Monday, May 24, 2010

Rule 11 sanctions from inventorship dispute; relevance to Myriad?

from the decision:

Count VIII alleged a “breach of fiduciary duty by John
Doe I [patent attorney] in violation of 35 U.S.C. et seq., 37 CFR et seq., and
the Manual of Patent Examination Procedure (MPEP).”
Supplemental App. 35 (capitalization altered). The
district court found that “[t]he gravamen of Count VIII is
that Defendant John Doe I breached the fiduciary duty
owed to Plaintiff by representing two parties with conflict-
ing interests and by sacrificing the interests of one party
for another.” Carter, slip op. at 5. In evaluating this
claim, the district court stressed its concern that the
claim constituted an attempt “to manufacture a federal
cause of action by couching a garden-variety malpractice
claim in terms of patent law.” Id. In the district court’s
view, “[h]owever Plaintiff’s counsel couches it, no federal
cause of action exists for breach of fiduciary duty under
federal patent law or the MPEP.” Id. at 6

Bottom line:

Here, the determination of John Doe I’s compliance
with the MPEP and the CFR is a necessary element of
Carter’s malpractice cause of action because the CFR and
the MPEP establish John Doe I’s expected fiduciary
duties to his clients. Count VIII thus involves a substan-
tial question of federal patent law and is not frivolous.7


While we conclude that Count VIII was not frivolous,
we reach a different result with regard to Counts I and
XI. Count I alleges a violation of Article I, Section 8,
Clause 8 of the U.S. Constitution, which grants Congress
the power to “promote the Progress of Science and useful
Arts, by securing for limited Times to . . . Inventors the
exclusive Right to their respective . . . Discoveries.” The
district court rejected Myers & Kaplan’s assertion that
the Patent Clause creates a private cause of action on
behalf of inventors. Carter, slip op. at 4. The court noted
that Myers & Kaplan presented “no legal authority or
reasonable explanation as to how [the Patent Clause] does
confer a private cause of action.” Id. Myers & Kaplan
contends the district court erred because Count I presents
a non-frivolous argument for establishing new law, which Rule 11(b)(2) expressly permits.

Can anyone say ACLU v. Myriad?

The CAFC noted:

We agree with the district court that the Patent
Clause does not create private rights of action on behalf of
inventors. Myers & Kaplan’s assertion that no sanctions
should be imposed under Count I because this count
presents an argument for establishing new law ignores
the fact that the argument for creating new law must be
non-frivolous. There is no basis for inferring that Article
I, Section 8, Clause 8 provides rights to inventors without
congressional action, and we long ago made clear, in the
context of the Copyright Clause, that it does not. In In re
Cooper, our predecessor court rejected the argument that
the Clause itself required trademark protection for book
titles. 254 F.2d 611, 616 (C.C.P.A. 1958). The court
explained that “Article I, Section 8, eighth clause, of the
Constitution . . . does no more than grant power to Con-
gress to secure certain rights to authors and inventors
insofar as it elects to do so. The cited clause grants no
rights to authors and has nothing to dtion of trademarks.” Id. at 616-17.

**UPDATE. For a more conventional complaint about
a lawyer:

In the Matter of J. GREGORY SWANSON


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