Byrne v. Wood, Herron & Evans, LLP ( 2012 )

United States Court of Appeals
for the Federal Circuit
__________________________
STEPHEN E. BYRNE,
Plaintiff-Appellant,
v.
WOOD, HERRON & EVANS, LLP,
DAVID S. STALLARD, KEVIN G. ROONEY,
THEODORE R. REMAKLUS, P. ANDREW BLATT,
AND WAYNE L. JACOBS,
Defendants-Appellees.
__________________________
2011-1012
__________________________
Appeal from the United States District Court for the
Eastern District of Kentucky in case no. 08-CV-0102,
Judge Danny C. Reeves.
__________________________
ON PETITION FOR REHEARING EN BANC
__________________________
JAMES A. JABLONSKI, Law Office of James A. Jablon-
ski, of Denver, Colorado, filed a petition for rehearing en
banc for plaintiff-appellant.
J. ROBERT CHAMBERS, Wood, Herron & Evans, L.L.P.,
of Cincinnati, Ohio, filed a response to the petition for
defendants-appellees.
__________________________
BYRNE v. WOOD HERRON 2
Before RADER, Chief Judge, NEWMAN, LOURIE, BRYSON,
GAJARSA, ∗ LINN, DYK, PROST, MOORE, O’MALLEY, REYNA,
and WALLACH, Circuit Judges.
PER CURIAM.
DYK, Circuit Judge, with whom NEWMAN and LOURIE,
Circuit Judges, join, concurs in the denial of the petition
for rehearing en banc.
O’MALLEY, Circuit Judge, with whom WALLACH, Cir-
cuit Judge, joins, dissents from the denial of the petition
for rehearing en banc.
ORDER
A petition for rehearing en banc was filed by Plaintiff-
Appellant, and a response thereto was invited by the
court and filed by Defendants-Appellees. The petition for
rehearing was referred to the panel that heard the appeal,
and thereafter the petition for rehearing en banc and the
response were referred to the circuit judges who are
authorized to request a poll of whether to rehear the
appeal en banc. A poll was requested, taken, and failed.
Upon consideration thereof,
IT IS ORDERED THAT:
(1) The petition of Plaintiff-Appellant for
panel rehearing is denied.
(2) The petition of Plaintiff-Appellant for re-
hearing en banc is denied.
(3) The mandate of the court will issue on March 29,
2012.
∗
Judge Gajarsa participated in the decision for
panel rehearing.
3 BYRNE v. WOOD HERRON
FOR THE COURT
March 22, 2012 /s/ Jan Horbaly
Date Jan Horbaly
Clerk
United States Court of Appeals
for the Federal Circuit
__________________________
STEPHEN E. BYRNE,
Plaintiff-Appellant,
v.
WOOD, HERRON & EVANS, LLP,
DAVID S. STALLARD,
KEVIN G. ROONEY, THEODORE R. REMAKLUS,
P. ANDREW BLATT, AND WAYNE L. JACOBS,
Defendants-Appellees.
__________________________
2011-1012
__________________________
Appeal from the United States District Court for the
Eastern District of Kentucky in case no. 08-CV-0102,
Judge Danny C. Reeves.
DYK, Circuit Judge, with whom NEWMAN and LOURIE,
Circuit Judges, join, concurring in the denial of the peti-
tion for rehearing en banc.
__________________________
Under the Supreme Court’s decision in Christianson
v. Colt Industries Operating Corp., 486 U.S. 800, 809
(1988), federal jurisdiction under 28 U.S.C. § 1338 exists
if “the plaintiff’s right to relief necessarily depends on
resolution of a substantial question of federal patent law,
in that patent law is a necessary element of one of the
well-pleaded claims.” We have followed Christianson in
BYRNE v. WOOD HERRON 2
subsequent cases involving legal malpractice, holding that
federal jurisdiction exists, for example, “when the adjudi-
cation of the malpractice claim requires the court to
address the merits of the plaintiff’s underlying patent
infringement lawsuit,” Warrior Sports, Inc. v. Dickinson
Wright, P.L.L.C., 631 F.3d 1367, 1371 (Fed. Cir. 2011),
and when a “claim drafting error is a necessary element of
the malpractice cause of action,” Immunocept, LLC v.
Fulbright & Jaworski, LLP, 504 F.3d 1281, 1285 (Fed.
Cir. 2007). In so holding, we have recognized the strong
federal interest in patent law uniformity as manifested by
Congress’s decision to give exclusive jurisdiction to the
federal district courts and on appeal to this court. See
Immunocept, 504 F.3d at 1285-86; Air Measurement
Techs., Inc. v. Akin Gump Strauss Hauer & Feld, L.L.P.,
504 F.3d 1262, 1272 (Fed. Cir. 2007); see also USPPS,
Ltd. v. Avery Dennison Corp., 647 F.3d 274, 284 (5th Cir.
2011). All of the malpractice cases that we have held are
within the scope of section 1338 as pleaded have required
the resolution of substantive patent law issues. 1 The
1 See, e.g., Warrior Sports, 631 F.3d at 1372 (“[T]o
prove the proximate cause and injury elements of its tort
claim, Michigan law requires [plaintiff] to show that it
would have prevailed on its infringement claim . . . .”);
Carter v. ALK Holdings, Inc., 605 F.3d 1319, 1325 (Fed.
Cir. 2010) (“[T]he determination of [the patent attorney’s]
compliance with the MPEP and the CFR is a necessary
element of [plaintiff’s] malpractice cause of action . . . .”);
Davis v. Brouse McDowell, L.P.A., 596 F.3d 1355, 1360
(Fed. Cir. 2010) (“[Plaintiff] can prevail only by proving
that U.S. patents would have issued on her applications
but for Defendants’ malpractice—i.e., that her inventions
were patentable under U.S. law.”); Touchcom, Inc. v.
Bereskin & Parr, 574 F.3d 1403, 1413 (Fed. Cir. 2009)
(“[Plaintiff] will be required to show that, had appellees
not omitted a portion of the source code from its applica-
tion, the resulting U.S. patent would not have been held
invalid.”); Immunocept, 504 F.3d at 1285 (“[T]here is no
3 BYRNE v. WOOD HERRON
existence of these issues necessarily makes the issues
“substantial” within the meaning of Christianson, 486
U.S. at 809, and indicates a “serious federal interest” in
federal adjudication within the meaning of Grable & Sons
Metal Products, Inc. v. Darue Engineering & Manufactur-
ing, 545 U.S. 308, 313 (2005).
Judge O’Malley’s dissent, in arguing that section 1338
does not confer jurisdiction over malpractice claims de-
pendent on federal patent law, minimizes the substantial
federal interest in federal adjudication of the patent law
issues in these cases. Patent-related malpractice claims
necessarily involve attorney conduct before the U.S.
Patent and Trademark Office (“PTO”) or before the fed-
eral courts (because of our exclusive jurisdiction), and
there is a substantial federal interest in ensuring that
federal patent law questions are correctly and uniformly
resolved in determining the standards for attorney con-
duct in these proceedings, even when the patent law issue
is case-specific. 2 See generally Grable, 545 U.S. 308.
Indeed, attorney conduct in patent cases is implicated by
the patent law itself, such as by the doctrine of inequita-
ble conduct, the exceptional-case statute, and the statu-
tory provisions authorizing regulation of PTO practice.
See Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d
1276, 1290 (Fed. Cir. 2011) (en banc) (noting that an
attorney’s submissions to the PTO may be a basis for an
way [plaintiff] can prevail without addressing claim
scope.”); Air Measurement Techs., 504 F.3d at 1269 (“[T]he
district court will have to adjudicate, hypothetically, the
merits of the infringement claim.”).
2 In contrast, trademark-related malpractice claims
such as those at issue in Singh v. Duane Morris LLP, 538
F.3d 334 (5th Cir. 2008), can involve conduct before the
state courts. The Fifth Circuit specifically noted that the
federal interest in patent cases is thus more substantial
than in trademark cases. Id. at 340.
BYRNE v. WOOD HERRON 4
inequitable conduct finding); Brooks Furniture Mfg., Inc.
v. Dutalier Int’l, Inc., 393 F.3d 1378, 1381 (Fed. Cir. 2005)
(noting that attorney misconduct may be a predicate for
an exceptional case finding under 35 U.S.C. § 285); Carter
v. ALK Holdings, Inc., 605 F.3d 1319, 1324 (Fed. Cir.
2010) (“The standards for practice before the PTO are
governed by federal law . . . .”). So too all federal patent
rights are created by actions of a federal agency, the PTO.
See Grable, 545 U.S. at 315 (“The Government thus has a
direct interest in the availability of a federal forum to
vindicate its own administrative action . . . .”).
State court decisions imposing attorney discipline for
conduct before the PTO and in federal patent litigation
based on an incorrect interpretation of patent law are
almost certain to result in differing standards for attorney
conduct and to impair the patent bar’s ability to properly
represent clients in proceedings before the PTO and in the
federal courts. Denying federal jurisdiction over these
cases would allow different states to reach different
conclusions as to the requirements for federal patent law
in the context of state malpractice proceedings. There is a
substantial federal interest in preventing state courts
from imposing incorrect patent law standards for proceed-
ings that will exclusively occur before the PTO and the
federal courts. To be sure, with some exceptions, 3 state
law governing attorney malpractice is not preempted by
federal law. See Kroll v. Finnerty, 242 F.3d 1359, 1366
(Fed. Cir. 2001). But this hardly lessens the significant
federal interest in the correct and uniform interpretation
of federal patent law in the course of such state malprac-
tice proceedings. That important interest supports recog-
3 See Sperry v. Fla. ex rel Fla. Bar, 373 U.S. 379,
385 (1963) (holding that Florida could not exercise “a
virtual power of review” over PTO practice by prohibiting
nonlawyers from engaging in patent practice).
5 BYRNE v. WOOD HERRON
nizing federal jurisdiction where the outcome of the
proceeding depends on an interpretation of federal patent
law, and demonstrates that such adjudication does not
upset the federal-state balance. See Christianson, 486
U.S. at 809.
I see no reason to revisit this court’s repeated hold-
ings that where the outcome of malpractice cases turns on
federal patent law, federal jurisdiction exists.
United States Court of Appeals
for the Federal Circuit
__________________________
STEPHEN E. BYRNE,
Plaintiff-Appellant,
v.
WOOD, HERRON & EVANS, LLP,
DAVID S. STALLARD, KEVIN G. ROONEY,
THEODORE R. REMAKLUS, P. ANDREW BLATT,
AND WAYNE L. JACOBS,
Defendants-Appellees.
__________________________
2011-1012
__________________________
Appeal from the United States District Court for the
Eastern District of Kentucky in case no. 08-CV-0102,
Judge Danny C. Reeves.
O’MALLEY, Circuit Judge, with whom WALLACH, Cir-
cuit Judge, joins, dissenting from the denial of the peti-
tion for rehearing en banc.
__________________________
It is time we stop exercising jurisdiction over state
law malpractice claims. I dissent from the court’s refusal
to consider this matter en banc so that the case law
through which we have expanded the scope of our juris-
diction to these purely state law matters can be reconsid-
ered and revamped.
BYRNE v. WOOD HERRON 2
This court has justified expanding the reach of our ju-
risdiction to cover state law malpractice claims by reading
Christianson v. Colt Industries Operating Corp., 486 U.S.
800 (1988), to authorize our doing so. Specifically, our
case law concludes that, whenever a patent law issue is
raised in the context of a state law claim and must be
resolved in the course of that otherwise state law inquiry,
federal jurisdiction will lie, as will exclusive appellate
jurisdiction in this court. That reading of Christianson is
wrong, however. Supreme Court precedent permits
federal courts to exercise federal question jurisdiction
over state law claims only in the rare case where a federal
issue is “actually disputed and substantial,” and where
doing so will not upset “any congressionally approved
balance of federal and state judicial responsibilities.”
Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg.,
545 U.S. 308, 314 (2005). “[T]he mere presence of a
federal issue in a state cause of action does not automati-
cally confer federal-question jurisdiction.” Merrell Dow
Pharm. Inc. v. Thompson, 478 U.S. 804, 813 (1986).
Rather, courts must undertake a four-step inquiry as to
whether: (1) a federal issue is a necessary element of a
state law claim; (2) a federal issue is actually disputed; (3)
a federal issue is substantial; and (4) exercising federal
jurisdiction will disturb the balance of federal and state
judicial responsibilities. Grable, 545 U.S. at 314. In
choosing to exercise jurisdiction over malpractice claims
arising out of patent matters, we have ignored the latter
two parts of the inquiry.
Even if Christianson’s directives were once ambigu-
ous, subsequent Supreme Court case law has clarified the
test in a way that leaves no doubt that our narrow read-
ing of Christianson can no longer be justified. As dis-
cussed below, proper application of Supreme Court
precedent demands that we decline to exercise jurisdiction
3 BYRNE v. WOOD HERRON
over this and similar state law malpractice actions.
Rather than force the Supreme Court to correct our
jurisdictional mistakes, we should take this opportunity
to do so ourselves.
I.
Stephen Byrne originally brought this action in the
Circuit Court of Kenton County, Kentucky, asserting a
state law claim for legal malpractice based on defendants’
representation of Byrne in prosecuting a patent for a lawn
care device. The gist of Byrne’s malpractice case is that
defendants negligently failed to secure broader patent
protection for his invention from the United States Patent
and Trademark Office (“PTO”), and, as a result, Byrne
was unsuccessful in a subsequent patent infringement
lawsuit against Black & Decker Corporation and related
entities (collectively, “Black & Decker”). See Byrne v.
Black & Decker Corp., 2007 WL 1492101 (Fed. Cir. May
21, 2007). All agree that Byrne’s claim is a purely state
law claim for which federal law creates no cause of action.
Defendants removed the action to the United States
District Court for the Eastern District of Kentucky, as-
serting jurisdiction under 28 U.S.C. § 1338, on grounds
that Byrne’s claim required resolution of an issue of
patent law. Notice of Removal, Byrne v. Wood, Herron &
Evans, LLP, No. 2:08-cv-102 (E.D. Ky. May 30, 2008),
ECF No. 1. Specifically, defendants argued that, to
prevail on his state law claim, Byrne would have to estab-
lish that he likely would have succeeded in a hypothetical
infringement action based on the broader patent he says
his counsel should have sought from the PTO. When
Byrne moved to remand the action to state court, the
district court denied the motion, relying on Federal Cir-
cuit case law to find that federal jurisdiction was proper
under § 1338. See Byrne v. Wood, Herron & Evans, LLP,
BYRNE v. WOOD HERRON 4
2008 WL 3833699, at *4 (E.D. Ky. Aug. 13, 2008) (citing
Air Measurement Techs., Inc. v. Akin Gump Strauss
Hauer & Feld, LLP, 504 F.3d 1262, 1269 (Fed. Cir. 2007)).
