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PORTUS SINGAPORE PTE LTD v. KENYON AND KENYON LLP (2021)

United States Court of Appeals, Second Circuit.2021-02-19No. Nos. 20-1359, 20-1467

Summary

Holding. The court affirmed the district court's grant of summary judgment in favor of Kenyon, holding that no reasonable jury could find the law firm acted negligently when it followed the client's explicit urgent instructions to file the patent application using the standard national stage method within an extremely compressed two-day timeframe.

Portus Singapore hired the law firm Kenyon and Kenyon to file a U.S. patent application based on an international patent application, giving the firm only two days to complete the work before a filing deadline. Kenyon filed the application using the standard national stage method available under federal patent law. Portus later claimed that Kenyon committed legal malpractice by not advising about an alternative filing method that would have extended the patent term by three-and-a-half years. The district court granted summary judgment for Kenyon, finding no negligence had occurred.

On appeal, the court affirmed the dismissal. The court determined that Kenyon's conduct met the professional standard for patent attorneys by following Portus's explicit urgent instructions and using the ordinary filing method that was standard practice in 2001. Because Kenyon was retained for a narrow, time-sensitive purpose and had no reason to believe it should undertake additional analysis of alternative approaches, the firm did not breach professional standards. The court rejected Portus's expert opinion that relied on hindsight information from after the patent was filed.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether an attorney commits malpractice by following a client's explicit urgent instructions without proposing alternative filing methods
  • Whether the standard of care for attorneys should be measured by ordinary practice at the time of representation or by hindsight after outcomes become known
  • Scope of an attorney's duties when engaged for a narrow, time-sensitive purpose

Procedural posture

Portus appealed the district court's grant of summary judgment in favor of Kenyon on Portus's legal malpractice claim concerning the filing method used for a patent application.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

SUMMARY ORDER

Plaintiff-Appellant-Cross-Appellee Portus Singapore PTE Ltd. (“Portus”) appeals from a decision of the district court granting summary judgment in favor of Defendant-Appellee-Cross-Appellant Kenyon and Kenyon LLP (“Kenyon”) with respect to Portuss legal malpractice claim. That claim was premised on Kenyons failure to file Portuss U.S. patent (the “’526 Patent”) in such a manner that it would have granted Portus an additional three-and-a-half years of U.S. patent term. We assume the parties’ familiarity with the underlying facts, procedural history of the case, and relevant issues on appeal.

We review a district courts grant of summary judgment de novo, construing the evidence in the light most favorable to and drawing all reasonable inferences in favor of the non-moving party. See Ocean Ships, Inc. v. Stiles, 315 F.3d 111, 117 (2d Cir. 2002). Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).

Portus and Kenyon do not dispute that New York substantive law applies to this diversity action based on attorney malpractice. See Tinelli v. Redl, 199 F.3d 603, 606 (2d Cir. 1999). “To state a claim for legal malpractice under New York law, a plaintiff must allege: (1) attorney negligence; (2) which is the proximate cause of a loss; and (3) actual damages.” Achtman v. Kirby, McInerney & Squire, LLP, 464 F.3d 328, 337 (2d Cir. 2006) (emphasis omitted).

The district court properly granted summary judgment in favor of Kenyon because no reasonable jury could conclude that Kenyon behaved negligently. In essence, Portus argues that Kenyon was negligent when it filed the ’526 Patent as a national stage application under 35 U.S.C. § 371 without advising Portus of the option to file the ’526 Patent as a bypass continuation application under 35 U.S.C. § 111.

Portuss malpractice theory ignores the context surrounding Portuss engagement of Kenyon and incorrectly holds Kenyon “to the rule of infallibility,” rather than “the ordinary and reasonable skill and knowledge commonly possessed by a member of the profession.” Bernstein v. Oppenheim & Co., P.C., 160 A.D.2d 428, 554 N.Y.S.2d 487, 489 (1990). Portus contacted Kenyon for the very first time on June 15, 2001, just two days before the expiration of Portuss window to file a U.S. patent application based on its international application under the Patent Cooperation Treaty. Portuss sole communication with Kenyon was a 43-page fax sent by Portuss Australian patent counsel, which was labeled “URGENT” and instructed Kenyon to “proceed to enter the National Phase in the United States on behalf of our client” by “17 June 2001.”

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J. Appx 556–57.

