How to Protect Patent Invention Records from Discovery During Litigation
By: DEAN R. KARAU
A recent decision by the U.S. Court of Appeals for the Federal Circuit suggests a means by which companies can keep invention disclosure records from being discovered by opposing counsel in patent litigation. By modifying their disclosure procedures and forms, companies can erect a more certain barrier to having to turn over sensitive records to their adversaries.
Companies usually ask their research and development personnel to fill out an invention record when an inventor has an idea thought to be patentable. The standard form generally asks for information such as the name of the inventor, a description and the scope of the invention, the closest prior art, the first date of conception and disclosure to others, and dates of publication. The form is most often used to disclose an invention to the inventor's technical supervisors and to the company's patent attorneys, so that its patentability can be evaluated.
However, the inventor, untrained in patent law, often hurriedly fills out the form without an understanding of the legal definitions and standards involved. As a result, the inventor may make, and possibly commit the company to, imprecise or inaccurate statements that can come back to haunt the company in subsequent patent litigation.
During litigation, the company's attorneys will want to keep the disclosure form from being turned over to opposing counsel, who will try to use any poorly thought out statements against the company. However, until recently, most courts said that a company's patent attorney was a mere "conduit" between the company and the Patent and Trademark Office, meaning that the disclosure form, even though ultimately given to an attorney for her legal advice and assistance, was not protected by the attorney-client privilege. Thus, the form had to be turned over to opposing counsel, and could be used against the company. The Federal Circuit's recent decision changed that analysis.
In In re Spalding Sports Worldwide, Inc., 203 F.3d 800 (Fed. Cir. 2000), the inventors of a basketball with a polyurethane cover submitted an invention record to the company's corporate legal department. After the patent issued, Spalding sued a competitor for infringement. During discovery, the trial court ordered Spalding to turn over its invention records to the competitor because, according to the court, they were technical, not legal, in nature and not entitled to protection from discovery. Spalding appealed, and the Federal Circuit reversed.
Rejecting the "conduit" theory, the Federal Circuit said that an invention record cannot be discovered during litigation as long as it was prepared and provided to an attorney for the purpose of securing primarily legal advice on patentability and legal services in preparing a patent application. Thus, the Federal Circuit provided a road map for how to protect invention records from discovery.
Although the Federal Circuit suggested that an implied request for legal assistance may be sufficient, a prudent company will revise its procedures to be sure that its first step is an express request to its legal department or its patent attorneys for legal advice and services. That means that the company should consider submitting its disclosure forms directly to its legal department or patent attorneys, while copying other technical and company personnel only as necessary. The language of the disclosure form should be changed to state explicitly that the information is being submitted for legal advice on patentability and for obtaining legal services in prosecuting the patent. The form itself can be formatted as a confidential, privileged memorandum from the inventor to the legal department or patent attorney, with the subject line clearly stating its purpose. To continue to protect its privileged status, the company should circulate the memorandum only to those with a need to know the specific information contained in it.
By revising its invention disclosure procedures and its disclosure forms, a company enhances its litigation attorneys' chances of keeping hurriedly-made, imprecise or inaccurate statements out of the hands of its opponents during patent litigation.