Accordingly, the case proceeded in federal court.
On appeal to this court, a majority of the panel agreed
that our current case law extended § 1338 jurisdiction
over this action but noted that, because it is inconsistent
with Supreme Court precedent, that case law should be
revisited. See Byrne v. Wood, Herron & Evans, LLP, 2011
WL 5600640, at *5 (Fed. Cir. Nov. 18, 2011) (“Although
we must adhere to our precedent, we believe this court
should re-evaluate the question of whether jurisdiction
exists to entertain a state law malpractice claim involving
the validity of a hypothetical patent . . . .” (emphasis in
original)). The panel then reluctantly resolved the merits
of the appeal, and this petition for rehearing en banc
followed.
II.
This court has exclusive jurisdiction over appeals
from district court decisions “if the jurisdiction of that
court was based, in whole or in part, on § 1338.” 28
U.S.C. § 1295(a)(1) (2007). In turn, § 1338 provides in
relevant part that “[t]he district courts shall have original
jurisdiction of any civil action arising under any Act of
Congress relating to patents, plant variety protection,
copyrights and trademarks.” 28 U.S.C. § 1338(a) (2007).
Because the “arising under” language of § 1338 mirrors
that of the general federal question jurisdiction statute,
28 U.S.C. § 1331, the Supreme Court has “grafted § 1331
precedent onto its § 1338 analysis.” Lab. Corp. of Am.
Holdings v. Metabolite Labs., Inc., 599 F.3d 1277, 1282
(Fed. Cir. 2010) (citing Christianson, 486 U.S. at 808-09).
Accordingly, consistent with decisions applying
§ 1331, the Supreme Court has outlined a two-prong test,
5 BYRNE v. WOOD HERRON
in which district court jurisdiction under § 1338(a) ex-
tends “only to those cases in which a well-pleaded com-
plaint establishes either [1] that federal patent law
creates the cause of action or [2] that the plaintiff’s right
to relief necessarily depends on resolution of a substantial
question of federal patent law, in that patent law is a
necessary element of one of the well-pleaded claims.”
Christianson, 486 U.S. at 808-09 (citations omitted). It is
the second prong of the Christianson test that is at issue
here, as it is in all state law malpractice actions, because
no one contends that federal patent law creates Byrne’s
cause of action. 1
1 The Leahy–Smith America Invents Act amended
§§ 1295 and 1338, but those amendments do not apply
here because they are effective only for actions com-
menced on or after the date of its enactment, which
postdates the initiation of the present litigation. See
Leahy–Smith America Invents Act, Pub. L. No. 112–29,
Sec. 19, 125 Stat. 284, 331–32 (2011) (“AIA”). Even if
applicable, those changes would not affect this analysis
because the amendments did not alter the key “arising
under” language in § 1338. Indeed, Congress expressly
decided not to alter the first sentence of § 1338 when it
passed the AIA, as the Federal Circuit Bar had proposed
it do, precisely so as to avoid “unsettling the law in ways
that no one can fully anticipate.” H.R. Rep. No. 109-407,
at 6 (2006) (quoting the testimony of Professor Arthur
Hellman). The AIA’s legislative history makes clear that
Congress did not intend to affect the second prong of the
Christianson doctrine, which relates to the jurisdictional
question at issue in this case – i.e., where a state law
claim involves issues of patent law. See “Holmes Group,”
the Federal Circuit, and the State of Patent Appeals:
Hearing Before the Subcomm. on Courts, the Internet, and
Intellectual Property of the House Comm. on the Judiciary,
109th Cong., 1st Sess., 40 (Serial No. 109-7) (Mar. 17,
2005) (statement of Professor Arthur Hellman) (explain-
ing that the second prong of the Christianson doctrine
would continue to be applicable to limit federal court
BYRNE v. WOOD HERRON 6
“[T]he vast majority of cases brought under the gen-
eral federal-question jurisdiction of the federal courts are
those in which federal law creates the cause of action.”
Merrell Dow, 478 U.S. at 808. 2 The second prong of
Christianson derives from the Supreme Court’s recogni-
tion that federal jurisdiction also may lie in limited cir-
cumstances where state law creates the cause of action
but the action turns on construction of federal law.
Merrell Dow, 478 U.S. at 808-09 (citing Franchise Tax Bd.
of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463
U.S. 1, 9 (1983)). The Court has advised that this alter-
native basis for jurisdiction “must be read with caution”
because “determinations about federal jurisdiction require
sensitive judgments about congressional intent, judicial
power, and the federal system.” Id. at 809-10. Because of
the sensitive nature of the inquiry, the analysis requires
“prudence and restraint.” Id. at 810 (citing Franchise Tax
Bd., 463 U.S. at 20).
jurisdiction, under the version of the AIA adopted by
Congress).
2 Indeed, nearly a century ago in a case involving a
patent issue, Justice Oliver Wendell Holmes, Jr. articu-
lated a rule that would have excluded cases falling under
the second prong of the Christianson test from federal
court review, stating that “[a] suit arises under the law
that creates the cause of action.” Am. Well Works Co. v.
Layne & Bowler Co., 241 U.S. 257, 260 (1916). Thus, in
that case, a claim for libel based on allegedly false state-
ments that the plaintiff’s product infringed the defen-
dant’s patent was found not to invoke federal question
jurisdiction. Id. at 259-60. The Court reasoned that,
“[t]he fact that the justification [for the allegedly libelous
statements] may involve the validity and infringement of
a patent is no more material to the question under what
law the suit is brought than it would be in an action of
contract.” Id. at 260.
7 BYRNE v. WOOD HERRON
The Supreme Court focused on these federalism con-
cerns, and incorporated them into any jurisdictional
inquiry taken under the second prong of Christianson,
when it decided Grable & Sons Metal Products, Inc. v.
Darue Engineering & Manufacturing, 545 U.S. 308, 313-
14 (2005). In Grable, the Court explained that the exer-
cise of federal jurisdiction is “subject to a possible veto,”
even where a state law claim contains a contested and
substantial federal question, if exercising jurisdiction is
not “consistent with congressional judgment about the
sound division of labor between state and federal courts.”
Grable, 545 U.S. at 313-14. Accordingly, the Court articu-
lated the test as follows: “does a state-law claim necessar-
ily raise a stated federal issue, actually disputed and
substantial, which a federal forum may entertain without
disturbing any congressionally approved balance of fed-
eral and state judicial responsibilities.” Id. at 314.
The facts of Grable are instructive for understanding
the parameters of the test it announced. In Grable, the
Court considered whether a state law claim to quiet title
that depended on an interpretation of a federal tax code
provision properly invoked federal question jurisdiction.
Id. at 310-11. In that case, the Internal Revenue Service
(“IRS”) seized Grable & Sons Metal Products, Inc.’s real
property to satisfy a federal tax deficiency. Id. When the
IRS later sold the seized property to Darue Engineering &
Manufacturing, Grable sued Darue in state court to quiet
title, alleging that the IRS’s seizure notice was invalid
because it did not comply with 26 U.S.C. § 6335(a). Id. at
311. The sole and dispositive issue in the case, therefore,
was the interpretation of § 6335(a), specifically whether
that statute required notice of seizure to be served per-
sonally, or whether service by certified mail was suffi-
cient. Under the facts of that case, the Court concluded
that the federalism balance weighed in favor of federal
BYRNE v. WOOD HERRON 8
jurisdiction because “[t]he meaning of the federal tax
provision is an important issue of federal law that sensi-
bly belongs in a federal court.” Id. at 315. It reasoned
that “[t]he Government . . . has a direct interest in the
availability of a federal forum to vindicate its own admin-
istrative action, and buyers (as well as tax delinquents)
may find it valuable to come before judges used to federal
tax matters.” Id. at 315. The Grable Court emphasized,
moreover, that “it will be the rare state title case that
raises a contested matter of federal law,” such that the
effect on the federal-state balance will be only “micro-
scopic.” Id.
