Bar Counsel Imposes Discipline For “Personal” Misconduct & Legal But Unethical Behavior

Michael E. McCabe, Jr.Patent Ethics, PTO Ethics Decisions, PTO Ethics Rules, USPTO Director Decisions, USPTO OEDLeave a Comment

5335570Many members of the public, and some attorneys themselves, believe that if they do not lie, they do not steal, and they do not cheat, then their conduct necessarily complies with the Rules of Professional Conduct.  This is a false assumption.  Others believe that an attorney’s “transgressions” in her personal life will not affect her ability to practice law.  This too is incorrect.

The preamble to the ABA model rules explains that the “legal profession’s relative autonomy carries with it special responsibilities of self-government. The profession has a responsibility to assure that its regulations are conceived in the public interest and not in furtherance of parochial or self-interested concerns of the bar. Every lawyer is responsible for observance of the Rules of Professional Conduct.”

The rules further warn that “[n]eglect of these responsibilities compromises the independence of the profession and the public interest which it serves.”

Personal Misconduct 

Lying, cheating and stealing are proscribed by numerous canons of ethics.  Moreover, the ethics rules apply regardless of whether the misconduct occurs in the context of the practice of law.

For example, lawyers who may be perfectly good, even great, at their craft may still be suspended or disbarred for breaking the law.  Convictions for any felony as well as anything that reflects negatively on the lawyer’s honesty, character, or integrity, whether the result of conduct at work or at home, subjects the attorney to professional discipline.

The Bar does not just regulate the quality of a lawyer as a client representative.  Character matters.  Alot.  Illegal, dishonest, or other conduct that tarnishes the image of the legal profession is fair game for Bar Counsel.  As reported in this blog, the United States Patent and Trademark Office has suspended or disbarred practitioners for all types of “private misconduct,” such as domestic violence, solicitation of a minor, and failure to pay child support or taxes.

Legal But Unethical Conduct

The ethical rules also cover other conduct that may be perfectly legal and yet still subject counsel to significant professional discipline.  One example is the “simple mistake.”  Ethical guidance on what seems to be a straightforward question is mixed.  

get-out-of-jail-freeTake the typo.  No one is going to jail for an unintentional misspelling.  A “typo” could easily be characterized as a “simple” mistake.  But what if the typo caused the client to miss a non-extendable filing date, resulting in the lapse of valuable patent rights?  Ethical or not?

The USPTO’s Office of Enrollment and Discipline (OED) has imposed fairly significant discipline against patent and trademark practitioners whose arguably “simple” mistake of failing to timely pay maintenance fees led to the unintended loss of client patent rights.  For example, in In re Brufsky, a patent attorney received a multi-year suspension because his staff erroneously determined the client was responsible for payment of maintenance fees.

In another “mistake” case, In re Druce (discussed here), the OED disciplined a named partner in an IP firm for failing to “adequately” supervise a paralegal.  Such conduct could very well be characterized as “simple mistakes,” and is certainly not illegal conduct.  Yet the purported “simplicity” of the “mistake” provided no defense to the OED’s charges.

Another type of conduct that is legal, yet unethical, is the lawyer’s duty to communicate.  The Rules of Professional Conduct governing USPTO practitioners state “a practitioner shall . . . keep the client reasonably informed about the progress of the matter” and “promptly comply with reasonable requests for information from the client.” 37 C.F.R. § 11.104(a)(3) & (4). The ethics rules also impose a duty to “act with reasonable diligence and promptness in representing a client.” 37 C.F.R. § 11.103.  Again, no crime and yet disciplinary authorities will not hesitate from sanctioning attorneys for such violations, as discussed in our posting here.

Another type of conduct that falls under the heading of “legal but unethical” relates to an attorney’s handling of their client’s money and other property.  For example, counsel owes a duty to maintain their client’s property separate from the practitioner’s property, maintain proper trust account records, and ensure that trust funds are properly balanced. 37 C.F.R. § 11.115.  If the attorney fails to keep proper accounting records or mishandles client funds, even if unintentional, she could be sanctioned by the bar.

Legal but unethical conduct was discussed in a Colorado bar ethics opinion regarding whether an error (not illegal) could still constitute unethical behavior.  The conclusion?  It depends.  As the bar opinion advised, “professional errors exist along a spectrum.” At one end are errors that “will likely prejudice a client’s right or claim. Examples of these kinds of errors are the loss of a claim for failure to file it within a statutory limitations period or a failure to serve a notice of claim within a statutory time period.”  At the other end of the spectrum are errors that may never cause harm to the client, either because any resulting harm is not reasonably foreseeable, there is no prejudice to a client’s right or claim, or the lawyer takes corrective measures that are reasonably likely to avoid any such prejudice. “For example, missing a nonjurisdictional deadline, a potentially fruitful area of discovery, or a theory of liability or defense may constitute grounds for loss of sleep, but not an ethical duty to disclose to the client.”

USPTO practitioners must keep their clients “reasonably informed about the status of the matter.”  37 C.F.R. § 11.104(a)(3).  Counsel must also inform their client of “any decision or circumstance with respect to which the client’s informed consent is required by the USPTO Rules of Professional Conduct.”  Id. at § 11.104(a)(1). The duty to keep a client “reasonably informed” requires disclosure regarding  “significant developments” in the matter.  Not surprisingly, the duty to inform the client regarding “significant developments” includes the duty to disclose material adverse developments, including those caused by the attorney’s own error.  Again, violations of these rules, which arise from legal conduct, may result in professional discipline.

The duties that lawyers owe are far more expansive than simply not violating the law.  As the preamble to the ABA Model Rules explains, “A lawyer, as a member of the legal profession, is a representative of clients, an officer of the legal system and a public citizen having special responsibility for the quality of justice.”  Private misconduct outside of the practice of law, as well as legal conduct that violates the rules of ethics, can lead to serious disciplinary sanctions.

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