By Peter Reap, J.D., LL.M.
Consistent with Rule 501 of the Federal Rules of Evidence and justified in light of reason and experience, the U.S. Court of Appeals for the Federal Circuit recognized a patent-agent privilege extending to communications with non-attorney patent agents when those agents are acting within the agent’s authorized practice of law before the USPTO (In re Queen’s University at Kingston, March 7, 2016, O’Malley, K.). Thus, in the dispute before the court, Queen’s University’s petition for mandamus relief was granted and the federal district court in Marshall, Texas, was ordered to withdraw its blanket order compelling the production of documents containing communications between Queen’s University and its non-attorney patent agents. On remand, the district court should assess whether any particular claim of privilege is justified in light of the privilege recognized today, the appellate court noted.
Queen’s University at Kingston was established in 1841 and is located in Kingston, Ontario, Canada. In 1987, Queen’s University founded PARTEQ Innovations in order to commercialize intellectual property arising from university-generated research. Queen’s University is the assignee of U.S. Patent Nos. 7,762,665; 8,096,660; and 8,322,856 (the “patents-in-suit”), and PARTEQ is the exclusive licensee. The patents-in-suit are directed to Attentive User Interfaces, which allow devices to change their behavior based on the attentiveness of a user.
On January 31, 2014, Queen’s University filed a complaint alleging patent infringement in the Eastern District of Texas against Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. (together, “Samsung”). Throughout fact discovery, Queen’s University refused to produce certain documents it believed contained privileged information. It produced three privilege logs that withheld documents based, inter alia, on its assertion of a privilege relating to communications with its patent agents.
Samsung moved the district court to compel the production of these documents, which included communications between Queen’s University employees and registered non-lawyer patent agents discussing the prosecution of the patents-in-suit. After holding a hearing on the matter, the magistrate judge granted Samsung’s motion to compel, finding that the communications between Queen’s University employees and their non-attorney patent agents are not subject to the attorney-client privilege and that a separate patent-agent privilege does not exist. The district court declined to certify the issue for interlocutory appeal, but agreed to stay the production of the documents at issue pending a petition for writ of mandamus. The petition for writ of mandamus was before the court.
Mandamus. In deciding whether to grant mandamus review for discovery orders that turn on claims of privilege, the court considers whether: “(1) there is raised an important issue of first impression, (2) the privilege would be lost if review were denied until final judgment, and (3) immediate resolution would avoid the development of doctrine that would undermine the privilege.” In re Seagate Tech., LLC, 497 F.3d 1360, 1367 (Fed. Cir. 2007) (en banc).
Mandamus review of the district court’s discovery order in this case was appropriate, the court ruled. The Federal Circuit has not addressed whether a patent-agent privilege exists—it is an issue of first impression for this court and one that has split the district courts. Immediate resolution of this issue will avoid further inconsistent development of this doctrine. Further, Samsung’s contention that changed circumstances warranted the denial of the petition for writ of mandamus was rejected.
Existence of the patent-agent privilege. The most well-known and carefully guarded privilege is the attorney-client privilege. It is well established that an attorney-client privilege exists to encourage full and frank communication between counselor and client and thereby promote broader public interests in the observance of law and administration of justice. It is true, moreover, that courts have consistently refused to recognize as privileged communications with other non-attorney client advocates, such as accountants.
Samsung conceded that, where a patent agent communicates with counsel or receives communications between his client and counsel, the attorney-client privilege may protect those communications from discovery. It contended, however, that, where counsel is not involved in the communications—as Queen’s University conceded was the case here—the court should neither expand the scope of the attorney-client privilege nor recognize an independent patent-agent privilege to protect such communications from discovery.