One year later, the Supreme Court made clear that, to
the extent Grable authorizes the exercise of jurisdiction in
cases where federal law does not directly create the cause
of action, it is to be read narrowly. See Empire Health-
choice Assurance, Inc. v. McVeigh, 547 U.S. 677 (2006). In
Empire Healthchoice, the Court concluded that federal
question jurisdiction does not exist over a health insur-
ance carrier’s claim for reimbursement of insurance
benefits, even where the carrier administered a plan for
federal employees under a federal statute, and the federal
statute included a clause preempting state law on issues
relating to “coverage of benefits.” Id. at 682-83. In doing
so, the Court characterized Grable as carving out a “spe-
cial and small category” of cases and found that the facts
of Empire Healthchoice were “poles apart” from Grable.
Id. at 699-700. The Court identified several factors that
led the Grable Court to find federal question jurisdiction:
(1) the dispute in that case centered on the action of a
federal agency and its compliance with a federal statute;
(2) the federal question was “substantial”; (3) resolution of
the federal question was dispositive of the case; and (4)
resolution of the federal question “would be controlling in
numerous other cases.” Id. at 700. The Court also high-
9 BYRNE v. WOOD HERRON
lighted that Grable presented a “nearly ‘pure issue of
law,’” unlike the “fact-bound and situation-specific” claim
at issue in the case before it. Id. at 701 (quoting R.
Fallon, D. Meltzer & D. Shapiro, Hart and Wechsler’s The
Federal Courts and the Federal System 65 (5th ed. 2003)
(5th ed. Supp. 2005)). Because those factors were not
present in Empire Healthchoice, the Court concluded that
the case “cannot be squeezed into the slim category
Grable exemplifies.” Id.III.
A.
Even before Grable added an express federalism
“veto” to the federal question analysis, courts widely
understood that a state law tort claim, including one for
legal malpractice, did not “arise under” federal law simply
because the underlying subject matter of the alleged tort
was federal in nature. E.g., Diaz v. Sheppard, 85 F.3d
1502 (11th Cir. 1996) (finding no federal jurisdiction over
a prisoner’s malpractice action alleging that his attorney,
in an action under 42 U.S.C. § 1983, misunderstood the
scope of the Eighth Amendment to the U.S. Constitution);
Custer v. Sweeney, 89 F.3d 1156 (4th Cir. 1996) (finding
no federal jurisdiction over an action against an attorney
based on his allegedly negligent conduct in representing
an employee benefit plan regulated by the Employee
Retirement Income Security Act (“ERISA”)); Berg v.
Leason, 32 F.3d 422 (9th Cir. 1994) (finding no jurisdic-
tion over a malicious prosecution claim, where the alleg-
edly unlawful prosecution was for violations of federal
securities law and the Racketeering Influenced and
Corrupt Organizations (“RICO”) Act).
Notably, before the Federal Circuit addressed this is-
sue in 2007, the result was no different for state law
malpractice claims involving an underlying patent prose-
BYRNE v. WOOD HERRON 10
cution or litigation matter. E.g., Adamasu v. Gifford,
Krass, Groh, Sprinkle, Anderson & Citkowski, P.C., 409 F.
Supp. 2d 788 (E.D. Mich. 2005) (remanding a legal mal-
practice claim alleging negligent patent prosecution);
New Tek Mfg., Inc. v. Beehner, 702 N.W.2d 336 (Neb.
2005) (“New Tek I”) (finding that state court jurisdiction is
proper over a malpractice claim in which the plaintiff
would have to prove, under its properly construed patent
claims, that it would have prevailed in a patent infringe-
ment action). 3 As one court noted, “[s]imply because the
defendants rendered advice on a matter governed by
federal law and prosecuted a patent through a federal
agency does not constitute an issue that ‘arises under any
Act of Congress relating to patents,’ as 28 U.S.C. § 1338requires.” Adamasu, 409 F. Supp. 2d at 792.
3 See also IMT, Inc. v. Haynes & Boone, L.L.P.,
1999 WL 58838 (N.D. Tex. Feb. 1, 1999) (remanding a
legal malpractice claim to state court where the plaintiff
alleged that its attorney’s negligence in filing a continua-
tion-in-part patent application instead of a new patent
application raised questions about the patent’s validity
and enforceability); Commonwealth Film Processing, Inc.
v. Moss & Rocovich, P.C., 778 F. Supp. 283 (W.D. Va.
1991) (remanding malpractice action based on an attor-
ney’s alleged lack of patent knowledge); Minatronics Corp.
v. Buchanan Ingersoll P.C., 28 Pa. D. & C.4th 214 (Pa.
Comm. Pl. 1996) (finding no jurisdiction over a claim for
malpractice based on a missed patent application filing
deadline, even though the court would have to determine
whether a patent would have issued); Fotodyne, Inc. v.
Barry, 449 N.W.2d 337 (Wis. Ct. App. Sept. 26, 1989)
(unpublished) (finding that state court jurisdiction is
proper in a malpractice action based on an attorney’s
failure to notify his client that the PTO had rejected his
patent application).
11 BYRNE v. WOOD HERRON
B.
In 2007, the Federal Circuit weighed in on this issue
in what one commentator has described as a “substantial
shift in the view of whether federal or state courts have
jurisdiction over patent-related legal malpractice claims.”
Robert W. Hesselbacher, Jr., Which Court Decides? Legal
Malpractice Claims Arising from Patents, 51 No. 5
DRIFTD 32 (May 2009). In that year, a single panel of
this court issued two decisions on the same day that,
according to the panel, resolved an “issue of first impres-
sion” – i.e., whether § 1338 jurisdiction exists where a
legal malpractice claim requires resolution of an underly-
ing question of patent law. See Air Measurement Techs.,
Inc. v. Akin Gump Strauss Hauer & Feld, L.L.P., 504 F.3d
1262 (Fed. Cir. 2007) (“AMT”); Immunocept, LLC v.
Fulbright & Jaworski, LLP, 504 F.3d 1281 (Fed. Cir.
2007).
Since 2007, this court has issued three more prece-
dential decisions applying AMT and Immunocept to other
malpractice claims involving an underlying patent prose-
cution or litigation error. See Warrior Sports, Inc. v.
Dickinson Wright, P.L.L.C., 631 F.3d 1367 (Fed. Cir.
2011) (vacating district court’s order remanding a mal-
practice claim alleging patent prosecution errors); Davis
v. Brouse McDowell, L.P.A., 596 F.3d 1355 (Fed. Cir.
