Monthly Archives

September 2018

U.S. Court Of Appeals For Veterans Claims Holds, For First Time, It May Decide Class Action Certification Issues

By | Class Action Lawsuits

In its Order dated August 23, 2018, the United States Court Of Appeals For Veterans Claims (“Court”) determined, for the first time,  that it has authority to conduct limited factfinding to determine whether class certification is warranted, stating: “An integral part of the Court’s exercise of its authority to issue writs on an aggregate basis includes the authority to conduct the limited factfinding needed to decide whether the petitioners and putative class members satisfy this Court’s requirements to certify a class and to further decide the merits of the underlying petition. Accordingly, limited factfinding in the context of class certification in petitions for extraordinary relief does not run afoul of the prohibition of section 7261(c) that the Court shall not make de novo findings of fact when it reviews the merits of a final Board decision.”

The Court stated: “the Court will use Rule 23 of the Federal Rules of Civil Procedure as a guide for considering whether to grant the petitioners’ motion for class certification. Class relief is appropriate when the class shares issues that are common to the class as a whole and when the questions of law apply in the same manner to each class member … In such  cases, the class-action device saves the resources of both the courts and the parties by permitting an issue potentially affecting every [class member] to be litigated in an economical fashion.”

The petitioners in the case the Court was deciding defined the proposed class as consisting of all individuals who applied for and have been denied VA disability compensation benefits and have not received a decision from the Board of Veterans’ Appeals (Board) within 12 months of the date of filing a timely Notice of Disagreement  (NOD).

In the case it was deciding, the Court stated: “we conclude that there is no common question for the petitioners’ and putative class’s cause of delay, the answer to which will resolve an issue that is central to the validity of each one of the [class member’s] claims … Therefore, we conclude that, because the petitioners have not satisfied the commonality requirement, the Court need not address the remaining Rule 23(a) prerequisites … [furthermore,] [h]ere, the relief proposed by the petitioners does not satisfy Rule 23(b)(2) because it would require that the remedy be individualized and tailored to the needs of the individual veteran. This kind of relief would not truly be classwide. The relief the petitioners seek does not satisfy Rule 23(b)(2)’s standard as there is no single injunction that provides relief to the class as a whole.”

In a concurring opinion, the Chief Judge of the Court stated: “In the precedential parts of its decision, the Court holds that it will, in appropriate cases, entertain class actions. This holding is a seismic shift in our precedent, departing from nearly 30 years of this Court’s case law. The fact that the Court did not find aggregate action appropriate in this case does not change the fact that this is a watershed decision, and its importance should not be diminished merely because the Court declined to certify this proposed class. On the contrary, the Court’s decision will shape our jurisprudence for years to come and, I hope, bring about positive change for our Nation’s veterans and ensure that justice is done more efficiently and timely.”

Source

Monk v. Wilkie, Secretary of the Department of Veterans Affairs, No. 15-1280.

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Mastercard Reaches Agreement To Settle Monetary Damages Related To U.S. Merchant Class-Action Litigation

By | Class Action Lawsuits

Mastercard has reached an agreement to settle monetary damages claims in the U.S. merchant class-action litigation. The agreement formalizes prior discussions and has been executed by all of the defendants – including Mastercard, Visa and a number of banks – and the court-appointed class counsel for the merchants.

The settlement is an amendment to the financial terms of the 2012 Class Settlement Agreement and will be filed with the court seeking approval.

“We are taking a significant step toward closing a chapter in a long-standing case,” said Tim Murphy, general counsel, Mastercard. “We can put this behind us and focus on continuing to innovate with our merchant partners to deliver the experience and convenience that consumers expect.”

In addition to the original 2012 monetary terms, Mastercard’s share of the financial agreement is an additional $108 million, which is based upon the allocation of financial responsibility that was set out in the judgment and settlement sharing agreements that were executed in February 2011. In total, the defendants have agreed upon an additional payment of $900 million in the current agreement.

The company recorded a $210 million charge in its second-quarter 2018 financial statements, which will cover the financial obligation under this agreement and for estimated liabilities related to filed and anticipated opt-out merchant cases.

The merchant class-action that seeks the revision of network rules is not covered by this settlement agreement. That action remains outstanding while the parties are engaged in settlement negotiations.