The unique roles of patent agents, the congressional recognition of their authority to act, the Supreme Court’s characterization of their activities as the practice of law, and the current realities of patent litigation counseled in favor of recognizing an independent patent-agent privilege, according to the Federal Circuit. InSperry v. State of Florida ex rel. Florida Bar, 373 U.S. 379 (1963), the Supreme Court expressly found that “the preparation and prosecution of patent applications for others constitutes the practice of law.” Id. at 383. Sperry, thus, confirmed that patent agents are not simply engaging in law-like activity, they are engaging in the practice of law itself. To the extent, therefore, that the traditional attorney-client privilege is justified based on the need for candor between a client and his or her legal professional in relation to the prosecution of a patent, that justification applies with equal force to patent agents, the court reasoned.
However, the most meaningful takeaway from Sperry, was the Supreme Court’s explanation of why states may not regulate that practice of law that provided the most support to the recognition of a patent-agent privilege. In holding that the State of Florida had no authority to regulate the admitted practice of law by patent agents, the Supreme Court emphasized that it is Congress who has authorized and continues to permit the practice of law by patent agents when appearing before the Patent Office.
In explaining its holding, the Supreme Court discussed the history of the Patent Office’s power to regulate patent agents. In view of this storied history, the Supreme Court found “strong and unchallenged implications that registered agents have a right to practice before the Patent Office.” Id. at 395. In Sperry, the Court found that the rights conferred to patent agents are federal rights and that Congress expressly permitted the Commissioner to promulgate regulations that allow patent agents to practice before the Patent Office in the 1952 Patent Act. Ultimately, Congress endorsed a system in which patent applicants can choose between patent agents and patent attorneys when prosecuting patents before the Patent Office. Based on this, the Court found that the State of Florida could neither prohibit nor regulate that which federal law allowed.
To the extent Congress has authorized non-attorney patent agents to engage in the practice of law before the Patent Office, reason and experience compelled the recognition of a patent-agent privilege that is coextensive with the rights granted to patent agents by Congress, the Federal Circuit decided. A client has a reasonable expectation that all communications relating to obtaining legal advice on patentability and legal services in preparing a patent application will be kept privileged. Whether those communications are directed to an attorney or his or her legally equivalent patent agent should be of no moment, the court said.
Samsung argued that none of the considerations set forth by the Supreme Court in Jaffee in recognizing a psychotherapist privilege under Rule 501 of the Federal Rules of Evidence supported the privilege recognized here. Jaffee v. Redmond, 518 U.S. 1, 8 (1996). The court agreed that the circumstances addressed in Jaffee were vastly different from those addressed today, and that the considerations upon which the Supreme Court rested its decision in Jaffeewere not all applicable here. Nothing in Jaffee counseled against the court’s conclusion today, however.
The Supreme Court’s characterization of the activity in Sperry coupled with the clear intent of Congress to enable the Office to establish a dual track for patent prosecution by either patent attorneys or non-attorney patent agents confers a professional status on patent agents that justifies the recognition of the patent-agent privilege, the court held.
Scope of the privilege. Regulations promulgated by the Office regarding the scope of a patent agent’s ability to practice before the Office help to define the scope of the communications covered under the patent-agent privilege. Communications between non-attorney patent agents and their clients that are in furtherance of the performance of these tasks (set out in 37 C.F.R. §11.5(b)(1)), or which are reasonably necessary and incident to the preparation and prosecution of patent applications or other proceeding before the Office involving a patent application or patent in which the practitioner is authorized to participate receive the benefit of the patent-agent privilege.
Dissent. In a dissent, Judge Reyna argued that the presumption against the creation of new privileges has not been overcome by any showing that the public interest will be served or that there is a real need for such a privilege.
The case is No. 2015-145.
Attorneys: Shawn Daniel Blackburn (Susman Godfrey LLP) for Queen’s University at Kingston, Parteq Research and Development Innovations. Matthew Wolf (Arnold & Porter LLP) for Samsung Electronics Co. and Samsung Telecommunications America, LLC.
Companies: Queen’s University at Kingston; Parteq Research and Development Innovations; Samsung Electronics Co.; Samsung Telecommunications America, LLC
MainStory: TopStory Patent FedCirNews
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