Introduction

Patent agents are licensed to practice before the United States Patent and Trademark Office (“USPTO”), and perform the same duties as patent attorneys in proceedings before the USPTO, including preparing and prosecuting patent applications and rendering opinions on whether certain inventions are patentable. Paul R. Rice, et. al., Attorney-Client Privilege in the U.S. § 3:19 (2015 ed.). However, patent agents, who are not members of the bar, are not considered attorneys. See Robert A. Matthews, Jr., Annotated Patent Digest § 42:24 (2016). Whether communications with patent agents should be protected under the attorney-client privilege has long been an open question for the courts, and one that, until recently, did not have a clear answer.

In March 2016, in a case of first impression, the Federal Circuit recognized a “patent-agent privilege,” which protects communications between a non- attorney patent agent and his or her client during the course of the patent agent’s authorized practice before the USPTO. Before the Federal Circuit’s decision in In re Queen’s University at Kingston, 2016 WL 860311, —F.3d— (Fed. Cir. Mar. 7, 2016), district courts were divided as to whether patent agent communications were privileged.

The Patent Agent’s Role: Sperry v. State of Fla. ex. rel. Fla. Bar, 373 U.S. 379 (1963)

The question of whether client communications with patent agents should be privileged stems from the patent agent’s unique role. Although not a licensed attorney, a patent agent engages in the practice of law before the USPTO. In Sperry v. State of Fla. ex. rel. Fla. Bar, 373 U.S. 379, 381 (1963), a seminal case that described the role of a patent agent, the State of Florida argued that it could enjoin the activities of a non-attorney patent agent because his work constituted the “unauthorized” practice of law. The United States Supreme Court disagreed. The Court began its analysis by recognizing that the patent agent’s work “constitutes the practice of law.” Id. at 383 (citations omitted). As the Court explained, the preparation and prosecution of patent applications requires that a patent agent advise clients concerning the patentability of inventions under applicable statutory criteria, and participate in the drafting of patent claims and specifications, among other things. Id.

The Court also held that although Florida could properly prohibit non-attorney patent practitioners from practicing law in the state, because the right of non-attorney patent agents to practice before the USPTO is conferred by federal law, Florida does not have the authority to regulate or enjoin those activities. Id. at 385. As the Court explained, Congress gave the Commissioner of Patents the power to “authorize practice before the Patent Office by non-lawyers, and the Commissioner has explicitly granted such authority.” Id. at 385. Therefore, “by virtue of the Supremacy Clause, Florida may not deny to those failing to meet its own qualifications the right to perform the functions within the scope of the federal authority.” Id. Looking to legislative history of the Patent Office and Administrative Procedure Act, the Court found that non-attorneys have been practicing before the Patent Office since “its inception, with the express approval of the Patent Office and to the knowledge of Congress.” Id. at 388.

While Sperry recognized a non-attorney patent agent’s right to practice law before the USPTO, it did not discuss whether patent agent communications with clients are privileged.

Split in Case Law

Lacking clear guidance from the Supreme Court, federal district courts were divided on the issue of whether patent agent communications were protected in the same manner as attorney client communications. Some courts found that communications with non-attorney patent agents fell outside the protections of the attorney client privilege. For example in In re Rivastigmine Patent Litigation, 237 F.R.D. 69, 102 (S.D.N.Y. 2006), the Court held that Sperry never intend to treat patent attorneys and patent agents as equals. Therefore, the Court declined to extend attorney-client privilege to communications between patent agents and their clients. Id. (“it does not follow that because the agent is permitted to engage in this defined subuniverse of legal practice, his activities are therefore equivalent to those of a practicing attorney.”). See also Joh A. Benckiser G. m. b. H., Chemische Fabrik v. Hygrade Prods. Corp., 253 F. Supp. 999, 1001 (D.N.J. 1966) (“In patent law, as in other fields, the rule is simply that communication between a client and an administrative practitioner who is not an attorney are not privileged.”).

On the other hand, in In re Ampicillin Antitrust Litigation, supra, the Court found that the Sperry Court sought to protect a client’s freedom to choose between a patent attorney or a patent agent to represent the client in proceedings before the USPTO. That freedom of selection would “be substantially impaired if as basic a protection as the attorney-client privilege were afforded to communications involving patent attorneys but not to those involving patent agents.” 81 F.R.D. at 393. The Court therefore found that communications with a registered patent agent would be protected by attorney client privilege. Id. See also Buyer’s Direct Inc. v. Belk, Inc., 2012 WL 1416639 (not reported) (C.D. Cal. April 24, 2012) (attorney-client privilege applies to communications between client and registered patent agent as along as the communications related to presenting and prosecuting applications before the USPTO).

Other courts adopted a hybrid rule of sorts, holding that the attorney-client privilege applies to patent agents communications, but only if the patent agent was working under the direct supervision of an attorney. See Golden Trade, S.r.L. v. Lee Apparel Co., 143 F.R.D., 514, 519 (S.D.N.Y. 1992) (communications with a patent agent are protected when made at the direction of a lawyer); Cuno, Inc. v. Pall Corp., 121 F.R.D. 198, (E.D.N.Y. 1988) (“In any event, the weight of authority holds that the privilege applies to confidential communications with patent agents acting under the authority and control of counsel”) (citations omitted). However, because the attorney client privilege protects communications between the attorney’s agent and the client, these courts did not extend the attorney client privilege, but instead treated patent agents as any other non-attorney.