After court approval of the monetary agreement, Mastercard and its customer financial institutions will receive a release of all monetary claims alleged by the merchant class members concerning the company’s interchange and fee structure and merchant acceptance rules. This release covers all previous, as well as future claims, for a period of five years after resolution of all appeals.

Source

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Federal Class Action Lawsuits – Continued

By | Business Litigation, Class Action Lawsuits

The United States Supreme Court stated in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), that Rule 23 does not set forth a mere pleading standard. A party seeking class certification must affirmatively demonstrate his compliance with the Rule—that is, he must be prepared to prove that there are in fact sufficiently numerous parties, common questions of law or fact, etc.

Class certification is governed by Federal Rule of Civil Procedure 23. Under Rule 23(a), the party seeking certification must demonstrate, first, that:

“(1) the class is so numerous that joinder of all members is impracticable,

“(2) there are questions of law or fact common to the class,

“(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and

“(4) the representative parties will fairly and adequately protect the interests of the class” (paragraph breaks added).

Second, the proposed class must also satisfy at least one of the three requirements listed in Rule 23(b).  Rule 23(b)(2) applies when “the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.”

In a prior decision, the Supreme Court rejected a composite class for lack of commonality and typicality, explaining: “Conceptually, there is a wide gap between (a) an individual’s claim that he has been denied a promotion [or higher pay] on discriminatory grounds, and his otherwise unsupported allegation that the company has a policy of discrimination, and (b) the existence of a class of persons who have suffered the same injury as that individual, such that the individual’s claim and the class claim will share common questions of law or fact and that the individual’s claim will be typical of the class claims.”102 S.Ct. 2364.

In the present case, the Supreme Court stated that the crux of the case is commonality—the rule requiring a plaintiff to show that “there are questions of law or fact common to the class.” Rule 23(a)(2). The Supreme Court stated “the mere claim by employees of the same company that they have suffered a Title VII injury, or even a disparate-impact Title VII injury, gives no cause to believe that all their claims can productively be litigated at once. Their claims must depend upon a common contention—for example, the assertion of discriminatory bias on the part of the same supervisor. That common contention, moreover, must be of such a nature that it is capable of classwide resolution—which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.”

The Supreme Court continued: “The only corporate policy that the plaintiffs’ evidence convincingly establishes is Wal-Mart’s “policy” of allowing discretion by local supervisors over employment matters. On its face, of course, that is just the opposite of a uniform employment practice that would provide the commonality needed for a class action; it is a policy against having uniform employment practices. It is also a very common and presumptively reasonable way of doing business—one that we have said “should itself raise no inference of discriminatory conduct” … Respondents have not identified a common mode of exercising discretion that pervades the entire company … In sum, we agree … that the members of the class: “held a multitude of different jobs, at different levels of Wal-Mart’s hierarchy, for variable lengths of time, in 3,400 stores, sprinkled across 50 states, with a kaleidoscope of supervisors (male and female), subject to a variety of regional policies that all differed …. Some thrived while others did poorly. They have little in common but their sex and this lawsuit.”

The Supreme Court further held that Rule 23(b)(2) applies only when a single injunction or declaratory judgment would provide relief to each member of the class. It does not authorize class certification when each individual class member would be entitled to a different injunction or declaratory judgment against the defendant. Similarly, it does not authorize class certification when each class member would be entitled to an individualized award of monetary damages.

Source

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Federal Class Action Lawsuits

By | Class Action Lawsuits

Federal Rules of Civil Procedure, Rule 23, deals with federal class action lawsuits and states:

Rule 23 – Class Actions

(a) Prerequisites. One or more members of a class may sue or be sued as representative parties on behalf of all members only if:

(1) the class is so numerous that joinder of all members is impracticable;

(2) there are questions of law or fact common to the class;

(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and

(4) the representative parties will fairly and adequately protect the interests of the class.

