Opinion ID: 221276
Heading Depth: 2
Heading Rank: 1

Heading: Federal Circuit Cases

Text: Several opinions of the Federal Circuit applying Christianson suggest that USPPS's claim arises under patent law within the meaning of § 1338. In Air Measurement Technologies, Inc. v. Akin Gump Strauss Hauer & Feld, LLP, 504 F.3d 1262 (Fed.Cir.2007), and its companion case Immunocept, LLC v. Fulbright & Jaworski, LLP, 504 F.3d 1281 (Fed.Cir. 2007), the Federal Circuit held that a Texas state-law claim of attorney malpractice in a patent infringement case arises under patent law for purposes of § 1338. In Air Measurement Technologies, the court explained its reasoning thus: Under Texas state law, the elements of a malpractice claim are (1) an attorney owed plaintiff a duty stemming from the attorney-client relationship, (2) the attorney breached that duty, (3) the breach proximately caused plaintiff's injuries, and (4) damages. Because [the plaintiff]'s malpractice claim stems in part from unsuccessful prior litigation, [the plaintiff] must establish that they would have prevailed in the prior litigation but for [the defendant law firm]'s negligence that compromised the litigation. This is called the case within a case requirement of the proximate cause element of malpractice. . . . Because [in this case] proof of patent infringement is necessary to show [the plaintiff] would have prevailed in the prior litigation, patent infringement is a necessary element of [the plaintiff]'s malpractice claim and therefore apparently presents a substantial question of patent law conferring § 1338 jurisdiction. 504 F.3d at 1268-69 (internal citations omitted) (quoting Christianson, 486 U.S. at 809, 108 S.Ct. 2166). In Immunocept, decided on the same day as Air Measurement Technologies, the Federal Circuit addressed the federalism question that Grable reemphasized in a case presenting nearly identical issues to Air Measurement Technologies. The Immunocept plaintiffs filed suit against their law firm alleging a Texas state-law claim of attorney malpractice in prosecuting a patent on their behalf, specifically claiming a drafting mistake. Echoing Air Measurement Technologies, the court held that, [b]ecause it is the sole basis of negligence, the claim[ed] drafting error is a necessary element of the malpractice cause of action. As such, there is no way [the plaintiffs] can prevail without addressing claim scope. The parties, however, dispute whether there was a drafting mistake. Therefore, if determining claim scope involves a substantial question of federal law that passes the federalism muster of Grable, there is § 1338 jurisdiction over the malpractice claim under both Christianson and Grable. . . . . Because patent claim scope defines the scope of patent protection, we surely consider claim scope to be a substantial question of patent law. As a determination of patent infringement serves as the basis of § 1338 jurisdiction over related state law claims, so does a determination of claim scope. 504 F.3d at 1285 (internal citations omitted). The court then briefly turned to the propriety of federal jurisdiction as a question of federalism, an issue not explicitly addressed in Air Measurement Technologies: Claim scope determination is a question of law that can be complex in that it may involve many claim construction doctrines. Litigants will benefit from federal judges who are used to handling these complicated rules. Additionally, Congress'[s] intent to remove non-uniformity in the patent law, as evidenced by its enactment of the Federal Courts Improvement Act of 1982, is further indicium that § 1338 jurisdiction is proper here. Id. at 1285-86 (citing Pub.L. No. 97-164, 96 Stat. 25) (other internal citations omitted). Both Air Measurement Technologies and Immunocept thus concluded that the exercise of § 1338 federal jurisdiction was proper over state-law claims of malpractice where the alleged malpractice required the court to construe a patent. In Davis v. Brouse McDowell, L.P.A., 596 F.3d 1355 (Fed.Cir.2010), cert. denied, ___ U.S. ___, 131 S.Ct. 118, 178 L.Ed.2d 32 (2010), the Federal Circuit extended this doctrine to a question of patentability where no patent had actually issued. In Davis, the plaintiff sued her attorney for malpractice under Ohio state law, alleging that the lawyer had failed to timely file her patent application, resulting in the loss of patent protection and the withdrawal of her investors' funding. The court held that because the plaintiff in Davis was obliged to prove, by a preponderance of the evidence, that she would have obtained patents on her inventions but for [her attorney]'s alleged negligence. . . patent law is a necessary element of one of the legal malpractice claims presented in [the] complaint, and the district court properly exercised jurisdiction pursuant to 28 U.S.C. § 1338(a). Id. at 1361-62. The relevant facts of this case are similar to those in Davis, though there are of course some distinctions. Here, USPPS alleges that Renner's misconduct constituted a breach of fiduciary duty that ultimately led to USPPS's loss of patent protection in its invention. [2] Under Texas law, a cause of action for breach of fiduciary duty may take one of two forms: if the suit seeks damages, then the plaintiff must prove duty, breach, actual injury, and causation; whereas if the suit seeks an equitable forfeiture of the fee paid to the fiduciary, then the plaintiff need only prove duty and breach to recover. See, e.g., Si Kyu Kim v. Harstan, Ltd., 286 S.W.3d 629, 635 n. 1 (Tex.App.El Paso 2009, pet. denied) (citing Burrow v. Arce, 997 S.W.2d 229, 240 (Tex.1999)). USPPS's complaint does not seek fee forfeiture; indeed, it does not even allege that USPPS ever paid Renner or DuChez a fee that could be forfeited. Rather, USPPS explicitly seeks damages for the breach in the amount of lost revenues and royalties that it alleges it would have earned had the patent issued. Proof of injury and causation [is] . . . required when a plaintiff seeks to recover damages for a breach of fiduciary duty, Si Kyu Kim, 286 S.W.3d at 635 n.l, and USPPS would therefore have to prove both in order to prevail on the breach of fiduciary duty claim set out in its complaint. As in Davis, USPPS cannot prove causation without proving the patentability of its invention. Otherwise, the cause of USPPS's loss of patent protection would be based on the simple fact that its invention could not be patented, and not on any breach of fiduciary duty by Renner or DuChez. [3] USPPS argues that the validity of the patent is not necessary to the overall success of its claims. Rather, it argues that even if its patent was eventually found invalid, with better counsel it would have received royalties in the time between the date of patent issuance and when the patent was eventually found invalid. This assumes, of course, that USPPS's patent would have issued at all had USPPS had loyal counsel, a question that necessarily involves deciding an issue of patent law. USPPS also ignores the fact that it cannot recover from Renner and DuChez on its state-law claims for breach of fiduciary duty and fraud if their misconduct, no matter how egregious, did not injure USPPS. USPPS's stated theory of injury is that [m]illions of personalized postage stamps have been manufactured that are an infringement against which the patent would have afforded a right of recovery of royalties by USPPS. Without a valid patentand indeed, without also showing other personalized postage stamps would have infringed on its patent (another substantial question of patent law that likely would have to be decided)USPPS has no injury. USPPS's claims therefore depend upon resolving at least one issue of patent law in its favor. It therefore seems clear that, were we to merely apply the Federal Circuit's case law to this appeal, our inquiry would be at an end. Two complications preclude us from that simple resolution, however. First, our Circuit has expressed some skepticism of Air Measurement Technologies, see Singh, 538 F.3d at 340, and second, we must address USPPS's contention that the prior panel's decision on the merits at the motion-to-dismiss stage constitutes the law of the case that jurisdiction is proper before this court.