2010) (finding § 1338 jurisdiction over a malpractice claim
based on an attorney’s failure to file timely patent appli-
cations); Touchcom, Inc. v. Bereskin & Parr, 574 F.3d
1403 (Fed. Cir. 2009) (finding that the plaintiff’s malprac-
tice claims alleging patent prosecution errors arose under
federal law). Through these cases, we have gone so far as
to extend § 1338 jurisdiction to cases in which no patent
has issued and no actual patent rights are at stake. See
Davis, 596 F.3d at 1361-62 (extending jurisdiction where
the plaintiff would have to prove that, but for her attor-
BYRNE v. WOOD HERRON 12
ney’s missed patent application filing deadline, her inven-
tion would have been patentable). 4
4 The panel majority in the present matter empha-
sized that cases involving only a hypothetical patent
clearly do not implicate a substantial federal interest. See
Byrne v. Wood, Herron & Evans, LLP, 2011 WL 5600640,
at *5 (Fed. Cir. Nov. 18, 2011) (“[W]e believe this court
should re-evaluate the question of whether jurisdiction
exists to entertain a state law malpractice claim involving
the validity of a hypothetical patent . . . .” (emphasis in
original)). Other courts have articulated the same point.
E.g., Roof Technical Servs., Inc. v. Hill, 679 F. Supp. 2d
749, 753 (N.D. Tex. 2010) (Explaining that, “there is a
federal interest in the uniform application of patent laws,
but that interest is not implicated here, where no patent
rights are actually at stake”); Genelink Biosciences, Inc. v.
Colby, 722 F. Supp. 2d 592, 598-99 (D.N.J. 2010) (Finding
that “because no patent was issued, no patent rights are
at stake, and there are therefore no fears that substantive
patent law would [be] altered by inconsistency”). Such
cases present the most clear-cut situation in which federal
question jurisdiction is not appropriate because they have
zero potential impact on the validity or enforceability of
an issued patent. But that should not suggest that mal-
practice cases in which the underlying actions involved
issued patents properly belong in federal court. In virtu-
ally every patent-related malpractice action that requires
a “case within a case” analysis, there will be a hypotheti-
cal patent issue raised – i.e., in a world where no mal-
practice occurred, would the patentee have fared better,
for example, in its patent application or infringement
suit? In that sense, the patent issue in any malpractice
action will involve only an academic inquiry into what
likely would have happened absent the attorney negli-
gence, and the answer will affect only the result of the
state law claim, not the rights or scope of any live patent.
13 BYRNE v. WOOD HERRON
C.
Federal Circuit case law on this issue has been out of
step with that of other federal and state courts. In post-
Grable cases involving state law tort claims that involve
any federal law other than patent law, courts correctly
follow a restrictive approach to federal question jurisdic-
tion in finding that such cases belong in state court.
Indeed, even where state law claims involve federal law
questions over which federal courts have exclusive juris-
diction (e.g., Sherman Act, copyright), other areas of §
1338 jurisdiction (e.g., trademark, copyright), areas that
are uniquely federal in nature (e.g., federal criminal law,
federal tax code, aviation standards), or more garden-
variety federal issues (e.g., Title VII, Age Discrimination
in Employment Act (“ADEA”)), courts consistently find
that such claims do not invoke federal court jurisdiction.
E.g., Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d
1290 (11th Cir. 2008) (claims of negligence and defama-
tion requiring interpretation of the legality of gun sales
under federal criminal gun statutes); Singh v. Duane
Morris LLP, 538 F.3d 334 (5th Cir. 2008) (trademark
malpractice claims) 5 ; Mikulski v. Centerior Energy Corp.,
501 F.3d 555 (6th Cir. 2007) (en banc) (claims for breach
of contract and fraud that required interpretation of
5 Although another panel on that circuit recently
distinguished Singh from a case involving a fraud claim
relating to a failed patent application, it did so in a con-
clusory analysis based almost wholly on our case law. See
USPPS, Ltd. v. Avery Dennison Corp., 647 F.3d 274, 281-
82 (5th Cir. 2011). The Fifth Circuit’s analysis in USPPS
is erroneous for the same reasons our case law is incor-
rect. The USPPS case also demonstrates that our case
law continues to upset the federalism balance by extend-
ing federal question jurisdiction to cases even beyond
those asserting traditional malpractice claims.
BYRNE v. WOOD HERRON 14
federal tax code provision); Bennett v. Sw. Airlines Co.,
484 F.3d 907 (7th Cir. 2007) (negligence and other claims
relating to activity governed by federal aviation law).6
D.
The analyses in the other circuit and district court de-
cisions have focused on two aspects of the Grable test to
find that federal jurisdiction is lacking, namely that: (1)
the federal issue, even if present and disputed, is not
“substantial”; and (2) exercising jurisdiction would upend
the appropriate federal-state division of judicial labor.
As explained below, this court’s erroneous approach to
both of those considerations has caused it to extend its
jurisdiction improperly to patent-related malpractice
claims.
6 See also RX.com, Inc. v. O’Quinn, 766 F. Supp. 2d
790 (S.D. Tex. 2011) (malpractice based on underlying
antitrust lawsuit under the Sherman Act); Mr. Bar-B-Q,
Inc. v. Natter & Natter, 2011 WL 2015574 (S.D.N.Y. May
18, 2011) (trademark malpractice claims); Steele v. Salb,
681 F. Supp. 2d 34 (D.D.C. 2010) (malpractice based on
underlying Title VII action); Paulet v. Farlie, Turner &
Co., LLC, 2010 WL 2232662 (S.D. Fla. June 2, 2010)
(whistleblower claim that required a determination of
whether actions constituted copyright infringement);
Anderson v. Johnson, 2009 WL 2244622 (N.D. Ill. July 27,
2009) (malpractice claim based on underlying copyright
infringement action); Higbee v. Malleris, 470 F. Supp. 2d
845 (N.D. Ill. 2007) (malpractice based on underlying
Title VII and ADEA action). But see Katz v. Holland &
Knight LLP, 2009 WL 367204 (E.D. Va. Feb. 12, 2009)
(relying on our case law to find federal jurisdiction over
claims for fraud and breach of fiduciary duty, where the
plaintiff alleged that attorneys misrepresented the
strength of a copyright claim).
15 BYRNE v. WOOD HERRON
1.
As to substantiality of the federal issue, the Supreme
Court, and regional circuit courts applying Supreme
Court decisions, have identified certain considerations
that affect whether a federal issue is “substantial”: (1) if
the issue is a “pure question of law,” rather than one that
is “fact-bound and situation-specific”; (2) the federal
government’s interest in the issue, including whether it
implicates a federal agency’s ability to vindicate its rights
in a federal forum and whether resolution of the issue
would be controlling in numerous other cases; and (3) if
resolution of the federal issue is dispositive of the case at
hand. Empire Healthchoice, 547 U.S. at 700-01 (analyz-
ing Grable, 545 U.S. at 313); Adventure Outdoors, 552
F.3d at 1299-1301; Mikulski, 501 F.3d at 570. Application
of these considerations to patent-related malpractice
actions, including the present case, reveals that the
patent issues arising in such cases are not “substantial.”
First, none of the patent-related malpractice cases
over which we have found § 1338 jurisdiction involved
pure questions of law; rather, they required only fact-
specific applications of patent laws to the circumstances of
each case. In AMT, for example, we explained that “the
district court will have to adjudicate, hypothetically, the
merits of the infringement claim.” AMT, 504 F.3d at
1269. The “patent issue” we identified, therefore, re-
quired the district court to consider only the hypothetical
question of infringement under the facts of that particular
case. The question of patent infringement, moreover, is a
question of fact. E.g., Absolute Software, Inc. v. Stealth
Signal, Inc., 659 F.3d 1121, 1129-30 (Fed. Cir. 2011).
