The owner of a fake IP law firm that is being sued in Colorado for allegedly engaging in the unauthorized practice of law has filed a motion to have the case dismissed for alleged lack of subject matter and personal jurisdiction.
Dak Steiert, the owner of “Intelligent Patent Services,” which purports to be a “patent law firm,” is the subject of a Petition for Injunction filed in September 2017 in the Supreme Court of Colorado. As we initially reported in our post here, disciplinary counsel in Colorado alleges that Steiert, who is not an attorney and has never been registered to practice before the USPTO, misappropriated the identities of real patent practitioners, which he claimed were part of the Intelligent Patent Services “law firm.” The IPS website also claimed that IPS was “co-owned” by two other non-lawyers in addition to Steiert. In truth, the Petition claims, “Intelligent Patent Services” (or “IPS”) was a hoax; the result of a massive identity theft allegedly orchestrated by Steiret, who claims to have ties to Stanford University (according to his LinkedIn profile and the IPS website). A copy of the Petition for Injunction is available here. The case is captioned People of the State of Colorado v. Dak Steiert, aka Dak Steirt and Intelligent Patent Services, LLC, No. 2017SA214 (Col. Sept. 11, 2017).
On November 28, 2017, Steiert filed a “Motion to Dismiss with Prejudice” on behalf of himself and IPS. The Motion to Dismiss alleges that Steiert personally and IPS “were not in and did not transact business from the State of Colorado for any of the actions listed in this case. ” According to Steiert, he resides at 220 East Flamingo Road, Unit 310, Las Vegas, Nevada, as allegedly evidenced by his Nevada driver’s license and Nevada Department of Motor Vehicle records. In addition, the motion to dismiss alleges that “Payments were received by a credit card processor not in Colorado and to the Headquarters of Intelligent Patent Services’s bank in California.”
The motion to dismiss also asserts that the Colorado Supreme Court lacks jurisdiction over the subject matter of the Petition because:
the practice of patent law is governed by the U.S. Patent and Trademark Office, not by the State of Colorado. As Intelligent Patent Services, LLC has only ever been involved in patent law, and no matters of state law whatsoever, the Colorado Supreme Court does not have jurisdiction over matters involving solely patent law.
Ironically, although Steiert apparently concedes he is not–and had never been–an attorney in any state, his motion to dismiss is filed on behalf of himself personally as well as his corporate entity, Intelligent Patent Services., LLC. This is potentially problematic because, as a matter of law, a corporation in Colorado may appear in court “only through a licensed attorney” and may not appear pro se. As the Colorado Court of Appeals has explained, “to allow a corporation to maintain litigation and appear in court represented by corporate officers or agents only would lay open the gates to the practice of law for entry to those corporate officers or agents who have not been qualified to practice law . . . .” Woodford Mfg. Co. v. AOQ, Inc., 772 P.2d 652 (Colo. App. 1988).
In other words, by appearing before the Colorado Supreme Court in a representative capacity on behalf of Intelligent Patent Services, LLC in response to a claim for engaging in the unauthorized practice of law, Steiert may very well be engaging in the unauthorized practice of law in the Colorado UPL action. The Presiding Disciplinary Judge in this matter had previously entered an Order advising Steiert and IPS that “in general, business entities may file pleadings and appear in Colorado courts only through a licensed attorney.” See C.R.C.P. 121 Section 1-1(2)(b)(V) (indicating that any party other than a natural person must be represented by counsel in court proceedings, unless the party is a closely held entity and the amount in controversy is less than $15,000.00).
On December 4, 2017, disciplinary counsel in Colorado filed a Response to Respondents’ Motion to Dismiss for Lack of Jurisdiction. A copy of disciplinary counsel’s Response here.
In its Response, disciplinary counsel noted that because Steiert is “neither a licensed patent attorney nor permitted to practice before the USPTO as a Patent Agent, USPTO exercised its jurisdiction, investigated the services he provided to inventors, and issued a cease and desist order to him.” Moreover, disciplinary counsel states that just because the USPTO exercised jurisdiction over Steiert and Intelligent Patent Services, that does not mean they get a free pass from Colorado, which has “separate and concurrent jurisdiction over Respondent Steiert’s unauthorized practice of law.” Colorado disciplinary counsel further aver that “state prosecution of unauthorized practice of law is not preempted by federal patent statutes and regulations” and that the Supreme Court of Colorado, therefore, has subject matter jurisdiction over both Steiert and IPS.
In addition, the Response provides evidence that it alleges demonstrates that Steiert and IPS are subject to personal jurisdiction in Colorado under the “minimum contacts” test. Cited as evidence in support of personal jurisdiction are the following documents:
- Periodic reports filed with the Colorado Secretary of State reflecting that IPS is a Colorado limited liability company with a principal place of business in Edwards, Colorado;
- Periodic reports showing Steiert (aka “D. Brandon Steiert”) as IPS’s resident agent and having the same Colorado street and mailing addresses as IPS;
- a “Patent Services Agreement” signed by Steiert and sent to an inventor-client on IPS letterhead identifying its Edwards, Colorado business address, with the Agreement including a “Choice of Law” provision mandating that “This agreement will be governed by and under the courts of Eagle County, Colorado”;
- IPS credit card payment forms identifying its billing address in Edwards, Colorado; and
- copies of IPS’s website reflecting its physical address in Edwards, Colorado.
Steiert filed a “Respondents’ Response” on behalf of himself and IPS. Again, with respect to the latter, the representational filing on behalf of a corporate entity IPS by non-attorney Steiert appears to be contrary to Colorado law, which requires in most cases that a corporate entity be represented by a licensed attorney. In their “Response,” Steiert and IPS allege they never received the USPTO’s cease and desist letter “presumably for the exact reason that there is no jurisdiction in this case: Respondents were not in the state of Colorado” and allegedly were never served.
Steiert’s “Response” asserts there is “no legal requirement” for him to change his address and “no means to update this [address] information on record with the [Colorado] Secretary of State.” The Response cites no legal authority in support of this proposition, and reiterates that the disciplinary counsel never addressed the fact that Steiert’s driver’s license is from Nevada which, he alleges, is “the only clear piece of evidence that must be updated with the whereabouts of the respondent.” A copy of the Reply is Here.
We will keep a close eye on this case and report on developments as they arise. In the meantime, this case serves as a warning to counsel as well as prospective patent clients: be careful who you do business with!