Maling v. Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
42 N.E.3d 199, 473 Mass. 336 (2015)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
The simultaneous representation by a law firm of two clients competing for patents in the same technology area is not a per se violation of professional conduct rules. An actionable conflict of interest only arises if the representation is "directly adverse" or is "materially limited" by the lawyer's responsibilities to another, which must be supported by specific factual allegations rather than conclusory statements.
Facts:
- In 2003, inventor Chris E. Maling engaged the law firm Finnegan, Henderson, Farabow, Garrett & Dunner, LLP (Finnegan) to file and prosecute patents for his new screwless eyeglass design.
- Attorneys in Finnegan's Boston office represented Maling from approximately 2003 to 2009.
- During this same period, attorneys in Finnegan's Washington, D.C. office represented Masunaga Optical Manufacturing Co., Ltd. (Masunaga), a competitor also seeking patents for screwless eyeglass technology.
- Finnegan did not disclose its concurrent representation of Masunaga to Maling, nor did it obtain his consent.
- Finnegan successfully obtained four separate patents for Maling's inventions.
- In 2008, Maling requested a legal opinion from Finnegan regarding similarities between his patents and Masunaga's patents.
- Finnegan declined to provide Maling with the requested legal opinion.
- Maling later learned that Finnegan had been representing his competitor, Masunaga, throughout the same period.
Procedural Posture:
- Chris E. Maling first sued Finnegan in the United States District Court for the District of Massachusetts.
- The federal district court dismissed the complaint for lack of subject matter jurisdiction.
- Maling refiled his case in the Massachusetts Superior Court, alleging claims including breach of fiduciary duty and legal malpractice.
- Finnegan, the defendant, filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted.
- The Superior Court judge granted Finnegan's motion to dismiss.
- Maling, the plaintiff-appellant, appealed the dismissal to the state's intermediate appellate court.
- The Supreme Judicial Court of Massachusetts, the state's highest court, transferred the case for direct review on its own motion.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a law firm's simultaneous representation of two competing clients in prosecuting patents for similar inventions, without disclosure or consent, constitute an actionable conflict of interest per se under Mass. R. Prof. C. 1.7?
Opinions:
Majority - Cordy, J.
No, the simultaneous representation by a law firm in the prosecution of patents for two clients competing in the same technology area for similar inventions is not a per se violation of Mass. R. Prof. C. 1.7. An actionable conflict requires specific facts showing either direct adversity or a material limitation. The court analyzed the claim under both prongs of Rule 1.7. Under Rule 1.7(a)(1) ('directly adverse'), the court found that representing economic competitors is not direct adversity. Direct adversity requires a conflict over legal rights, such as opposing parties in litigation or competitors in a USPTO 'interference proceeding' for the same patent claims. Maling and Masunaga were merely economic competitors, and Maling failed to allege facts suggesting an interference proceeding was likely. Under Rule 1.7(a)(2) ('material limitation'), the court determined Maling failed to allege sufficient facts to show Finnegan's representation was compromised. Maling's claims that Finnegan 'pulled its punches' or favored Masunaga were conclusory and speculative. He did not allege specific actions like 'claim shaving' (narrowing his patent claims to benefit Masunaga) or misuse of confidential information. Because Maling failed to plead sufficient facts to support an actionable conflict under either prong, his claims were properly dismissed.
Analysis:
This decision establishes that so-called 'subject matter conflicts' in patent prosecution are not automatically actionable. It rejects a per se rule against representing competitors in the same technological space, instead requiring plaintiffs to plead specific facts demonstrating an actual conflict. This ruling raises the pleading standard for malpractice claims based on such conflicts, requiring plaintiffs to show concrete evidence of direct legal adversity or a material limitation on the attorney's performance, such as 'claim shaving' or misuse of confidential information. While giving law firms some leeway, the case also serves as a strong warning about the necessity of robust, firm-wide conflict-checking systems to detect and manage potential conflicts before they become litigious issues.