(b) Types of Class Actions. A class action may be maintained if Rule 23(a) is satisfied and if:

(1) prosecuting separate actions by or against individual class members would create a risk of:

(A) inconsistent or varying adjudications with respect to individual class members that would establish incompatible standards of conduct for the party opposing the class; or

(B) adjudications with respect to individual class members that, as a practical matter, would be dispositive of the interests of the other members not parties to the individual adjudications or would substantially impair or impede their ability to protect their interests;

(2) the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole; or

(3) the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. The matters pertinent to these findings include:

(A) the class members’ interests in individually controlling the prosecution or defense of separate actions;

(B) the extent and nature of any litigation concerning the controversy already begun by or against class members;

(C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and

(D) the likely difficulties in managing a class action.

(c) Certification Order; Notice to Class Members; Judgment; Issues Classes; Subclasses.

(1) Certification Order.

(A) Time to Issue. At an early practicable time after a person sues or is sued as a class representative, the court must determine by order whether to certify the action as a class action.

(B) Defining the Class; Appointing Class Counsel. An order that certifies a class action must define the class and the class claims, issues, or defenses, and must appoint class counsel under Rule 23(g).

(C) Altering or Amending the Order. An order that grants or denies class certification may be altered or amended before final judgment.

(2) Notice.

(A) For (b)(1) or (b)(2) Classes. For any class certified under Rule 23(b)(1) or (b)(2), the court may direct appropriate notice to the class.

(B) For (b)(3) Classes. For any class certified under Rule 23(b)(3), the court must direct to class members the best notice that is practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort. The notice must clearly and concisely state in plain, easily understood language:

(i) the nature of the action;

(ii) the definition of the class certified;

(iii) the class claims, issues, or defenses;

(iv) that a class member may enter an appearance through an attorney if the member so desires;

(v) that the court will exclude from the class any member who requests exclusion;

(vi) the time and manner for requesting exclusion; and

(vii) the binding effect of a class judgment on members under Rule 23(c)(3).

(3) Judgment. Whether or not favorable to the class, the judgment in a class action must:

(A) for any class certified under Rule 23(b)(1) or (b)(2), include and describe those whom the court finds to be class members; and

(B) for any class certified under Rule 23(b)(3), include and specify or describe those to whom the Rule 23(c)(2) notice was directed, who have not requested exclusion, and whom the court finds to be class members.

(4) Particular Issues. When appropriate, an action may be brought or maintained as a class action with respect to particular issues.

(5) Subclasses. When appropriate, a class may be divided into subclasses that are each treated as a class under this rule.

(d) Conducting the Action.

(1) In General. In conducting an action under this rule, the court may issue orders that:

(A) determine the course of proceedings or prescribe measures to prevent undue repetition or complication in presenting evidence or argument;

(B) require—to protect class members and fairly conduct the action—giving appropriate notice to some or all class members of:

(i) any step in the action;

(ii) the proposed extent of the judgment; or

(iii) the members’ opportunity to signify whether they consider the representation fair and adequate, to intervene and present claims or defenses, or to otherwise come into the action;

(C) impose conditions on the representative parties or on intervenors;

(D) require that the pleadings be amended to eliminate allegations about representation of absent persons and that the action proceed accordingly; or

(E) deal with similar procedural matters.

(2) Combining and Amending Orders. An order under Rule 23(d)(1) may be altered or amended from time to time and may be combined with an order under Rule 16.

(e) Settlement, Voluntary Dismissal, or Compromise. The claims, issues, or defenses of a certified class may be settled, voluntarily dismissed, or compromised only with the court’s approval. The following procedures apply to a proposed settlement, voluntary dismissal, or compromise:

(1) The court must direct notice in a reasonable manner to all class members who would be bound by the proposal.

(2) If the proposal would bind class members, the court may approve it only after a hearing and on finding that it is fair, reasonable, and adequate.

(3) The parties seeking approval must file a statement identifying any agreement made in connection with the proposal.

(4) If the class action was previously certified under Rule 23(b)(3), the court may refuse to approve a settlement unless it affords a new opportunity to request exclusion to individual class members who had an earlier opportunity to request exclusion but did not do so.

(5) Any class member may object to the proposal if it requires court approval under this subdivision (e); the objection may be withdrawn only with the court’s approval.

(f) Appeals. A court of appeals may permit an appeal from an order granting or denying class-action certification under this rule if a petition for permission to appeal is filed with the circuit clerk within 14 days after the order is entered. An appeal does not stay proceedings in the district court unless the district judge or the court of appeals so orders.

