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Supreme Court: state courts may hear malpractice claims arising out of patent disputes

The US Supreme Court [official website] on Wednesday ruled unanimously [opinion, PDF] in Gunn v. Minton [SCOTUSblog backgrounder] that federal law does not deprive state courts of subject matter jurisdiction over a state law claim alleging legal malpractice in a patent case. Delivering the opinion, Chief Justice John Roberts wrote that while federal courts have exclusive jurisdiction of all cases arising under patent law pursuant to 28 USC § 1338(a) [text], the court recognized more than a century ago in New Marshall Engineering Co. v. Marshall Engineering Co. [opinion] that not every question involving a patent-related subject must be heard in a federal forum. Roberts reasoned that although the state court would be forced to answer a question of patent law to resolve Minton's legal malpractice claim, the "answer will have no broader effects" because "[i]t will not stand as binding precedent for any future patent claim" nor "even affect the validity of Minton's patent." Finding that there was "no serious federal interest in claiming the advantages thought to be inherent in a federal forum," the court concluded that federal law does not deprive the state courts of subject matter jurisdiction in hearing the claim.

The Supreme Court heard oral arguments [transcript; audio] in the case last month. The suit arose out of computer programmer Vernon Minton's claim of patent infringement against the National Association of Securities Dealers, Inc. and NASDAQ Stock Market, Inc. [corporate websites] in 2000, where he was represented by attorney Jerry Gunn. There, Minton's case was dismissed on summary judgment by the US District Court for the Eastern District of Texas [official website] on grounds that Minton's patent was invalid under the "on sale bar" of 35 USC § 102 [text]. On appeal for reconsideration, Minton unsuccessfully argued for the first time that his patent fell within the "experimental use" exception of the federal law. On further appeal, the US Court of Appeals for the Federal Circuit [official website] affirmed [opinion], ruling that the "experimental use" argument was waived because it was not raised initially in the district court. Minton subsequently sued Gunn for legal malpractice in Texas state court, but was similarly defeated on summary judgment. On appeal, Minton argued for the first time that the state court lacked subject matter jurisdiction to hear his claim against Gunn, and he should therefore be allowed to begin anew in federal court. Although the Supreme Court of Texas [official website] agreed with Gunn [opinion], the US Supreme Court's ruling on Wednesday effectively reverses that judgment and remands for further proceedings.

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