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Alzheimer's Institute of America, Inc. v. Avid Radiopharmaceuticals

December 7, 2011

ALZHEIMER'S INSTITUTE OF AMERICA, INC.
v.
AVID RADIOPHARMACEUTICALS, ET AL.



The opinion of the court was delivered by: Savage, J.

MEMORANDUM OPINION

In this patent infringement action, the Bryan Cave attorneys representing the plaintiff, Alzheimer's Institute of America, Inc. ("AIA"), filed a motion to withdraw after learning that the University of South Florida Board of Trustees ("USF"), an intervenor in the action, was currently represented by different attorneys at Bryan Cave in unrelated patent prosecution and licensing matters. USF refused to consent to Bryan Cave's continuing its representation of AIA.

After a hearing on Bryan Cave's motion, we issued an order denying Bryan Cave's motion.*fn1 A written opinion was not issued at that time.*fn2 We now issue this memorandum opinion to explain our reasoning.

Background and Procedural History*fn3

The patents in suit are for technology related to Alzheimer's disease, including nucleic acids coding for the so-called "Swedish mutation" and transgenic mice carrying the mutation. Alzheimer's disease is the result of neuronal death believed to be caused by aggregations in the brain of plaques formed by a peptide known as beta-amyloid, which is released from a larger protein, the amyloid precursor protein ("APP"). A mutation in the APP gene, called the Swedish mutation, is believed to be the cause of the release of beta-amyloid plaques leading to Alzheimer's disease.

In 1992, Michael Mullan ("Mullan"), while employed by USF, discovered the "Swedish mutation." The patent application for the Swedish mutation naming Mullan as the sole inventor was filed one month later, on June 4, 1992. On July 15, 1992, Mullan executed an assignment to AIA of his rights in the invention, including any patents or continuations. The assignment was recorded in the U.S. Patent and Trademark Office on July 31, 1992.

On October 3, 1995, the first of the patents in suit issued from the June 4, 1992 application as U.S. Patent No. 5,455,169 for a nucleic acid encoding an APP protein carrying the Swedish mutation, along with vectors comprising the nucleic acid and cell lines containing the nucleic acid. On March 8, 2007, Mullan filed a continuation application, again naming himself as the sole inventor. On May 26, 2009, the continuation application issued as U.S. Patent No. 7,538,258 for transgenic mice carrying the nucleic acid and for screening methods for an agent for treating Alzheimer's using such mice. This patent was assigned to AIA pursuant to the original assignment.

On November 24, 2010, AIA, represented by Bryan Cave, brought this action alleging patent infringement by Avid Radiopharmaceuticals and The Trustees of the University of Pennsylvania. After discovery limited to the issue of standing concluded, the parties filed cross-motions for summary judgment. The defendants contended that the assignor of the patents, Mullan, was not the sole inventor of the invention; and, even if he were, ownership of the invention vested in his university-employer USF by operation of Florida law. AIA argued that Mullan was the sole inventor and the legal owner of the patents, giving rise to a presumption of validity of the patents.

We issued an opinion holding that pursuant to Florida law, the rights to the invention vested in USF because the purported inventor, Mullan, who had executed an assignment to AIA of his rights in the invention, was employed by USF at the time the invention was conceived and the invention was in the field or discipline of Mullan's employment. Because we determined that there were contested material facts relating to whether USF had waived its ownership rights in the invention, we scheduled a trial on the waiver issue and on whether Mullan was the sole inventor. USF then filed its motion to intervene, which we granted.

When USF sought to intervene in the action, Bryan Cave conducted a conflicts check. It learned that USF was currently represented by different attorneys at Bryan Cave in unrelated patent prosecution and licensing matters. When USF refused to consent to Bryan Cave's representation of AIA in this litigation, Bryan Cave filed a motion to withdraw as counsel. After an evidentiary hearing, we entered an order, without opinion, denying Bryan Cave's motion to withdraw.*fn4

After the order denying the motion to withdraw was entered, USF filed a motion for certification pursuant to 28 U.S.C. § 1292(b) requesting that the court certify its order for review by the United States Court of Appeals for the Federal Circuit. We denied the motion.

Pennsylvania Law Applies

In a diversity action,*fn5 the court "must apply the choice of law rules of the forum state to determine what substantive law will govern." Huber v. Taylor, 469 F.3d 67, 73 (3d Cir. 2006) (quoting Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941)). Accordingly, we turn to Pennsylvania's choice of law rules to determine the applicable law.

Local Rule of Civil Procedure 83.6, Part IV(B) states that the "Rules of Professional Conduct adopted by this court are the Rules of Professional Conduct adopted by the Supreme Court of Pennsylvania." Thus, the Pennsylvania Rules of Professional Conduct govern the conduct of attorneys appearing before this court.

On an issue involving a lawyer's professional responsibility while representing a client in a Pennsylvania court, the applicable choice of law rule is Rule 8.5 of the Pennsylvania Rules of Professional Conduct. This Rule states:

(a) Disciplinary Authority. A lawyer admitted to practice in this jurisdiction is subject to the disciplinary authority of this jurisdiction, regardless of where the lawyer's conduct occurs. A lawyer not admitted in this jurisdiction is also subject to the disciplinary authority of this jurisdiction if the lawyer provides or offers to provide any legal services in this jurisdiction. A lawyer may be subject to the disciplinary authority of both this jurisdiction and another jurisdiction for the same conduct.

(b) Choice of Law. In any exercise of the disciplinary authority of this jurisdiction, the rules of professional conduct to be applied shall be as follows:

(1) for conduct in connection with a matter pending before a tribunal, the rules of the jurisdiction in which the tribunal sits shall be applied, unless the rules of the tribunal provide otherwise; and

(2) for any other conduct, the rules of the jurisdiction in which the lawyer's conduct occurred, or, if the predominant effect of the conduct is in a different jurisdiction, the rules of that jurisdiction shall be applied to the conduct. A lawyer shall not be subject to discipline if the lawyer's conduct conforms to the rules of a jurisdiction in which the lawyer reasonably believes the predominant effect of the lawyer's conduct will occur. (boldface added).

The explanatory comment to Rule 8.5 provides, in pertinent part:

2. A lawyer may be potentially subject to more than one set of rules of professional conduct which impose different obligations. The lawyer may be licensed to practice in more than one jurisdiction with differing rules, or may be admitted to practice before a particular court with rules that differ from those of the jurisdiction or jurisdictions in which the lawyer is licensed to practice. Additionally, the lawyer's conduct may involve significant contacts with more than one jurisdiction.

3. Paragraph (b) seeks to resolve such potential conflicts. . . .

4. Paragraph (b)(1) provides that as to a lawyer's conduct relating to a proceeding pending before a tribunal, the lawyer shall be subject only to the rules of the jurisdiction in which the tribunal sits unless the rules of the tribunal, including its choice of law rule, provide otherwise. . . .

Thus, the plain language of Rule 8.5 and its explanatory comment clearly state that if the lawyer's conduct relates to a proceeding pending before a tribunal, the lawyer is "subject only to the disciplinary rules of the jurisdiction in which the tribunal sits." Because Bryan Cave's motion to withdraw pertains to a proceeding pending in this court and the Pennsylvania Rules of Professional Conduct govern this tribunal, Pennsylvania's Rules of Professional Conduct apply in this case.

An earlier version of Rule 8.5 further supports this interpretation. Prior to 2004, Rule 8.5 provided that the applicable rules of professional conduct take into account the jurisdictions in which the attorney had been admitted ...


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