(g) Class Counsel.

(1) Appointing Class Counsel. Unless a statute provides otherwise, a court that certifies a class must appoint class counsel. In appointing class counsel, the court:

(A) must consider:

(i) the work counsel has done in identifying or investigating potential claims in the action;

(ii) counsel’s experience in handling class actions, other complex litigation, and the types of claims asserted in the action;

(iii) counsel’s knowledge of the applicable law; and

(iv) the resources that counsel will commit to representing the class;

(B) may consider any other matter pertinent to counsel’s ability to fairly and adequately represent the interests of the class;

(C) may order potential class counsel to provide information on any subject pertinent to the appointment and to propose terms for attorney’s fees and nontaxable costs;

(D) may include in the appointing order provisions about the award of attorney’s fees or nontaxable costs under Rule 23(h); and

(E) may make further orders in connection with the appointment.

(2) Standard for Appointing Class Counsel. When one applicant seeks appointment as class counsel, the court may appoint that applicant only if the applicant is adequate under Rule 23(g)(1) and (4). If more than one adequate applicant seeks appointment, the court must appoint the applicant best able to represent the interests of the class.

(3) Interim Counsel. The court may designate interim counsel to act on behalf of a putative class before determining whether to certify the action as a class action.

(4) Duty of Class Counsel. Class counsel must fairly and adequately represent the interests of the class.

(h) Attorney’s Fees and Nontaxable Costs. In a certified class action, the court may award reasonable attorney’s fees and nontaxable costs that are authorized by law or by the parties’ agreement. The following procedures apply:

(1) A claim for an award must be made by motion under Rule 54(d)(2), subject to the provisions of this subdivision (h), at a time the court sets. Notice of the motion must be served on all parties and, for motions by class counsel, directed to class members in a reasonable manner.

(2) A class member, or a party from whom payment is sought, may object to the motion.

(3) The court may hold a hearing and must find the facts and state its legal conclusions under Rule 52(a).

(4) The court may refer issues related to the amount of the award to a special master or a magistrate judge, as provided in Rule 54(d)(2)(D).

If your business is presently or may soon be involved in class action litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find class action lawyers who may handle your class action litigation matter on a contingency basis.

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Sixth Circuit Applies Epic Decision In Requiring Arbitration Under FLSA

By | Class Action Lawsuits, Employment Litigation

The United States Court of Appeals for the Sixth Circuit (“Federal Appellate Court”) stated in its opinion filed on August 15, 2018: “The Supreme Court recently held that the National Labor Relations Act does not invalidate individual arbitration agreements. Epic Systems Corp. v. Lewis, 138 S. Ct. 1612, 1632 (2018). That holding answers half of this case. The other half, in which the plaintiffs seek to carve out a separate destiny for the Fair Labor Standards Act, meets a similar end. Since neither Act is an obstacle to the arbitration agreements in this case, we reverse and remand for further proceedings consistent with this opinion.”

The Underlying Facts

Jonathan Gaffers is a former employee of defendant Kelly Services, Inc. (“Kelly Services”). Kelly Services provides outsourcing and consulting services to firms around the world. One of these services is “virtual” call center support, where employees like Gaffers work from home.

Gaffers alleged that Kelly Services underpaid him and his fellow virtual employees. Specifically, Gaffers alleged that Kelly Services shortchanged them for time spent logging in to Kelly Services’ network, logging out, and fixing technical problems that arise. Gaffers brought suit on behalf of himself and his co-workers (over 1,600 joined the action) seeking back pay and liquidated damages under the collective-action provision of the Fair Labor Standards Act. 29 U.S.C. § 216(b).

About half of the employees that Gaffers sought to represent signed an arbitration agreement with Kelly Services (Gaffers himself did not sign one, but he is the representative of the collective action). Those agreements state that individual arbitration is the “only forum” for employment claims, including unpaid-wage claims. Kelly Services therefore moved to compel individual arbitration under the Federal Arbitration Act. 9 U.S.C. § 4. In response, Gaffers contended that the National Labor Relations Act and the Fair Labor Standards Act rendered the employees’ arbitration agreements unenforceable. The district court agreed and denied Kelly Services’ motion to compel arbitration. Kelly Services appealed, and the Federal Appellate Court proceeded with a de novo review.