Even where courts must consider whether, absent a
claim drafting or prosecution error, a valid patent would
have issued, the only question is whether a different
BYRNE v. WOOD HERRON 16
patent could have issued under the particular circum-
stances of that case. Those cases, therefore, do not require
courts to interpret or consider the “meaning” of a patent
statute, as opposed to merely applying the patent laws to
the facts of a particular case. In undertaking that task,
state courts and regional circuit courts, of course, can rely
on and apply the body of patent law the Federal Circuit
has developed. See Tafflin v. Levitt, 493 U.S. 455, 465
(1990) (finding that state courts applying RICO statutes
will be “guided by federal court interpretations of the
relevant federal criminal statutes, just as federal courts
sitting in diversity are guided by state court interpreta-
tions of state law”); Adventure Outdoors, 552 F.3d at 1300
(same); Mikulski, 501 F.3d at 560 (“We are mindful that
state courts are generally presumed competent to inter-
pret and apply federal law.” (citation omitted)).
In short, the patent-related malpractice claims over
which we have extended our jurisdictional reach require
only application of patent laws to the facts of a case, and
they do not implicate the “validity, construction, or effect”
of the patent laws. Grable, 545 U.S. at 313 (quoting
Shulthis v. McDougal, 225 U.S. 561, 569 (1912)). In other
words, “[w]hat the Court said about Grable in Empire
Healthchoice can be said here too. We have a fact-specific
application of rules that come from both federal and state
law rather than a context-free inquiry into the meaning of
a federal law.” Bennett, 484 F.3d at 910. Accordingly,
these malpractice cases present questions that are noth-
ing like the pure interpretation of the federal tax code
provision at issue in Grable.
Second, although the federal government has an in-
terest in the uniformity of patent law, state court adjudi-
cation of patent-related malpractice actions does not pose
a serious threat to that interest. Most of the recent
malpractice cases on this court’s docket turn on state law
17 BYRNE v. WOOD HERRON
matters such as statutes of limitations, statutes of repose,
or evidentiary issues. E.g., Memorylink Corp. v. Motorola,
Inc., Case No. 1:09-cv-7401 (N.D. Ill. Aug. 5, 2010), ECF
No. 75 (granting motion to dismiss malpractice claim as
barred by the Illinois statutes of limitations and repose),
aff’d, 2011 WL 6095502 (Fed. Cir. Dec. 8, 2011); Byrne v.
Wood, Herron & Evans, LLP, 2011 WL 5600640, at *5
(Fed. Cir. Nov. 18, 2011) (finding that district court
abused its discretion in excluding expert testimony under
Kentucky law); USPPS, Ltd. v. Avery Dennison Corp.,
2010 WL 2802529 (W.D. Tex. June 4, 2010) (finding that
fraud and breach of fiduciary duty claims are barred by
the statute of limitations under Texas law), appeal dock-
eted, No. 2011-1525 (Fed. Cir. Aug. 15, 2011). Even where
a state court would be required to opine on issues of
patent law, its decisions would have no precedential effect
on federal case law. See Adventure Outdoors, 552 F.3d at
1301 (“[T]he state court interpretation of the gun statutes
will not be controlling in numerous other cases because it
will not have precedential effect in the federal system”).
Further, patent-related malpractice claims do not impli-
cate any underlying patent rights themselves, and instead
require consideration of patent law only to inform the
state law standards of causation or damages. For exam-
ple, a state court’s determination that a plaintiff would
have succeeded on his infringement claim is only relevant
to whether the plaintiff can establish causation for pur-
poses of his malpractice claim; it does not result in an
adjudication that the defendant in the prior action was an
infringer.
Unlike in Grable, these cases also do not present
situations that require courts to determine whether an
action of a federal agency complied with a federal statute.
Empire Healthchoice, 547 U.S. at 700 (explaining that
Grable “centered on the action of a federal agency (IRS)
BYRNE v. WOOD HERRON 18
and its compatibility with a federal statute”). These are
actions between two private parties, and the federal
government’s interest in uniformity of patent laws does
not extend to a civil dispute between a client and his
lawyer over the adequacy of the lawyer’s representation.
See Singh, 538 F.3d at 339 (“It cannot be said that federal
trademark law evinces any substantial federal interest in
regulating attorney malpractice.”); Mikulski, 501 F.3d at
570 (“While the federal government may have an interest
in the uniform application of regulations that relate to the
collection of taxes, it has only a limited interest in private
tort or contract litigation over the private duties involved
in that collection.”).
Allowing state courts to resolve malpractice actions,
moreover, does not restrict the ability of any federal
agency to vindicate its rights in a federal forum. Unlike
in Grable, which recognized the government’s strong
interest in “the ability of the IRS to satisfy its claims from
the property of delinquents,” 545 U.S. at 315, state court
adjudication of patent-related malpractice claims does not
impair the PTO’s ability to operate. For example, if a
state court finds that, but for an attorney’s claim-drafting
error, a patent likely would have issued, that determina-
tion does not sidestep the PTO’s examination process and
result in a duly issued patent. It merely supports the
causation element of the plaintiff’s malpractice claim.
That is far different from Grable, where a state court
would be deciding whether the IRS’s seizure notice was
effective based on its interpretation of the federal tax code
provision at issue.
Finally, resolution of the patent issue in these mal-
practice actions will not be dispositive. The patent issues
in these cases relate to the causation or damages element
of the plaintiff’s state law claim; state law generally
requires malpractice plaintiffs also to prove breach – i.e.,
19 BYRNE v. WOOD HERRON
that the defendant attorney breached a duty of care to the
plaintiff or did not exercise the ordinary care of a rea-
sonably competent attorney. Thus, in this case for exam-
ple, if Byrne can prove that a broader patent could have
issued, Kentucky law still requires him to prove that his
attorneys, in acquiescing to the examiner’s requirement to
add to a claim limitation, neglected their duty to exercise
the ordinary care of a reasonably competent attorney.
Stephens v. Denison, 150 S.W.3d 80, 81 (Ky. Ct. App.
2004). The fact that the patent issue in a malpractice
action is not the sole, dispositive issue in the case strongly
cuts against the conclusion that it is a “substantial” one.
See, e.g., Franchise Tax Bd., 463 U.S. at 26 (explaining
that, if “there are many reasons completely unrelated to
the provisions and purposes of [the patent laws] why the
[plaintiff] may or may not be entitled to the relief it
seeks,” then the claim does not “arise under” those laws.
(footnote omitted)).
Despite the many factors that militate against finding
that a patent law issue in a malpractice case is not “sub-
stantial,” our case law has given the question of substan-
tiality only cursory consideration. In our seminal decision
on this issue, the panel in AMT found that the issue of
hypothetical patent infringement was “substantial”
merely because it was a necessary element of the plain-
tiff’s malpractice claim. AMT, 504 F.3d at 1269 (“[P]atent
infringement is a ‘necessary element’ of AMT’s malprac-
tice claim and therefore apparently presents a substantial
question of patent law conferring § 1338 jurisdiction.”
(citing Christianson, 486 U.S. at 809)). In other words,
the panel equated substantiality with whether the federal
issue would actually need to be resolved in the context of
the state law claim. As the discussion above demon-
strates, the analysis in AMT is not only incomplete, it is
incorrect.
