Disposition: Four (4)-month suspension from practice before the USPTO. Final decision here.
Summary: A registered patent attorney was suspended from practice before the USPTO for violation of numerous USPTO Disciplinary rules arising from his representation of a client in various trademark matters. The attorney’s conduct involved willful misconduct, including collecting unearned legal fees and USPTO filing fees paid by a client and converting them for his benefit; misrepresenting to the client that the work had been performed and providing the client with eight (8) fictitious trademark application numbers as representative of the client’s application numbers; continuing the representation of a client during a period in which his physical conditions made it unreasonably difficult for him to carry out his duties to the client; failing to perform the work he was hired to do; failing to promptly return to the client legal fees for the work not performed and USPTO fees not used upon being asked to do so by the client; and failing to deposit the legal fees for the work not performed in an identifiable bank account, such as a trust account. In addition, the practitioner was disciplined on ethical grounds for the same misconduct by another disciplinary authority. The practitioner submitted evidence of substantial mitigating factors which bore significant weight in reducing the practitioner’s term of suspension.
Facts: This matter arises from a patent practitioner’s misappropriation of client funds and misrepresentations to his client regarding various trademark applications he claimed to have filed but which he had not in fact filed. Although the nature of the misconduct was quite serious, this case also presented some unusual mitigating circumstances which supported imposition of a lesser disciplinary sanction. The practitioner, Everitt George Beers, of California, was first investigated by the California State Bar for his misconduct.
Related Case: In re Beers, Proc. No. 13-0-12153 (Cal. Oct. 28, 2014)
California Discipline
Mr. Beers, who has been admitted to practice law in California since 1980, stipulated that between December 21, 2011 and November 15, 2012, he misappropriated $2,600 he had been paid to cover filing fees for eight (8) trademark applications. He then submitted a list to the client suggesting he had prepared and filed the trademark applications when he had not. He also received $5,005 in advanced fees from the client for preparing and filing the applications but did not promptly refund the money. Mr. Beers also did not file a response to a complaint filed against him with the State Bar. In May and March of 2014, Beers refunded the money he owed plus interest.
The California Bar found that Mr. Beers violated the California ethics rules by (1) failing to deposit any of the advanced costs received from the client in a trust account; (2) committing acts involving moral turpitude, dishonesty or corruption in willful violation by misappropriating the advanced costs paid by the client; (3) committing an act involving moral turpitude, dishonesty or corruption by submitting the client a false list of eight (8) trademark applications with the USPTO when he knew that he had not; (4) failing to promptly return part of the unearned fee upon request by the client; and (5) failing to provide any response to the State Bar’s investigatory letter, and thus failing to cooperate in a disciplinary proceeding.
The California Bar found that, in mitigation, Mr. Beers was experiencing family problems and physical difficulties at the time of his misconduct, he had no prior record of discipline, he showed remorse, and he entered into a pretrial stipulation with the State Bar.
Mr. Beers was suspended for six (6) months, ordered to take the MPRE, and placed on two (2) years’ probation by the State Bar of California. The order took effect in May 2015.
USPTO Discipline
The USPTO agreed to the same findings of fact and conclusions of law that had been found by the California State Bar. Interestingly, the OED Director failed to follow 37 C.F.R. § 11.24(a) and (d), which would have mandated imposing upon Mr. Beers the “identical” discipline that he received in California.
The USPTO concluded based upon his conduct that Mr. Beers violated the following provisions of the USPTO Code of Professional Responsibility:
- 37 C.F.R. § 10.23(b)(4), which proscribes engaging in conduct involving dishonesty, fraud, deceit or misrepresentation, and 37 C.F.R. § 10.23(b)(6), which proscribes engaging in other conduct that adversely reflects on the practitioner’s fitness to practice, by taking unearned legal fees and USPTO fees paid by a client and converting them for Respondent’s benefit and by misrepresenting to the client that the work had been performed while submitting eight (8) fictitious trademark application numbers as representative of the client’s application numbers;
- 37 C.F.R. § 10.40(b)(3), which requires a practitioner to withdraw from employment when the practitioner’s mental or physical condition renders it unreasonably difficult for the practitioner to carry out the employment effectively, by continuing the representation of a client during a period in which his physical conditions made it unreasonably difficult for practitioner to carry out his duties to the client;
- 37 C.F.R. § 10.84(a), which proscribes a practitioner from intentionally failing to seek the lawful objectives of a client through reasonably available means, intentionally failing to carry out a contract of employment entered into with a client for professional services, and intentionally prejudicing or damaging a client during the course of a professional relationship, by failing to perform the work that Mr. Beers was hired to do (filing eight (8) trademark applications), and by collecting legal fees and USPTO fees for such unperformed work and then failing to promptly return to the client legal fees for the work not performed and USPTO fees not used;
- 37 C.F.R. § 10.112(a), which requires a practitioner to deposit funds of clients paid to a practitioner or a practitioner’s firm, except advances for costs or expenses, into identifiable bank accounts, by failing to deposit the legal fees for the work not performed into an identifiable bank account, such as a trust account; and
- 37 C.F.R. § 10.l12(c)(4), which requires a practitioner to promptly pay or deliver to the client as requested by a client the funds, securities, or other properties in the possession of the practitioner that the client is entitled to receive, by failing to promptly return to the client legal fees for the work not performed and USPTO fees not used.
In this case, the USPTO’s failure to follow its rules mandating reciprocal discipline benefited the practitioner. Indeed, instead of the practitioner receiving from the USPTO identical discipline to what was imposed in California (a six (6)-month suspension and two (2)-year probationary term), the USPTO determined that a four (4)-month term of actual suspension from the USPTO was warranted. The USPTO found the following mitigating circumstances:
- On or about August 22, 2011, evidence of a serious medical condition was first detected in Mr. Beers after his hospitalization for injuries suffered in a biking accident. As a result of the accident, he suffered chest injuries (which required placement of a tube in the chest wall) and a fractured collarbone. After the serious medical condition was detected, treatment for that condition began in September 2011 and lasted at least through July 2014;
- In the fall of 2012, Mr. Beers’ wife suffered a serious biking accident in which she shattered a shoulder and required extensive surgery to implant a metal plate to hold nine (9) broken bone pieces together. After her release from the hospital, Mr. Beers was his wife’s primary caregiver;
- In May 2013, Mr. Beers’ 94-year-old father, who was responsible for Mr. Beers’ developmentally disabled sister—both of whom resided in Alaska—fell and broke his hip requiring surgery. Mr. Beers’ father had to be hospitalized and he was no longer able to supervise his disabled sister. Thereafter, Mr. Beers had to make several trips to Alaska to oversee care for his father and sister; and
- Mr. Beers sought and obtained psychological counseling regarding his misappropriation of funds and misrepresentations to this client prior to being contacted by the California State Bar and by OED, and within two (2) weeks of being confronted by the client, demonstrated remorse and recognition of wrongdoing, which were steps designed to atone for the consequences of his misconduct. His psychologist opined that he will not reoffend. Mr. Beers also attended Lawyers Assistance Program meetings and made full restitution.