Gaffers argued on appeal that the FLSA’s collective-action provision and the Arbitration Act are irreconcilable and that the former therefore displaces the latter. The Federal Appellate Court stated that in Epic, the U.S. Supreme Court held that a federal statute does not displace the Arbitration Act unless it includes a “clear and manifest” congressional intent to make individual arbitration agreements unenforecable. To clearly and manifestly make arbitration agreements unenforceable, Congress must do more than merely provide a right to engage in collective action. Instead, Congress must expressly state that an arbitration agreement poses no obstacle to pursuing a collective action. As in the NLRA, Congress made no such statement in the FLSA.

The FLSA provision at issue provides that an employee can sue on behalf of himself and other employees similarly situated. 29 U.S.C. § 216(b). In other words, it gives employees the option to bring their claims together. It does not require employees to vindicate their rights in a collective action, and it does not say that agreements requiring one-on-one arbitration become a nullity if an employee decides that he wants to sue collectively after signing one. Accordingly, the Federal Appellate Court stated it could give effect to both statutes: employees who do not sign individual arbitration agreements are free to sue collectively, and those who do sign individual arbitration agreements are not.

The Federal Appellate Court held: “because the FLSA does not “clearly and manifestly” make arbitration agreements unenforceable, we hold that it does not displace the Arbitration Act’s requirement that we enforce the employees’ agreements as written.  Accordingly, we reverse the district court’s decision to deny Kelly Services’ motion to compel on this basis.”

The Federal Appellate Court also rejected Gaffers’ argument that because the FLSA gives the employees a right to pursue a collective action, the agreements that the employees signed with Kelly Services requiring them to pursue individual arbitration are illegal and therefore unenforceable. The Federal Appellate Court held that the savings clause that allows courts to refuse to enforce arbitration agreements “upon such grounds as exist at law or in equity for the revocation of any contract” (9 U.S.C. § 2) includes an “equal-treatment” rule: individuals can attack an arbitration agreement like they would any other contract but they cannot attack the agreement simply because it is one involving arbitration. Accordingly, defenses that (1) apply only to arbitration agreements, or (2) interfere with the “fundamental attributes of arbitration” are both insufficient.

The Federal Appellate Court held that objecting to an agreement “precisely because [it] require[s] individualized arbitration proceedings instead of class or collective ones” does not bring a plaintiff within the territory of the savings clause. If otherwise, Gaffers (and others) could use this contract defense to attack arbitration itself and that selective treatment is exactly what Epic says is not allowed.

Source

Gaffers v. Kelly Services, Inc., No. 16-2210.

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U.S. Supreme Court Enforces Employment Arbitration Agreements

By | Business Litigation, Class Action Lawsuits, Employment Litigation

The Supreme Court of the United States (“Supreme Court”) enforced the arbitration agreements signed by three employees employed by three different employers, in its opinion filed on May 21, 2018.

In each of the three Supreme Court cases, an employer and employee entered into a contract providing for individualized arbitration proceedings to resolve employment disputes between the parties. Each employee nonetheless sought to litigate Fair Labor Standards Act and related state law claims through class or collective actions in federal court.

Although the Federal Arbitration Act generally requires courts to enforce arbitration agreements as written, the employees argued that its “saving clause” removes this obligation if an arbitration agreement violates some other federal law and that, by requiring individualized proceedings, the agreements violated the National Labor Relations Act. The employers countered that the Arbitration Act protects agreements requiring arbitration from judicial interference and that neither the saving clause nor the NLRA demands a different conclusion.

Until recently, courts as well as the National Labor Relations Board’s general counsel agreed that such arbitration agreements are enforceable. In 2012, however, the Board ruled that the NLRA effectively nullifies the Arbitration Act in cases like these, and since then other courts have either agreed with or deferred to the Board’s position.

The Supreme Court held that Congress has instructed in the Arbitration Act that arbitration agreements providing for individualized proceedings must be enforced, and neither the Arbitration Act’s saving clause nor the NLRA suggests otherwise.