BYRNE v. WOOD HERRON 20
By finding that whenever a federal issue is a neces-
sary element of a plaintiff’s state law claim, the federal
issue automatically is a substantial one, our case law has
collapsed the inquiry and discarded substantiality as a
separate consideration. But that is contrary to
Christianson, as clarified in Grable, which expressly
requires that a federal issue be both necessary and sub-
stantial. See Grable, 545 U.S. at 314 (“It has in fact
become a constant refrain in such cases that federal
jurisdiction demands not only a contested federal issue,
but a substantial one, indicating a serious federal interest
in claiming the advantages thought to be inherent in a
federal forum.”); Merrell Dow, 478 U.S. at 810 (“[T]he
mere presence of a federal issue in a state cause of action
does not automatically confer federal-question jurisdic-
tion.”); Adventure Outdoors, 552 F.3d at 1299 (“Although
the plaintiffs’ complaint raises a contested federal issue,
the nature of the dispute between the parties suggests
that this issue does not meet Grable's substantiality
requirement.”); Mikulski, 501 F.3d 572-73 (6th Cir. 2007)
(finding no jurisdiction, even where the federal issue was
a necessary element and actually disputed, because the
federal issue was not “substantial”). Because this court’s
analysis is erroneous, and because the patent issues in
patent-related malpractice actions are not “substantial,”
§ 1338 jurisdiction does not extend to such cases. For that
reason alone, our case law holding otherwise should be
overruled.
2.
Our case law conflicts with Supreme Court precedent
in another way as well. As noted above, Grable also
requires courts to consider whether a state law claim is
one “which a federal forum may entertain without dis-
turbing any congressionally approved balance of federal
and state judicial responsibilities.” Grable, 545 U.S. at21 BYRNE v. WOOD HERRON
314. Thus, even if a patent issue is substantial and
disputed, § 1338 jurisdiction will not lie if federal jurisdic-
tion would upset the federal-state division of judicial
labor. Id. at 313-14. Exercising § 1338 jurisdiction over
patent-related malpractice claims fails this analysis.
As the Fifth Circuit noted in Singh, the argument for
extending federal jurisdiction over malpractice claims
involving a federal issue “reaches so broadly that it would
sweep innumerable state-law malpractice claims into
federal court.” 538 F.3d at 340. Because all malpractice
plaintiffs must prove that they would have prevailed in
the prior suits, or otherwise would have achieved a better
outcome, “federal jurisdiction could extend to every in-
stance in which a lawyer commits alleged malpractice
during the litigation of a federal claim.” Id. Such a result
violates Grable’s federalism concerns, and there is no
reason why the same analysis should not apply to mal-
practice actions in which the underlying federal claim
involves patent law.
By contrast, however, in AMT we reasoned that “we
would consider it illogical for the Western District of
Texas to have jurisdiction under § 1338 to hear the under-
lying infringement suit and for us then to determine that
the same court does not have jurisdiction under § 1338 to
hear the same substantial patent question in the ‘case
within a case’ context of a state malpractice claim.” AMT,
504 F.3d at 1269. But that is precisely the logic that
would sweep into the federal courts every case in which an
allegation of malpractice stemmed from an underlying
federal matter. Such an approach directly conflicts with
what Grable contemplated – the “rare” state law claim
that invokes federal jurisdiction and has only “a micro-
scopic effect on the federal-state division of labor.”
Grable, 545 U.S. at 314. It is also inconsistent with the
view that such cases are the “special and small category”
BYRNE v. WOOD HERRON 22
of cases where federal jurisdiction over a state law cause
of action is appropriate. Empire Healthchoice, 547 U.S. at
699.
Indeed, in only the little more than four years since
we decided AMT and Immunocept, this court’s docket of
patent-related malpractice cases, or the equivalent cases
involving attorney fraud or breach of fiduciary duty,
demonstrates that these are not the “rare” or “special and
small category” of cases. In addition to the five decisions
identified above, including AMT and Immunocept, this
court heard argument in four more similar cases, includ-
ing the present case, since May 2011 alone. 7 See Byrne v.
7 There are also more patent-related malpractice
cases that do not reach this court either because a state
court has disagreed with our analysis, thus preventing
the matter from entering the federal court system, or
because district courts – somewhat brazenly perhaps –
have chosen not to follow our analysis in a removed
action, resulting in remand orders that we lack jurisdic-
tion to review. See New Tek Mfg., Inc. v. Beehner, 751
N.W.2d 135, 144 (Neb. 2008) (“New Tek II”) (refusing to
reconsider its prior finding that state court jurisdiction
was proper, even in light of our AMT and Immunocept
decisions); Genelink Biosciences, Inc. v. Colby, 722 F.
Supp. 2d 592, 598-99 (D.N.J. 2010) (remanding a patent-
related legal malpractice case for lack of subject matter
jurisdiction); ARC Prods., L.L.C. v. Kelly, 2010 WL
4363427, at *2 (E.D. Mo. Oct. 27, 2010) (acknowledging
our cases but siding with a contrary district court decision
in deciding to remand a patent malpractice action). We
have noted the awkward situation this court faces when it
receives appeals over which it lacks jurisdiction but which
clearly are contrary to the court’s case law. See, e.g.,
Genelink BioSciences, Inc. v. Colby, 423 Fed. Appx. 977,
978 (Fed. Cir. May 25, 2011) (“While the District of New
Jersey’s jurisdictional determination appears contrary to
this court’s precedent, it does not follow that this court
has authority to grant Colby’s requested relief.”); ARC
Products, L.L.C. v. Kelly, 424 Fed. Appx. 944, 945 (Fed.
23 BYRNE v. WOOD HERRON
Wood, Herron & Evans, LLP, 2011 WL 5600640 (Fed. Cir.
Nov. 18, 2011); Minkin v. Gibbons, P.C., 2010 WL
5419004 (D.N.J. Dec. 23, 2010), appeal docketed, No.
2011-1178 (Fed. Cir. Jan. 24, 2011); Memorylink Corp. v.
Motorola, 2011 WL 6095502 (Fed. Cir. Dec. 8, 2011);
USPPS, Ltd. v. Avery Dennison Corp., 2010 WL 2802529(W.D. Tex. June 4, 2010), appeal docketed, No. 2011-1525
(Fed. Cir. Aug. 15, 2011). This trend will only increase, as
the number of patent-related malpractice cases is on the
rise. See Christopher G. Wilson, Embedded Federal
Questions, Exclusive Jurisdiction, and Patent-Based
Malpractice Claims, 51 WM. & MARY L. REV. 1237, 1240
(2009) (“[A]ggrieved clients are bringing more claims
against patent attorneys” (citing Am. Bar Ass’n Standing
Comm. on Lawyers’ Prof’l Liab., Profile of Legal Malprac-
tice Claims 2004-2007, at 4 tbl. 1 (2008)). Accordingly, far
from having a “microscopic effect” on the federal-state
division of judicial labor, we have appropriated authority
over an entire of class of state law claims that tradition-
ally belong in state court.
Because our circuit is an outlier, moreover, our case
law produces the odd result that malpractice claims
stemming from an underlying federal suit will only belong
in federal court when the federal issue is one of patent
law. That result is peculiar because states undoubtedly
have a strong interest and role in regulating the conduct
of all of their respective attorneys, as well as in protecting
all of their residents from negligent legal services. E.g.,
Custer, 89 F.3d at 1167 (“[T]he law governing legal mal-
practice represents a traditional exercise of state author-
Cir. May 25, 2011) (“This court has recently issued deci-
sions that appear to directly undermine the district
court's jurisdictional determination . . . . Nonetheless, we
agree with ARC that this court is precluded from exercis-
ing jurisdiction over the district court’s remand order.”).
