Attorney client privilege and the US patent process

In a refreshing bit of clarity, the USPTO published a final rule yesterday settling the status of persons who represent clients before the Patent Trial and Appeal Board.

Here is the actual text of the new rule:

A communication between a client and a USPTO patent practitioner or a foreign jurisdiction patent practitioner that is reasonably necessary and incident to the scope of the practitioner’s authority shall receive the same protections of privilege under Federal law as if that communication were between a client and an attorney authorized to practice in the United States, including all limitations and exceptions.

I say “refreshing bit of clarity” because so very often a government agency will establish some new policy in a way that requires a lot of parsing and study.  This one is clear.

Now a bit of background.

Traditionally under US law the privilege between client and attorney is just that — a privilege between client and attorney.  And not just any attorney.  It was the attorney who was admitted to practice in the particular state where some court is trying to decide whether or not to permit an adversary to inquire into the communications.  Traditionally if you were in a particular state and you wanted a judge in that particular state to protect your client communications, you had better be an attorney admitted to practice in that particular state.

Plenty of “home cooking” has been served up over the decades to those who are not admitted to practice in a particular state, in the name of consumer protection but really for the purposes of excluding those who might compete with attorneys admitted to practice in that state.

Traditionally there was no such privilege if the service provider was, for example, a patent agent.  (By “patent agent” we mean a person who is registered to practice before the USPTO in patent cases, and who is not also an attorney admitted to practice in one of the states of the US.)  Traditionally there was no such privilege if the service provider was, for example, located outside of the US and not also an attorney admitted to practice in one of the states of the US.

There are more bits of clear writing in this Federal Register notice:

Attorney-client privilege exists to protect clients. It allows them to have full and frank discussions with attorneys when seeking legal advice, without fear that those discussions will be used against them in legal proceedings.

Applying the privilege to agents simply recognizes that they perform legal services and that clients deserve the same protections regardless of which type of authorized legal provider they choose. Further, some foreign jurisdictions rely entirely or almost entirely on non-attorney patent agents. In such jurisdictions, hiring an attorney to handle patent matters can be difficult or impossible.

The impression that a reader might get from the rule itself is that the rule is merely intended to set ground rules as to which communications at the time of the PTAB proceeding may be inquired into and which communications may not.  But the Federal Register notice goes on to say that the intended effects of the rulemaking extend to communications that took place far beyond the PTAB proceeding itself, into the world of the patent prosecution that had already taken place years earlier, during the prosecution of the patent application that led to the patent that is the subject of the PTAB proceeding.  The Federal Register notice says:

More fundamentally, this rule is not intended primarily to protect communications between clients and their counsel for purposes of PTAB proceedings. Rather, it is primarily intended to protect communications made when seeking patents at the USPTO or foreign IP offices, such as when prosecuting applications or contemplating whether to file. The counsel on those communications may not be involved in any PTAB proceedings. Communications about prosecution are much more commonly implicated in PTAB discovery proceedings than communications about the PTAB proceeding itself. Perhaps this reflects the inherent asymmetry of privilege protections: Both parties are affected if their communications seeking legal advice about the PTAB proceeding are discoverable, whereas only the patent holder is affected by discovery of communications from prosecution. Regardless, the purpose of the rule is to protect any communications with authorized counsel from discovery in PTAB, not just communications about the instant proceeding.

The alert reader will appreciate that the origins of attorney client privilege lie in state law.  This new rule does not, of course, have any power over the state courts which decide privilege questions in state court actions.  This new rule likewise does not have any power over federal courts which decide privilege questions in federal court actions.  This new rule, on its face, only has effect on discovery disputes which might arise in the narrow context of proceedings before the Patent Trial and Appeal Board.

But in a wink to all of those state court judges who might some day have to decide whether to protect client communications with a patent agent, or client communications with a foreign patent practitioner, the Federal Register notice says:

States may of course consider the policy issues the USPTO has documented when deciding privilege matters within their own courts for domestic and foreign patent agents and attorneys.

Are there winners and losers in this new rule?  Well, in some narrow sense it might be said that US attorneys are worse off.  Historically there are US attorneys who insisted to clients that they alone had the power to confer attorney-client privilege upon patent related communications.  Such US attorneys acted, for example, as the central point of contact between the applicant/client and the foreign patent practitioner.  This rulemaking will give new confidence to the applicant/client in communicating directly with foreign patent practitioners without fear of losing the communications privilege.

But the clear winners are those who wish to see a patent system that promotes science and the useful arts.  In such a patent system the inventors and the applicants are able to have discussions with service providers having any of a range of professional credentials (including patent agents and foreign patent practitioners) “without fear that those discussions will be used against them in legal proceedings.”

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