The Supreme Court held: “The policy may be debatable but the law is clear: Congress has instructed that arbitration agreements like those before us must be enforced as written. While Congress is of course always free to amend this judgment, we see nothing suggesting it did so in the NLRA—much less that it manifested a clear intention to displace the Arbitration Act. Because we can easily read Congress’s statutes to work in harmony, that is where our duty lies.”

Source Epic Systems Corporation v. Lewis, 584 U. S. ____ (2018) .

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Federal Appellate Court Says Patent Office Not Entitled To Attorney Fees Under Section 145

By | Patent Litigation

On July 27, 2018, the United States Court of Appeals, Federal District, en banc, decided the case NantKwest, Inc. v. Andrei Iancu, Under Secretary Of Commerce For Intellectual Property And Director Of The United States Patent And Trademark Office, in which it stated:

“When the United States Patent and Trademark Office’s Patent Trial and Appeal Board (“Board”) affirms an examiner’s rejection of a patent application, § 145 of the Patent Act permits the disappointed applicant to challenge the Board’s decision in district court. Applicants who invoke § 145 are required by statute to pay “[a]ll the expenses of the proceedings” incurred by the U.S. Patent and Trademark Office (“PTO”) in defending the Board’s decision, regardless of the outcome. Historically, the agency relied on this provision to recover sums it spent on travel and printing and, more recently, expert witnesses. Now, 170 years after Congress introduced § 145’s predecessor, the agency argues that § 145 also compels applicants to pay its attorneys’ fees. We hold that it does not, for the American Rule prohibits courts from shifting attorneys’ fees from one party to another absent a “specific and explicit” directive from Congress. The phrase “[a]ll the expenses of the proceedings” falls short of this stringent standard. Accordingly, we affirm the district court’s judgment.”

Judicial Review Of Board’s Decisions

The Patent Act gives applicants two mutually exclusive options for judicial review of an adverse Board decision. First, the applicant may appeal directly to the United States Court of Appeals, Federal District. 35 U.S.C. § 141. Second, the applicant may file a civil action against the Director of the PTO in the United States District Court for the Eastern District of Virginia. 35 U.S.C. § 145. The United States Court of Appeals, Federal District, in turn, has jurisdiction over subsequent appeals from the district court under 28 U.S.C. § 1295(a)(1).

Section 141 provides standard judicial review of an agency decision under the Administrative Procedure Act.  Appellate review in § 141 proceedings is confined to the record before the PTO. 35 U.S.C. § 144. The United States Court of Appeals, Federal District, reviews the Board’s legal determinations de novo.

Section 145, by contrast, authorizes a more expansive challenge to the Board’s decision and is generally more time consuming. For example, patent applicants can conduct discovery and introduce new evidence. And once an applicant submits new evidence on a disputed factual question, the district court must make a de novo finding.  The parties may also engage in motion practice, and the proceeding can culminate in a full-blown trial. Congress set the price for engaging the PTO in this type of litigation: “All the expenses of the proceedings shall be paid by the applicant.” 35 U.S.C. § 145. Thus, an applicant who proceeds under § 145 must shoulder not only his own significant expenses and fees, but also the PTO’s “expenses of the proceedings.”

For more than 170 years, however, the PTO never sought—and no court ever awarded—attorneys’ fees under § 145 or its predecessor.

The Underlying Facts Of The Present Case

In 2001, Dr. Hans Klingemann filed a patent application directed to a method for treating cancer using natural killer cells. Dr. Klingemann’s application was eventually assigned to NantKwest, Inc. The examiner rejected the application as obvious in 2010, and the Board affirmed the rejection in 2013.

Pursuant to § 145, NantKwest challenged the Board’s decision by filing a complaint against the Director of the PTO in the U.S. District Court for the Eastern District of Virginia. Discovery ensued and the PTO moved for summary judgment that the application’s claims would have been obvious. The district court granted the PTO’s motion, and the United States Court of Appeals, Federal District affirmed.

After prevailing on the merits, the PTO filed a motion for reimbursement of the “expenses of the proceedings” under § 145. The $111,696.39 sum sought by the PTO included $78,592.50 in attorneys’ fees—calculated based on the pro rata salaries of the two PTO attorneys and one paralegal who worked on the case—and $33,103.89 in expert witness fees. The district court denied the PTO’s motion with respect to attorneys’ fees, citing the American Rule.