BYRNE v. WOOD HERRON 24
ity.”); cf. Middlesex Cnty. Ethics Comm. v. Garden State
Bar Ass’n, 457 U.S. 423, 434 (1982) (in determining that
federal courts should abstain from interfering in state bar
disciplinary proceedings, finding that “[t]he State of New
Jersey has an extremely important interest in maintain-
ing and assuring the professional conduct of the attorneys
it licenses.”). But we have usurped the states’ role when
those attorneys happen to practice patent law, or when
residents of the state happen to seek legal counsel for a
patent law issue. That result is not tenable under any
application of the Grable test, and there is nothing in our
decisions that justifies it.
When we addressed Grable’s federalism concerns, the
panel in AMT engaged in only a short analysis, noting
simply that “[t]here is a strong federal interest in the
adjudication of patent infringement claims in federal
court because patents are issued by a federal agency,”
litigants will benefit from federal judges who have patent
experience, and “[i]n § 1338, Congress considered the
federal state-division of labor and struck a balance in
favor of this court’s entertaining patent infringement.”
AMT, 504 F.3d at 1272. There are several problems with
the AMT panel’s reasoning. While it is true that there is
a strong federal interest in the adjudication of “patent
infringement” in federal court, and that Congress in-
tended that this court would entertain “patent infringe-
ment” actions, we are dealing with state law tort claims,
not patent infringement actions. State courts addressing
the traditional state law domain of attorney malpractice
only will need to consider patent law issues to the extent
necessary to determine whether a tort plaintiff has shown
causation or established a right to damages. Indeed,
within the context of a state law malpractice claim, any
question that ostensibly involves application of patent law
would be a factual question, left to the fact-finder to
25 BYRNE v. WOOD HERRON
decide based on the testimony of competing experts, who
could opine on whether a judgment of infringement would
have been likely, a hypothetical patent would have issued,
or a defense of inequitable conduct might have succeeded.
That is like any other malpractice case, where experts are
called upon to opine on whether a plaintiff would have
fared better if the defendant exercised greater care.
The AMT panel’s analysis of the federalism issue is
also so basic that it would apply to every underlying
federal issue. In any matter involving a federal issue,
there will always be some federal interest in having the
matter proceed in federal court, and litigants will always
benefit to some degree from having the judges in those
courts hear the matter. But we must be mindful of the
fact that the patent issues in these cases are only inciden-
tal to the state law tort claim, and that states have at
least an equally strong interest in adjudicating allega-
tions of attorney negligence. Accordingly, simply reciting
a federal interest in patent law uniformity is not enough.
Three justices of the Texas Supreme Court, in dissent,
recently criticized this court’s federalism analysis on
these very grounds, expressing the view that,
“[u]nfortunately, the Federal Circuit has not remained
faithful to the Supreme Court’s federalism inquiry in the
context of malpractice decisions arising from patent
cases,” and that, “under the Federal Circuit’s approach,
the federalism element is simply an invocation of the need
for uniformity in patent law.” Minton v. Gunn, 355
S.W.3d 634, 652 (Tex. 2011) (Guzman, J., dissenting).
Allowing state courts to decide patent-related mal-
practice claims simply does not pose a threat to the uni-
formity of patent law. State court decisions addressing
patent law issues in the context of a state law tort claim
would have no precedential effect on federal courts. See
Tafflin v. Levitt, 493 U.S. at 465 (finding that concurrent
BYRNE v. WOOD HERRON 26
state court jurisdiction over RICO claims will not affect
the uniformity of the federal law, because federal courts
“would not be bound by state court interpretations of the
federal offenses constituting RICO’s predicate acts”);
Adventure Outdoors, 552 F.3d at 1301 (“state court inter-
pretation of the gun statutes . . . will not have preceden-
tial effect in the federal system.” (citing Tafflin)). In
addition, the Supreme Court retains ultimate review of
state court actions, which further mitigates any such
concern. See Merrell Dow, 478 U.S. at 815 (“Petitioner’s
concern about the uniformity of interpretation, moreover,
is considerably mitigated by the fact that, even if there is
no original district court jurisdiction for these kinds of
action, this Court retains power to review the decision of a
federal issue in a state cause of action.”).
Practical experience confirms this point. For exam-
ple, in New Tek I and New Tek II, the Nebraska state
courts disagreed with our jurisdictional analysis and ably
resolved a patent-related malpractice action that required
application of patent laws. See New Tek I, 702 N.W.2d
336 (Neb. 2005); New Tek II, 751 N.W.2d 135 (Neb. 2008).
That case required the court to construe the claims of an
expired patent, consider the chances of success in an
infringement action, and resolve an issue relating to
prosecution history estoppel. The state court relied on
and applied the body of patent law this court has devel-
oped to resolve the issues before it, and it addressed the
patent issues to the extent necessary to adjudicate the
plaintiff’s malpractice claim. Not surprisingly, in the
seven years since New Tek I issued, no federal court has
cited the New Tek decisions for any patent law proposi-
tion, or for anything other than the jurisdictional question
I now address. In short, although a state court in Ne-
braska held a Markman hearing to construe the claims of
27 BYRNE v. WOOD HERRON
an expired patent, the uniform nature of federal patent
law has remained intact.
Ultimately, even if it was unclear in 2007 that our
case law would sweep an entire class of state law mal-
practice actions into federal court, our recent experience
renders no doubt about that point. And extending juris-
diction over these cases has done little, if anything, to
promote uniformity in patent law. More often, these
malpractice cases require this court to resolve nuanced
state law issues regarding statutes of limitations or
causation. There is no principled reason why state courts
cannot apply federal patent law to resolve factual issues
relating to causation or damages in state law tort claims,
or why such an application poses any threat to this court’s
interpretation of those laws. In short, there can be little
doubt that extending § 1338 jurisdiction over patent-
related malpractice claims violates Grable’s federalism
concerns.
IV.
Finally, although other courts have begun either to
follow our case law in addressing patent-related state law
claims, or have distinguished our decisions on the grounds
that patent law is unusual, we should not be misled into
believing that those cases endorse our analysis. Rather,
they reflect the deference other courts give to the Federal
Circuit on patent law issues based on our unique appel-
late jurisdiction. 8 Unfortunately, those decisions also
8 Actually, in many instances, they simply reflect
an effort to distinguish our cases – using our experience
in patent matters as a facile way to explain away circuit
case law that is inconsistent with applicable, governing
standards. E.g., Adventure Outdoors, 552 F.3d at 1290
(distinguishing AMT as “best understood in the context of
patent law . . . .”); Steele, 681 F. Supp. 2d at 37 (distin-
guishing the “uniquely federal nature of federal patent
BYRNE v. WOOD HERRON 28
have the consequence of confusing what would otherwise
be a fairly uniform approach among the state and federal
courts. Our case law has poisoned the well, and it will
only serve to exacerbate the federalism concerns identi-
fied in Grable by drawing more and more state law claims
into federal court. As the three dissenting Texas Supreme
Court justices noted in Minton v. Gunn, “the reach of the
Federal Circuit’s section 1338 reasoning is uncabined, and
can potentially sweep any state law case that touches on
substantive patent law (or, for that matter, the other
areas of law covered by section 1338, such as copyright
and trademarks) irrevocably into federal court.” 355
S.W.3d at 653.
Today, we have missed an important opportunity to
correct our case law and to acknowledge that our reading
of Christianson, even if once arguably justified, can no
longer be so.
law” from the “garden variety federal law” of Title VII);
Anderson, 2009 WL 2244622, at *3 (explaining that
“[f]ederal courts are viewed as having developed a special
competency in matters of patent law”).