Haley v. Under Secretary of Commerce for Intellectual Property

129 F. Supp. 3d 377, 2015 U.S. Dist. LEXIS 120324, 2015 WL 5277880
CourtDistrict Court, E.D. Virginia
DecidedSeptember 8, 2015
DocketCase No. 1:15-cv-102 (GBL/TRJ)
StatusPublished

This text of 129 F. Supp. 3d 377 (Haley v. Under Secretary of Commerce for Intellectual Property) is published on Counsel Stack Legal Research, covering District Court, E.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Haley v. Under Secretary of Commerce for Intellectual Property, 129 F. Supp. 3d 377, 2015 U.S. Dist. LEXIS 120324, 2015 WL 5277880 (E.D. Va. 2015).

Opinion

[379]*379 MEMORANDUM OPINION AND ORDER

GERALD BRUCE LEE, District Judge.

THIS MATTER is before the Court on Defendants Michelle Lee and Sarah Harris (“Defendants”)’s Motion to Dismiss (Doc. 7) and Petitioner-Plaintiff- Jeffrey Haley (“Haley”)’s Cross-Motion for Partial Summary Judgment (“Cross-Motion”) (Doc. 13). This ease involves the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office (“the USPTO”)’s decision to disbar Haley (Admin. R. at 9-24) as reciprocal punishment after Haley agreed to resign from the Washington State Bar Association (“the WSBA”) in lieu of discipline (Id. at 28-31). Following disbarment, Haley jointly filed (1) a petition for review of the USPTO’s disciplinary ruling and (2) a Bivens action (“Complaint”) against Defendants.

There are five issues before the Court. One, whether the Court, given Haley’s alternative means of redress and the practical implications of allowing such a suit, should grant Defendants’ Motion to Dismiss because it would be inappropriate to devise a new Bivens remedy for Haley’s claims. Two, whether the Court should grant Defendants’ Motion to Dismiss because Defendants are entitled to absolute immunity due to their quasi-judicial roles in adjudicating agency disciplinary actions. Three, whether the Court should grant Defendants’ Motion to Dismiss because Defendants are entitled to qualified immunity as the constitutional right at issue was not clearly established at the time of the alleged misconduct. Four, whether the Court should grant Haley’s Cross-Motion because the USPTO had no congressionally-granted- authority to impose reciprocal discipline against Haley. Five, whether the Court should grant Haley’s Cross-Motion because in punishing Haley, the USP-TO exercised its authority in a manner that was arbitrary and capricious. For the reasons that follow, the Court must GRANT Defendants’ Motion to Dismiss and the Court must DENY Haley’s Cross-Motion.

I. BACKGROUND

Petitioner-Plaintiff Jeffrey Haley was a patent attorney licensed to practice in the state of Washington and.before the United States. Patent and Trademark. Office (“Patent Bar”), but in 2005 Haley decided to leave the law and work instead as a patent agent.1 (Compl. ¶¶ 9-11). In 2006, Haley failed to pay dues or complete the required continuing legal education classes necessary for membership in the WSBA and the WSBA suspended him from practice. (Id. ¶12). That same year, Haley resigned from the law firm which he helped found. (Id. ¶ 14). When the firm refused to pay Haley his retirement, the parties entered arbitration. (Id. ¶ 15). While Haley eventually prevailed, he did not receive attorneys’ fees. The contract at issue did not allow for such relief and accordingly, Haley incurred significant legal costs. (Id. ¶ 14-15). In 2013, Haley’s former firm filed a complaint with the WSBA alleging that Haley had sent the firm a message which it believed constituted criminal extortion and therefore ethical misconduct under the WSBA’s rules. (Id. ¶ 17). The message allegedly read,

I am not satisfied with the arbitrator’s ruling on attorney fees. Giving all benefits of doubts, a reasonable person might [380]*380consider it fair to award no attorney’s fees for all litigation efforts through the summary judgment ruling. However, you should have promptly paid up after that ruling. All theories you- asserted and all actions you took subsequently, including requesting extra time for discovery and then taking no discovery, were frivolous and appeared calculated merely to run up my attorney fees while you incurred no attorney fees.
The additional fees I incurred after the summary judgment were $22,390, and the additional arbitration costs were' $4,005, a total of $26,395.
To treat me with minimal fhirness, I demand that the firm pay me this amount.
If you pay me $26,395, I will have no basis to warn patent lawyers that they should not do business with you. If you do' not, I will exercise my duty to others and post the 'warning below in all suitable places on the web:
I was one of three founders of the Graybeal Jackson patent law. firm in 1990. To minimize risk of wasteful disputes, wé wrote a partnérship agreement that spelled out with clear formulas’ who was entitled to how much money 'in all scenarios, including withdrawal or retirement.
I was the de-facto managing partner from 1995 to 2004. When John Graybeal died, I ensured that the firm paid the appropriate amount to his estate based on the partnership agreement. When Larry Jackson retired, I ensured that the firm paid him the retirement amounts he was due based on the partnership agreement. There was not a single complaint or question raised in either case.
But then, when I retired, with Josh King the leading partner, the firm refused to pay my retirement buy-out (“departure benefits” under the partnership agreement). The partners, Josh King, Dick Gray, Brian Santarelli, Paul Rusyn, and Kevin Jablonski, asserted frivolous legal theories why the departure benefits were not owed. Although my lawyer frequently solicited offers of payment for settlement, Josh King and the Graybeal firm partners offered nothing. A reasonable business person would have assessed the situation and made a reasonable offer. It appears that Josh King, and his partners seek a reputation for a scorched-earth approach to any partner or employee who disagrees with them — not the sort of people you want to do business with.
I was forced to take the matter all the way through arbitration. The arbitrator awarded my full retirement benefits to the penny.. But I incurred $63,134 in attorney fees and $12,680 for arbitration costs, a total of $75,814, to recover the $129,667 that I was owed. -Josh King represented the Graybeal firm so the firm incurred no legal fees while it was running up my bill.
I write to warn associates and prospective partners of the risks of joining this firm, at least so long as Josh King, Dick Gray, Brian Santarelli, Paul Rusyn, and Kevin Jablonski make up a majority of the partners. Spending your money and energy in litigation is not worth' -the potential benefits.
If you would like me to send you a copy of the arbitrator’s ruling, please send an e-mail to haleyconsulting(at)gmail.eom.

The WSBA filed a complaint against Haley alleging misconduct under the Rules of Enforcement Lawyer Conduct (“ELC”) on August 14, 2013. (Admin. R. at 32-35). [381]*381In Haley’s response to the complaint he stated, “It is not worth the trouble for me to go through a disputed proceeding on this matter, so I hereby-permanently resign my former membership which has been in suspension for more than seven years.” (Id. at 36-37). After a series of negotiations with the WSBA which allowed him to resign without actually admitting to the wrongful conduct, Haley signed the Resignation in Lieu of Discipline (Id. at 28-31) pursuant to ELC Rule 9.3 (Id. at 39; see Compl. ¶¶ 19-22).

On June 20, 2014, the Director of the Office of Reciprocal Discipline (“OED”) for the Patent Bar filed a complaint for reciprocal discipline, against Haley pursuant to 37 C.F.R.

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Bluebook (online)
129 F. Supp. 3d 377, 2015 U.S. Dist. LEXIS 120324, 2015 WL 5277880, Counsel Stack Legal Research, https://law.counselstack.com/opinion/haley-v-under-secretary-of-commerce-for-intellectual-property-vaed-2015.