In re Bang-er Shia, Proc. No. D2014-31 (USPTO Dir. Mar. 4, 2016)

Michael E. McCabe, Jr.Misrepresentation, UPL, USPTO

Disposition: Initial decision recommending patent practitioner’s exclusion from practice before the USPTO affirmed on appeal in a final decision issued by the USPTO Director. The USPTO Director denied the practitioner’s subsequent request for reconsideration of the Agency’s final decision.  Final decision here, and decision denying reconsideration request here.

Summary: The USPTO Director issued an Order affirming an administrative law judge’s initial decision recommending the exclusion of a patent agent who had engaged for years in the practice of trademark law before the USPTO. The USPTO Director found that the patent agent engaged in misconduct by: (1) improperly signing trademark documents filed with the USPTO; (2) improperly filing trademark documents prepared by foreign attorneys; (3) exceeding the role of a domestic representative and practicing before the Office in trademark matters; and (4) continuing to act as a domestic representative after being excluded from doing so by the Trademark Commissioner. The USPTO Director affirmed an ALJ’s determination that the practitioner violated six (6) ethics rules and properly considered the factors required by 37 C.F.R. § 11.54(b) before concluding that a sanction of exclusion was appropriate. The USPTO Director subsequently denied the patent agent’s request for reconsideration.

Related Decisions:  Reconsideration denied, In re Bang-er Shia, Proc. No. D2014-31 (USPTO Dir. Aug. 1, 2016)

Facts: This case involves a patent agent who exceeded her limited authority by filing and signing trademark documents. The decision reminded that documents filed in connection with a trademark application or registration must be signed by a proper person.

For example, trademark documents that require a verification of the facts, such as an initial application or Statement of Use, must be sworn to in a declaration that is signed by the owner or the owner’s authorized representative. A person properly authorized to sign a declaration on behalf of an owner is either (i) a person with legal authority to bind the owner (e.g., a corporate officer or general partner of a partnership); (ii) a person with firsthand knowledge of the facts and actual or implied authority to act on behalf of the owner; or (iii) an attorney with a power of attorney from the owner. A person who does not satisfy one of these three requirements cannot sign a trademark document on behalf of an owner. A person may not electronically sign another person’s name to a trademark document and file that document with the Office.

Bang-er Shia became a registered patent agent in 2005; she has never been admitted to the bar of any court as an attorney. Ms. Shia began serving as a domestic representative and correspondent for foreign trademark applicants in 2005 or 2006. She entered the electronic signatures of her clients on those filings and personally filed the documents with the USPTO. She would use her own address as the correspondence address and would sign the name of another individual as the owner’s “domestic representative” on applications and other documents filed in the Office. Ms. Shia was never an officer or owner of any of these entities.

On January 23, 2012, the Trademark Commissioner issued a Show Cause Order to Ms. Shia informing her that USPTO suspected her of engaging in the unauthorized practice of trademark law before the USPTO, and was considering issuing an exclusion order. Ms. Shia responded to the Show Cause Order on February 2, 2012, stating that she merely provided administrative support for applicants by serving as their correspondent or domestic representative. On February 21, 2013, the Commissioner found that Ms. Shia had engaged in unauthorized practice in trademark matters before the USPTO and excluded her from participating as a correspondent or domestic representative in any current or future trademark matters before the USPTO. The basis for that Exclusion Order was a finding that Ms. Shia engaged in the unauthorized practice of law before the USPTO by preparing and signing trademark applications and other documents. On December 27, 2013, the USPTO Director affirmed the Commissioner’s decision.

Ms. Shia continued assisting with trademark documents in violation of the Exclusion Order. On November 8, 2013, the OED Director filed a Complaint and Notice of Proceedings under 35 U.S.C. § 32 against Ms. Shia, captioned Proceeding No. D2014-04. On March 25, 2014, the OED Director filed an Amended Complaint in Proceeding No. D2014- 04.