Creation of Patent-Agent Privilege: In re Queen’s University at Kingston

In In re Queen’s University at Kingston, the Federal Circuit resolved this split in the district courts by creating a new, limited privilege. In that case, plaintiffs Queen’s University and PARTEQ (together, “Queen’s University”) withheld documents from discovery on the grounds that the documents reflected privileged communications between its employees and its patent agent. Queen’s University, 2016 WL 860311, at *1. The magistrate judge granted defendant’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.” See id. (citing Minute Entry for Proceedings Held Before Magistrate Judge Roy S. Payne, Queen’s (E.D. Tex. June 17, 2015), ECF No. 149). The district court overruled Queen’s University’s objection to the order, but stayed the ruling pending review by the Federal Circuit. Id.

The Federal Circuit stated that whether patent agent communications were privileged was one of first impression for that court and acknowledged that while it had the authority to define new privileges, it must do so with caution in light of the general presumption against creating new privileges. Id. at *5 (“Indeed, the Supreme Court has warned that evidentiary privileges ‘are not lightly created nor expansively construed, for they are in derogation of the search for truth.’”) (quoting United States v. Nixon, 418 U.S. 683, 710 (1974)).

The Federal Circuit began its privilege analysis by recognizing that courts have consistently refused to protect as privileged communications between clients and other non-attorney client advocates, such as accountants, or jailhouse lawyers. Id. at *6. (citations omitted). However, the Court found that the “unique roles of patent agents,” their authority to engage in activities constituting the practice of law, and the “current realities of patent litigation” distinguished patent agent communications from those of other non-attorney advocate communications, and weighed in favor of creating a new patent-agent privilege. Id. (“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 would seem to apply with equal force to patent agents.”) (Id. at *7.)

The Queen’s University Court then looked to the Sperry Court’s examination of the legislative history behind the creation of the Patent Office and found that because Congress had authorized patent agents to “engage in the practice of law before the Patent Office, reason and experience compel [it] to recognize a patent-agent privilege that is coextensive with the rights granted to patent agents by Congress.” Id. at *9. The Court explained that a patent-agent privilege was necessary to preserve a client’s reasonable expectation that communications in connection with preparing and prosecuting a patent application will remain privileged. “Whether those communications are directed to an attorney or his or her legally equivalent patent agent should be of no moment.” Id.

Potential Pitfalls—Scope of the Privilege

Determining the parameters of the newly created patent-agent privilege is likely to be the subject of future litigation. The burden of determining which communications come within the privilege “rests squarely on the party asserting the privilege.” Id. at *11. In attempting to define the scope of the privilege, the Federal Circuit looked to the regulations that set forth a patent agent’s ability to practice before the USPTO. Id. Specifically, 37 C.F.R. § 11.5(b)(1) provides that practice before the USPTO includes: preparing and prosecuting patent applications, consulting or advising clients in connection with filing a patent application or other document with the USPTO, drafting patent applications (including the specification or claims) and any amendments to the applications, and communicating with the USPTO regarding patent applications or related documents.

According to the Federal Circuit, communications between a client and a non-attorney patent agent that are in furtherance of the tasks described in Section 11.5(b)(1) are protected. Id. Also protected are communications “which are reasonably necessary and incident to the preparation and prosecution of patent applications or other proceedings before the Office involving a patent application or patent in which the practitioner is authorized to participate” [citations omitted]. Id. at *12. However, tasks that are not listed in C.F.R. § 11.5(b)(1) and “are not reasonably necessary and incident to the prosecution of patents before the Patent Office [will] fall outside the scope of the patent- agent privilege.” Id. Thus, a client’s communications with a patent agent concerning litigation matters, such as non-infringement of a third-party patent, are not within the scope of patent-agent privilege. Similarly, it is likely that patent agent communications related to licensing or other similar transactions would not fall within the scope of the newly created privilege.

The dissent in Queen’s University argued that the newly created privilege was both complicated and uncertain. For example, the dissent pointed out that, according to the majority, communications with a patent agent who opines on the validity of another’s patent in contemplation of litigation or in connection with the sale or purchase of a patent or on infringement, are not privileged. Id. at *16. However, federal regulations also state that, in certain circumstances, such communications would fall within the scope of a patent agent’s practice, thus making the communications arguably privileged, depending on the client’s intent in seeking the opinion from the patent agent. Id. The dissent also states that another gray area involves drafting contracts for assignments while patent applications are still pending, because, in some circumstances, whether or not such conduct is part of the patent agent’s authorized practice (and thus within the privilege) will depend on the law of the state in which the patent agent is practicing. Id. at *17. The dissent also notes that advising the client as to the scope of the patent-agent privilege would not be within the patent agent’s authorized scope of practice before the USPTO, thereby requiring the client to hire an attorney to determine the application of the newly created patent-agent privilege. Id.

In short, while clients may find some solace in the protections offered by the patent-agent privilege, the privilege is not absolute. Only those communications with patent agents that are related to the patent agent’s authorized practice before the USPTO will fall within the scope of the privilege. Other communications, including those related to litigation issues, remain discoverable.