In Defense of Contingent Fee Patent Lawyers
Many thanks to Steve Nipper, who, on today's "rethink(ip)" blog, posts a link to Joseph Hosteny's recent "Litigators Corner" article in the August, 2005 issue of IP Today. Many thanks also to Mr. Hosteny for airing some perhaps unpleasant truths about what goes on inside large law firms.
In case anyone wonders why patent litigation is so expensive, Mr. Hosteny provides some truthful and amusing insights. I chuckle because I know all too well the games that are played, having once been a large firm lawyer myself.
Big firms love patent cases (provided the client is loaded) because they are a license to print money. The opportunities for procedural shenanigans are almost limitless, what with Markman hearings, bifurcation of damages, requests for reexamination and all. And of course, it's absolutely critical to make sure you get all 50 identical copies of the same document as requested, not just the 49 actually provided. (You never know when a crucial admission might be penciled on the margin of the missing copy.) Sure there is a lot of overlap, and it might be hard for laypeople to see what these efforts have to do with anything important, but hey, what's money at a time like this?
What I've always enjoyed about contingent work is that it is lawyering in the purest form -- you don't do something unless it will realistically advance your case. Critics accuse contingent-fee lawyers of driving up legal expenses but I've never seen how that is the case -- even when I was on the other side and billing by the hour. (On the contrary, and more than once, I thought I really owed my contingent-fee opponents at least a case of wine or scotch for having helped me hit my hours for the year -- and then some.)
The truth is, today, with advanced technology, legal fees should be going down, not up. Most courts permit out-of-town lawyers to appear by phone for routine hearings. Depositions can be conducted via video to avoid travel time and minimize expense. PACER and other on-line resources make it easy to access well-researched briefs and memoranda on issues that come up over and over again. Still other on-line services make the expense and burden of a paper-based legal library obsolete too. Finally, is it really necessary that law firms be housed in the most expensive downtown real estate available? (It is, if what the firm is really selling is CYA insurance to nervous in-house counsel who will have a lot of explaining to do if a case goes south.)
The big problem for new contingent-fee lawyers is knowing which battles are, and which are not, worth fighting. It takes a bit of nerve and confidence not to waste time and effort on discovery battles or procedural matters that don't really affect the outcome of a case.
Mr. Hosteny's article is a good education for those just entering the contingent-fee field. Efficiency and economy are vital. It's also educational for those who may be on the receiving end of huge legal bills and wonder how they happen, assuming they care.
Thoughts on Lemelson
So the Federal Circuit has spoken. The late Jerome Lemelson gets his comeuppance. And companies around the country breathe a sigh of relief.
Whether Mr. Lemelson goes down in history as a modern day Thomas Edison (and I've sometimes had my doubts about Tom) or as just a shrewd manipulator of the legal system, remains to be seen. But whatever your views, last week's decision in Symbol Technologies v. Lemelson is significant and may well mark the end of an era.
If you haven't already done so, I strongly recommend spending some time at the Squire Sanders lemelsoninfo.com site and poking around the history of this fascinating case. One blog entry cannot begin to cover what's available or address the issues raised. But I'll share what I think are some highlights.
The trial transcripts -- all twenty-seven days' worth -- are instructive. First, it's genuinely refreshing to run across a judge who, in open court, says things like "I really don't give a damn what his knowledge was at the time of the deposition" and "Mr. Fey, what in the hell is going on here?" (Transcript Day 9 p. 20, lines 3-4, and p. 66, line 20.) Admittedly, this was a bench trial, but I think we need a bit more of that. (I like a judge who has the nerve to say what the rest of us are thinking.)
Lemelson attorney Gerry Hosier is one of the best in the business and has a reputation for great cross-examinations. I wasn't disappointed, and thought his cross of Plaintiff's patent expert, Martin Adelman, was pretty humorous. (Transcript Day 19 pages 131-138.) Guess the lessons for experts are: (1) avoid comparing yourself to God, and (2) be careful who you accuse of being a bank robber.
On a more serious note, this case raises important issues of patent law that, frankly, I'm not sure how should be resolved. Lemelson is correct that nothing in the statutory law limits the right to file continuing applications. He is right that procedurally he has done nothing wrong. If his original disclosure supports his later filed claims, the mere passage of time should not render those claims unenforceable (at least under the pre-1995 scheme). If his originally filed specification does not support those claims, that is a defense the accused infringers should prove with clear and convincing evidence.
And yet, there is something inherently strange about introducing claims 39 years after an application is filed. While it's hard to find anything in the statutory law that Mr. Lemelson violated, most observers will sympathize with his opponents here. I wonder if that might be the reason the Federal Circuit, in my opinion, drafted its decision to address the limited, and probably unique, circumstances of the particular case. With patent terms now limited to 20 years from the date of first filing, it's likely we will never see the Lemelson situation again. Perhaps that is what the Federal Circuit is banking on.
Another issue I find significant is Lemelson's objection to the Federal Circuit's practice of prohibiting citation to or consideration of unpublished decisions. He argues persuasively that prohibiting citation to unpublished opinions runs contrary to the idea that similarly situtated litigants should be treated the same and is inherently wrong and unconstitutional. I agree. This business of pretending that unpublished decisions never happened is a dirty little secret and has no place in a nation of laws and open courts. Precedent is precedent, and you can't avoid creating history by saying in advance, "This doesn't count."
Finally, I think Lemelson's arguments against the participation of numerous supposed amici were well taken. Basically, Lemelson argued that, far from being "friends" of the court, the amici were in fact well-coordinated participants in a coalition to defeat the Lemelson patents and that their participation was a thinly-disguised way of beating the page limitation that ordinarily applies to appellate briefs. Although I agree that a weak argument is not likely to get stronger simply by being repeated a dozen times, I do think that Lemelson's objections to the participation of so many "outsiders" had significant merit.
Again, the entire Lemelson saga is something that is probably unique and may well never be seen again, at least not in the same form. Still, I can't help asking whether last week's decision was, in fact, based on sound law. Or whether, collectively, the courts simply decided that, "Well, Jerry, you may be right but we're going to rule against you anyway, because we just don't like what you're doing." Kind of brings us face-to-face with the question of whether we truly do believe in the rule of law, or whether we pick and choose depending on who is involved.