On June 27, 2014, the OED Director filed a second Complaint against Ms. Shia, Proceeding No. D2014-31. At the OED Director’s request, the two cases were consolidated. On July 22, 2014, the OED Director filed an Amended Complaint in D2014-31 (“Amended Complaint”), which removed certain charges and clarified others, and the matter was scheduled for a hearing.

The Amended Complaint in D2014-31 alleged that Ms. Shia, who is not and never has been an attorney, went beyond acting as a domestic representative for foreign applicants and engaged in unauthorized practice in trademark matters before the Office. The Amended Complaint further alleged she forged the electronic signatures of applicants to trademark documents and filed those documents with the USPTO and continued doing so even after being excluded by the Commissioner and to have concealed her misconduct by using an e-mail or mailing address that had not yet been detected by the USPTO as being associated with her. Ms. Shia was further alleged to have actively assisted foreign attorneys in the unauthorized practice of trademark law.

On August 20, 2014, Ms. Shia filed an Answer and Counterclaim to the Amended Complaint, denying the allegations and raising a number of affirmative defenses. On October 1, 2014, the OED Director filed a Motion to Dismiss D2014-04, electing to proceed to trial only on the allegations asserted in D2014-31. The Motion to Dismiss D2014-04 was granted by the ALJ on the first day of the hearing. The hearing proceeded based solely upon the Amended Complaint filed July 22, 2014 in D2014-31.

An evidentiary hearing was conducted in October 2014. On April 22, 2015, the ALJ issued an Initial Decision and Order in Proceeding No. D2014-31. In that decision, the ALJ found that Ms. Shia’s actions regarding documents filed in connection with nine (9) trademark applications constituted misconduct in four (4) ways: (1) she improperly signed trademark documents filed with the USPTO; (2) she improperly filed trademark documents prepared by foreign attorneys; (3) she went beyond the role of a domestic representative and constituted practice before the Office in trademark matters; and (4) she continued to act as a domestic representative after being excluded from doing so by the Trademark Commissioner. The ALJ concluded that Ms. Shia’s misconduct violated the following USPTO disciplinary rules: 37 C.F.R. § 10.23(a) (disreputable conduct); § 10.23(b)(4) (deceit and misrepresentations to the USPTO); § 11.804(c) (deceit and misrepresentations to the USPTO); § 11.303(a)(l) (failure to correct misrepresentations made to the Office); § 10.77(a) (handling matters she was not competent to handle); 11.505 (aiding others in the unauthorized practice of law); and § 10.23(b)(5) and § 11.804(d) (conduct prejudicial to the administration of justice). The ALJ rejected Ms. Shia’s affirmative defenses as well as her constitutional, jurisdictional, and regulatory arguments in their entirety.

Ms. Shia challenged the USPTO’s authority to discipline her. Those arguments were unavailing. The USPTO Director explained that Congress vested the USPTO with plenary, statutory authority to promulgate regulations “govern[ing] the recognition and conduct of agents, attorneys, or other persons representing applicants or other parties before the Office.” 35 U.S.C. § 2(b)(2)(D); see also Kroll v. Finnerty, 242 F.3d 1359, 1364 (Fed. Cir. 2001) (stating that the USPTO has the “exclusive authority to establish qualifications for admitting persons to practice before it, and to suspend or exclude them from practicing before it”). The Director of the USPTO may suspend or exclude a person from practice before the Patent and Trademark Office if the person is “shown to be incompetent or disreputable, or guilty of gross misconduct,” or if the person violates regulations established by the Office. 35 U.S.C. § 32. Thus, there is no question that the USPTO Director has authority to regulate practice before the Office in both patent and trademark matters, including the unauthorized practice of law before the Office.