The PTO appealed the denial of its motion to recover attorneys’ fees, and a divided panel of the United States Court of Appeals, Federal District reversed the district court’s judgment. The United States Court of Appeals, Federal District voted sua sponte to hear the appeal en banc and vacated the panel’s judgment. The United States Court of Appeals, Federal District requested briefing on a single question: whether the panel “correctly determine[d] that 35 U.S.C. § 145’s `[a]ll the expenses of the proceedings’ provision authorizes an award of the [PTO’s] attorneys’ fees.”

The United States Court of Appeals, Federal District held:”Given the Supreme Court’s line of non-prevailing party precedent and the inapposite nature of Cloer, we see no reason why the American Rule would not apply to § 145. As the Supreme Court has explained, the American Rule simply provides that each litigant bears its own attorney fees. Hardt, 560 U.S. at 253. The PTO’s reading of § 145 requires the opposite. Accordingly, § 145 should not escape the heightened standard required for congressional departure from this bedrock principle …[i]n our view, § 145’s statement that “[a]ll the expenses of the proceedings shall be paid by the applicant” lacks the “specific and explicit” congressional authorization required to displace the American Rule. Section 145 contains no reference to attorneys’ fees, “reasonable compensation for actual, necessary services rendered by the . . . attorney” …  [t]he American Rule and the “specific and explicit” requirement demand more than language that merely can be and is sometimes used broadly to implicitly cover attorneys’ fees. Moreover, other statutory provisions enacted by Congress demonstrate that ordinarily, a statutory right to “expenses” does not include an implicit authorization to award attorneys’ fees. This is further demonstrated by both contemporaneous and current court cases and other statutory provisions in the Patent Act … we emphasize that the PTO’s interpretation of § 145 would have a patent applicant pay the government’s attorneys’ fees even when the patent applicant succeeds. Other than what we believe to be an incorrect interpretation of the trademark analogue in Shammas, we are aware of no statute that requires a private litigant to pay the government’s attorneys’ fees without regard to the party’s success in the litigation.”

Source

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Hourly Rates Charged By Florida Lawyers

By | Attorney Hourly Rate, Statistics

The Florida Bar’s “Results of the 2016 Economics and Law Office Management Survey” found that over three-quarters (81%) of respondents list their hourly rate as being over $200, while over one-third (36%) list their hourly rate as being over $300. The survey also found that the percentage of attorneys who charge an hourly rate in excess of $300 has increased significantly since the previous 2010 survey (from 14% in 2010 to 36% in 2016).

The survey results indicated that the Southeast Region of Florida (70%) contains the highest percentage of respondents who charge an hourly rate of over $250. The North Region (31%) contains the highest percentage of respondents who charge an hourly rate of $200 or less.

Of those respondents who reported having a standard hourly billing rate, over two-fifths (44%) reported it has increased over the past two years, compared to 3% who report it has decreased. Over half (53%) reported their standard hourly billing rate has remained the same over the past two years.

55% of the respondents reported that they expected their standard hourly billing rate to stay the same in 2007; 29% reported they expected to increase their standard hourly rate in 2017; and, only 2% stated that the expected to decrease their standard hourly rate in 2017.

31% of the respondents reported that the hourly rate billed for legal work performed by paralegals in their firm is between $81 and $100, while 49% reported that the billed paralegal hourly rate is over $120.

59% of the respondents reported that their law firm or legal office uses an hourly rate as the primary method for billing, while 17% reported that their firm or legal office uses a combination of methods.

33% of the respondents reported that their firm or legal office handles contingency fee cases. Of those who accept cases on a contingency fee basis, the majority reported that these types of cases comprise one-quarter or less of the total number of cases they handle.

76% of the respondents receive 33% to 40% of the award in victorious contingency fee cases, which is an increase from 68% who reported the same in 2014.

34% of the respondents expected the demand for paid billable lawyer services in their area to either significantly or somewhat increase within the next five years, compared to 12% who expected it to significantly or somewhat decrease within that time frame.

Source

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