Disposition: ALJ’s initial decision recommending entry of default judgment and practitioner’s exclusion from practice before the USPTO became final Agency decision as a matter of law. Final decision here.
Summary: An IP attorney who had been licensed since 1988 and had a history of professional discipline was charged with multiple counts of ethical misconduct arising from the abandonment of multiple clients’ patent and trademark applications and failure to cooperate with the OED’s investigation. After failing to respond to the complaint, an administrative law judge entered an initial decision recommending entry of judgment by default in favor of the OED and proposing that the practitioner be excluded from practice before the USPTO. Because the practitioner failed to appeal, the ALJ’s initial decision became the USPTO’s final decision as a matter of law, and thus the practitioner was excluded.
Related to USPTO Practice? Yes.
Facts: On January 13, 2016, the OED Director filed a complaint against Russell W. Warnock alleging that Mr. Warnock engaged in a pattern and practice of allowing both patent and trademark applications to go abandoned for, among other things, failing to respond to an Office Action or a Notice to File Missing Parts in patent applications, and failing to respond to an Office Action or file a Statement of Use in trademark applications. The complaint sought Mr. Warnock’s suspension or exclusion.
The complaint specified numerous matters in which Mr. Warnock had abandoned client matters. By way of example, he filed a patent application for a client in 2009. In 2012, the Office mailed a Notice of Allowance. Mr. Warnock failed to respond. When asked for an update, Mr. Warnock falsely informed his client that everything was on track, and that they were waiting for a reply from the USPTO. On March 18, 2013, the Office mailed a Notice of Abandonment for failure to respond to the Notice of Allowance.
The client independently learned about the abandonment. When he contacted Mr. Warnock, the attorney did not inform the client that the application had been abandoned many months earlier. Instead, he promised to “take care of restoring [the application] to active status” if the client would pay the issue fee. Although the client requested that this be done, Mr. Warnock failed to respond to the Notice of Allowance or submit the issue fee.
Similar facts regarding Mr. Warnock’s failure to respond to USPTO correspondence, or inform the clients about such correspondence, or misrepresenting the status of ongoing matters to clients, were alleged throughout the complaint.
On March 2, 2015, OED sent a Request for Information (“RFI”) to Mr. Warnock. After obtaining an extension of time to respond, Mr. Warnock provided an incomplete response.
On August 20, 2015, OED sent a second RFI (“Second RFI”) to Mr. Warnock. In the Second RFI, OED asked follow-up questions in response to Mr. Warnock’s response to the First RFI and also requested that he respond to the questions that he had not answered from the First RFI. Mr. Warnock failed to respond to the Second RFI.
Mr. Warnock was served with a copy of the OED’s complaint, but failed to respond. In January 2016, the OED Director moved for entry of default judgment. No response was filed. Accordingly, the ALJ entered an initial decision granting the default judgment motion. The initial decision noted that since Mr. Warnock had failed to respond to the complaint, the allegations were accepted as true.
The ALJ’s initial decision found based upon the undisputed facts that Mr. Warnock had breached ethical duties under the USPTO’s Code of Professional Responsibility (for conduct pre-dating May 4, 2013) and the USPTO’s Rules of Professional Conduct (for conduct on or after May 4, 2013). In particular, the ALJ found Mr. Warnock violated the following ethics rules:
- 37 C.F.R. § 10.23(a) for engaging in disreputable or gross misconduct by failing to perform services that he was retained to perform on behalf of a client.
- 37 C.F.R. §§ 10.23(a) and (b) via 10.23(c)(2)(1) for knowingly giving false or misleading information or knowingly participating in a material way in giving false or misleading information to a client in connection with any immediate, prospective or pending business before the Office.
- 37 C.F.R §§ 10.23(a) and (b) via 10.23(c)(8) for failing to inform a client of correspondence received from the Office when the correspondence could have a significant effect on a matter pending before the Office, is received by the practitioner on behalf of a client, and is correspondence which a reasonable practitioner would believe under the circumstances that the client should be notified.
- 37 C.F.R. § 10.77(c) for neglecting a legal matter entrusted to the practitioner.
- 37 C.F.R. § 11.101 for failing to provide competent representation to a client.
- 37 C.F.R. § 11.103 for failing to act with reasonable diligence and promptness in representing a client.
- 37 C.F.R. § 11.104(a)(2) and (3) for failing to keep the client reasonably informed about the status of the matter.
- 37 C.F.R. § 11.804(c) for engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation.
Interestingly, the ALJ did not find that Mr. Warnock violated the USPTO’s disciplinary rules that require a practitioner to assist in a disciplinary proceeding. See 37 C.F.R. § 11.801(b) (proscribing knowingly failing to respond to lawful demands for information from a disciplinary authority). Nevertheless, the ALJ did consider his failure to cooperate to be an aggravating factor warranting enhanced discipline. The ALJ concluded by recommending that Mr. Warnock be excluded from practice before the USPTO.
Because the practitioner failed to appeal, the ALJ’s initial decision became the USPTO’s final decision as a matter of law, and thus the practitioner was excluded.