The USPTO Director found that, “Pursuant to its authority to regulate the conduct of practitioners, the USPTO enacted its former Code of Professional Responsibility, 37 C.F.R. § 10.20 et seq., and the current Rules of Professional Conduct, 37 C.F.R. §§ 11.101 through 11.901, both of which include a number of mandatory disciplinary rules setting forth the minimum level of conduct below which no registered patent practitioner can fall without being subjected to disciplinary action. If a registered patent practitioner engages in misconduct and/or fails to comply with his or her professional obligations in violation of these rules, the USPTO has the authority to suspend or exclude the practitioner from further practice before the Office.” See 35 U.S.C. § 32; 37 C.F.R. § 11.19.

The Director thus rejected Ms. Shia’s argument that violations of the Trademark rules and TMEP cannot form the basis of a disciplinary action: “It is well-settled that a practitioner is subject to the Office’s disciplinary jurisdiction for misconduct that is not specifically set forth in the disciplinary rules.” (citing In re Edington, Proc. No. D2008-12 (USPTO July 9, 2009) (finding the Respondent’s manslaughter conviction to be sufficient evidence that the respondent engaged in disreputable or gross misconduct in violation of the USPTO’s disciplinary rules); In re Reynolds, Proceeding No. Dl999-12, at 19 (USPTO Apr. 4, 2001) (find Respondent’s convictions for driving while intoxicated represent conduct adversely reflecting on his fitness to practice law in violation of 37 C.F.R. § 10.23(b)).

The Director further rejected the argument that state law, rather than federal law, applied to Ms. Shia’s practice before the Office as being without any legal foundation. The Director ruled that it is long-settled that regulating admission and disciplinary issues before the USPTO lies within USPTO’s exclusive jurisdiction. See Sperry v. Florida ex rel. Florida Bar, 373 U.S 379, 385-86 (1963) (Registration with the USPTO confers a right to practice before the Office without regard to whether a state within which the practice is conducted would otherwise prohibit such conduct); see also Kroll, 242 F.3d at 1364 (“[T]he PTO has exclusive authority to establish qualifications and procedures for admitting persons to practice before the PTO, and to suspend or exclude those patent practitioners from practicing before the PTO.”)

Request for Reconsideration

Ms. Shia timely filed a request for reconsideration of the USPTO Director’s decision. The USPTO Director explained the very high burden of such requests. Applying the standard applicable in federal court for motions for new trial, the USPTO Director stated:

Federal courts have clarified that the standard of review for Rules 59(c) and 60 are narrow and limited to only certain circumstances involving new evidence, or to correct errors or Jaw or fact. See Hutchinson v. Staton, 994 F.2d 1076, 1081 (4th Cir. 1993). Any new evidence submitted must not have been available before the issuance of the final decision. See Baryon v. United States, 884 F.2d 767, 771 (4th Cir. 1989) (“Evidence that is available to a party prior to entry of judgment, therefore, is not a basis for granting a motion for reconsideration as a matter of law.”) (quoting Frederick S Wyle P.C v. Texaco, Inc., 764 F.2d 604, 609 (9th Cir. 1985)). Reconsideration “would be appropriate where, for example, the Court has patently misunderstood a party, or has made a decision outside the adversarial issues presented to the Court by the parties, or has made an error not of reasoning but of apprehension.” Above the Belt, Inc. v. Mel Bohannan Roofing, Inc., 99 F.R.D. 99, 101 (E.D. Va. 1983); United States v. Ali, No. 13-3398, 2014 WL 5790996, at *3 (D.Md. Nov. 5, 2014).

The USPTO Director further explained that it “is long-settled that requests for reconsideration are not a vehicle to state a party’s disagreement with a final judgment” and should not be used to rehash “arguments previously presented” or to submit evidence which should have been previously submitted. The USPTO Director noted that while requests for reconsideration are permitted, they are seldom granted. “These types of motions are extraordinary remedies reserved only for extraordinary circumstances.”

After stating the standard, the USPTO Director determined that Ms. Shia had failed to meet the standard. The USPTO Director found that Ms. Shia failed to present any newly discovered evidence, or identify errors in law or fact that support her argument that the Final Order warrants dismissal.