Given this extraordinarily short timeframe and urgent subject matter, no reasonable juror could conclude that Kenyon acted unreasonably by following Portuss directions and filing a national stage application, rather than engaging in a time-consuming, costly, and unauthorized expenditure of resources to advise Portus about alternative methods of filing. Kenyon had no reason to suspect that Portus intended for Kenyon to do more than what it did. As far as Kenyon knew, it was being retained because (1) Portus had an international application under the Patent Cooperation Treaty, (2) Portus needed a U.S. patent based on that international application, and (3) time was of the essence. The district court therefore correctly concluded that, given the narrow and specific scope of Kenyons engagement, it was not unreasonable for it to file the ’526 Patent as instructed. See, e.g., Attallah v. Milbank, Tweed, Hadley & McCloy, LLP, 168 A.D.3d 1026, 93 N.Y.S.3d 353, 356 (2019) (affirming dismissal of a malpractice claim against a law firm that failed to “advise the plaintiff on the efficacy” of a potential lawsuit that fell outside the scope of the representation).

This conclusion was confirmed by Kenyons liability expert, Robert Stoll, who testified that, even after the passage of the American Inventors Protection Act, it was still the ordinary practice of U.S. patent lawyers to file national stage applications, rather than bypass continuation applications, when applying for U.S. patents based on international patent applications.

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As Stoll pointed out in his report, this was due in part to the administrative filing advantages associated with national stage applications, such as reduced filing fees and a streamlined application process. Accordingly, Kenyon simply followed “one among several reasonable courses of action” for filing the ’526 Patent, which does not constitute attorney malpractice. Rosner v. Paley, 65 N.Y.2d 736, 738, 492 N.Y.S.2d 13, 481 N.E.2d 553 (1985).

Although Portuss liability expert, Clare Cox, took issue with Stolls expert testimony,

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her conclusion that Kenyon should have filed the ’529 Patent as a bypass continuation was largely premised on information and documents that post-dated 2001 – including the decision of the U.S. Patent and Trademark Office (“USPTO”) denying Kenyons petition to convert the ’526 Patent application, which explained how the ’526 Patent could have been filed as a bypass continuation application in the first instance. As the district court properly recognized, “[t]he perfect vision and wisdom of hindsight is an unreliable test for determining the past existence of legal malpractice.” Darby & Darby, P.C. v. VSI Intl, Inc., 95 N.Y.2d 308, 315, 716 N.Y.S.2d 378, 739 N.E.2d 744 (2000) (internal quotation marks omitted). Just because Kenyon might have done things differently now with the benefit of hindsight – knowing, in particular, that the USPTO would experience significant delays in processing the ’526 Patent – that does not mean that its conduct in 2001 was unreasonable. To the contrary, given the specific instructions from Portuss Australian patent counsel, the short timeframe in which Portuss U.S. patent application had to be filed, and Stolls testimony that U.S. patent attorneys ordinarily filed such applications under § 371 in 2001, no reasonable jury could conclude that Kenyon “failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession[,] ․ [as] measured at the time of the representation.” Id. at 313, 716 N.Y.S.2d 378, 739 N.E.2d 744 (internal quotation marks omitted).

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* * *

We have considered Portuss remaining arguments and find them to be meritless. Accordingly, we AFFIRM the judgment of the district court.

FOOTNOTES

1

.   While 35 U.S.C. § 371 describes applications filed under that section as “national stage” applications, not “National Phase” applications, Portus acknowledged before the district court that “the direction to enter the ‘national phase’ was most reasonably interpreted as a direction to file an application under 35 U.S.C. § 371.” Portus Singapore PTE Ltd. v. Kenyon & Kenyon LLP, 449 F. Supp. 3d 402, 413 n.7 (S.D.N.Y. 2020).

2

.   Portus challenges Stolls testimony to the extent Stoll relies on records he recently obtained from the U.S. Patent and Trademark Office (“USPTO”). Assuming, without deciding, its challenge is sound, we consider Stolls testimony only insofar as it is also based on his experience as a representative of the USPTO.

3

.   Kenyon cross-appeals the district courts decision to admit Coxs testimony, but we assume without deciding that the district court properly admitted Coxs testimony because, even with her testimony in the record, Portus has failed to establish Kenyons negligence.

4

.   Because we affirm the district courts grant of summary judgment even after resolving all evidentiary challenges in Portuss favor, we need not decide whether the district court properly admitted the USPTO statistics and excluded the testimony of Portuss damages expert, Justin Lewis.