kevin Schwartz
    March 29, 2010 12:58 pm

    Nobody has apparently picked this up yet, but should be worth noting that Ropes & Gray sued Cold Spring Harbor in December 2008 for non-payment of fees, and sought to attach liens to all of CSHL’s patents for which CSHL had not paid their bills. Me thinks this suit is retaliatory.

  • [Avatar for Gene Quinn]
    Gene Quinn
    March 29, 2010 12:03 pm

    Sunshine-

    You raise an excellent point, and one I thought of but decided to hold off for another day. I am working on a companion article here, and I suspect this will lead to several other articles as well. I wanted to get the facts out, at least to some extent, and set the table for further discussion of the changing industry. I also want to address the fact that the inventor must have read the patent application and signed the oath or declaration verifying it was their work. That alone seems to undercut any and all arguments CSHL has or could raise.

    I also have theories about how/why the industry is changing and will be expanding upon this statement in the article:

    “Patent litigators who can bill more hours and charge more are going to large litigation firms, severing ties with the low margin prosecution work and perhaps also with the high liability that goes along with it.”

    I think there are a number of reasons why the boutiques are disappearing, and we may be starting to see a perfect storm that will completely reorganize patent practice in the US. Add onto this the fact that the US government is unwilling to stop violations of US export laws by outsourcing patent work to India, and the OED refusal to go after those openly practicing law without a license on the patent procurement front, and patent prosecution is really becoming an albatross.

    -Gene

  • [Avatar for Gene Quinn]
    Gene Quinn
    March 29, 2010 11:58 am

    ipguy-

    I think the support for the fact that there is no copyright protection in the text or drawings in a patent application or patent come from a variety of sources. Rule 71(d) says, in part: “A copyright or mask work notice may be placed in a design or utility patent application adjacent to copyright and mask work material contained therein. The notice may appear at any appropriate portion of the patent application disclosure. For notices in drawings, see § 1.84(s). The content of the notice must be limited to only those elements provided for by law.” This seems to suggest that if you want to reserve copyright protection in anything placed in a patent application or patent then you have to include the notice. No notice then no copyright.

    Also, take a look at Veeck v. Southern Building Code Congress International, Inc., — F.3d —-, 2002 WL 1270117 (5th Cir. 2002). The issue in this en banc case was the extent to which a private organization may assert copyright protection for its model codes, after the models have been adopted by a legislative body and become “the law”. Specifically, may a code-writing organization prevent a website operator from posting the text of a model code where the code is identified simply as the building code of a city that enacted the model code as law? The short answer is that as law, the model codes enter the public domain and are not subject to the copyright holder’s exclusive prerogatives. I know this is not exactly on point, but it seems that when the patent application or patent is published/issued it enters the public domain, at least with respect to being reproduced as a public record.

    If anyone else has thoughts that would be great. I suspect this would make an excellent article.

    -Gene

  • [Avatar for ipguy]
    ipguy
    March 29, 2010 11:35 am

    Hi Gene

    Your post raises some questions with which I have previously wrestled. I do not dispute the fact that it is common practice for some practitioners to copy verbatim from others’ work product, however, even if true, that neither makes it right nor even acceptable drafting practice. Copying may or may not relate to the malpractice at bottom in the Cold Spring Harbor suit, but I am not sure on what basis verbatim copying constitutes “zealous representation”. Was the client fully informed, and charged accordingly? Any competent patent attorney knows that each case has its own unique merits and requires thoughtful consideration of same, particularly during the drafting stage. In my view, even verbatim copying “boilerplate” can lead to trouble, e.g. if the definitions do not meet the needs of the client for that specific application and the claims it contains.

    Moreover, are you suggesting (and do you have support for the position) that a patent application is not subject to any degree of copyright protection? I am not convinced that copyright does not subsist in a patent application from the moment of its creation.

    Is there *any* support for the naked assertion quoted “Patents are not covered by copyright and it’s considered perfectly legal and ethical to make use of them.”

    At least for design applications and for masks, it seems that the application of both copyright and patent protection are clearly intended to go hand in hand.

    As the CCPA stated in In re Yardley:

    “The Congress, through its legislation under the authority of the Constitution, has interpreted the Constitution as authorizing an area of overlap where a certain type of creation may be the subject matter of a copyright and the subject matter of a design patent. We see nothing in that legislation which is contradictory and repugnant to the intent of the framers of the Constitution. Congress has not required an author-inventor to elect between the two modes which it has provided for securing exclusive rights on the type of subject matter here involved. If anything, the concurrent availability of both modes of securing exclusive rights aids in achieving the stated purpose of the constitutional provision.”

    (CCPA 1974) 493 F.2d 1395-96, 181 USPQ 336.

    Is there any basis on which to conclude that a similar overlap could not be found for utility applications to the extents that they are literary works?

    I suspect most practitioners will disagree strongly, but is there a statutory provision or case law that squarely holds that utility applications are *not* the subject of copyright protection? I would posit that any such protection would be subject to limitations such as the waiver currently accepted by the USPTO for design applications:

    “A portion of the disclosure of this patent document contains material to which a claim for copyright is made. The copyright owner has no objection to the facsimile reproduction by anyone of the patent document or the patent disclosure, as it appears in the Patent and Trademark Office patent file or records, but reserves all other copyright rights whatsoever.”

    We once prepared a patent application for Big Corp. on subject matter generally related to a joint development agreement with Little Co. As a courtesy, Big Corp. provided a pre-filing copy of the application to their much smaller development partner although the application in question was on the boundaries of the agreement and properly named only Big Corp’s inventors. Little Cos. counsel took the application virtually in its entirety, and filed it first, naming only Little Co. inventors. We discussed with Big Corp. many strategies for dealing with the situation, including possibilities of copyright infringement. That claim was never pursued, but do you think there would have been a possible claim of copyright infringement against Little Co or its attorneys, and/or a proper claim of malpractice against the attorney if Little Co. later felt aggrieved in some way by its own (outside) attorneys?

    Finally, if there are any rights under copyright imbued in a patent application – who owns them – the drafting attorney or the client? At first blush, I would argue that the drafting attorney holds the copyright in most cases unless it is a work for hire.

    Sorry for the long post.

    As always, keep up the good work!

  • [Avatar for Sunshine]
    Sunshine
    March 29, 2010 09:50 am

    What effect on the level of culpability is there in that the inventor must swear that what is contained in the application is the inventor’s own work?

    “I hereby declare that:…(2) I believe the inventor(s) named below to be the original and first inventor(s) of the subject matter which is claimed andfor which a patent is sought on the invention titled:”

    “I hereby state that I have reviewed and understand the contents of the above identified application, including the claims, as amended by any amendment specifically referred to above.”

    “I hereby declare that all statements made herein of my own knowledge are true and that all statements made on information andbelief are believed to be true; and further that these statements were made with the knowledge that willful false statements andthe like so made are punishable by fine or imprisonment, or both, under 18 U.S.C. 1001 and that such willful false statementsmay jeopardize the validity of the application or any patent issued thereon.”