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Communications with Non-Attorney Patent Agents May Be Privileged: Fed. Cir.
Practical Law Legal Update w-001-4997 (Approx. 4 pages)
Communications with Non-Attorney Patent Agents May Be Privileged: Fed. Cir.
by Practical Law Intellectual Property & Technology
| Published on 08 Mar 2016 • USA (National/Federal) |
In In re Queen's University at Kingston, the US Court of Appeals for the Federal Circuit held that communications with non-attorney patent agents are privileged and protected from discovery under FRCP 26(b)(1) where the communications are reasonably necessary and incident to patent preparation and prosecution.
On March 7, 2016, in In re Queen's University at Kingston, the US Court of Appeals for the Federal Circuit recognized for the first time an independent patent-agent privilege that will protect from discovery certain communications between non-attorney patent agents and their clients ( (Fed. Cir. Mar. 7, 2016)). The decision settles a longtime district court split on the issue.
Queen's University at Kingston and its commercial venture, PARTEQ Innovations (collectively Queen's University), filed an action against Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. (collectively Samsung) in the US District Court for the Eastern District of Texas alleging infringement of three patents directed to active user interfaces used in smart phones.
During discovery, Queen's University withheld from production (and identified in three privilege logs) certain communications between its employees and its non-attorney patent agents discussing the prosecution of the asserted patents, asserting a "patent-agent privilege." Samsung moved to compel Queen's university to produce the communications and the district court granted Samsung's motion, holding that a separate patent-agent privilege does not exist. Queen's University thereafter petitioned the Federal Circuit for a writ of mandamus directing the district court to withdraw its order compelling production.
Applying Federal Circuit law, the court began by considering whether a writ of mandamus was the appropriate method to review the district court's order. In particular, the court noted that determining whether to grant mandamus review for discovery orders turns on whether:
- The issue raised is of first impression.
- The privilege would be lost if review were to be denied until final judgment.
- Immediate resolution would avoid the development of doctrine that would undermine the privilege.
The court determined that mandamus review was appropriate because:
- The question of whether a patent-agent privilege exists is a matter of first impression to the court.
- There was a split among district courts on the issue, and resolution of the issue was necessary to prevent further inconsistent development of the doctrine.
- Resolving the issue was necessary to prevent future outcomes where disputed documents are produced and then on appeal the court would have to separate the effect of the production of the privileged documents from other considerations that led to the judgment.
Turning to the underlying dispute, the court began by noting the FRE 501 authorizes courts to define new privileges by interpreting common law principles in view of the court's reason and experience. The court then analyzed the Supreme Court's 1963 decision in Sperry v. State of Florida ex rel. Florida Bar, which held that patent agent preparation and prosecution of patent applications before the US Patent and Trademark Office (USPTO) constitutes the practice of law (373 U.S. 379 (1963)).
Importantly, the Federal Circuit reasoned that:
- As explained by the Sperry court, Congress has endorsed the USPTO to regulate the activities of patent agents. Congress intended to allow patent applicants to choose between patent agents and patent attorneys when prosecuting patents before the USPTO.
- To the extent Congress authorized non-attorney patent agents to engage in the practice of law before the USPTO, it must also recognize that a patent-agent privilege coincides with the rights Congress granted to patent agents.
- Were the court to hold that communications between a patent agent and his client were not privileged in the same way communications between a patent attorney and his client are, the court would frustrate Congress's intent to allow individuals the freedom to choose between an attorney and a patent agent.
Having determined that a patent-agent privilege exists, the Federal Circuit addressed the scope of the privilege, holding that it is limited to only those communications that are either:
- In furtherance of the performance of the agent's tasks.
- Reasonably necessary and incident to the preparation and prosecution of patent applications before the USPTO.
In his dissent, Circuit Judge Reyna disagreed with the court's decision to create a new patent-agent privilege, instead reasoning:
- The majority did not overcome the presumption against creating new privileges by showing either:
- the public interest would be served; or
- there was a need for such a privilege.
- Congress recognized that agents would not have the same privileges as attorneys.
- An attorney-client type of privilege should not apply simply because someone is authorized to practice limited law before a specific administrative agency.
The decision is significant in that it creates a new basis for asserting a privilege and withholding (and logging) documents during patent litigation, where the asserted patent's prosecution is often at issue. As the Federal Circuit noted, the scope of the privilege is limited and when asserting the privilege counsel should take care to distinguish communications that are reasonably necessary to patent prosecution and those that are not.