United States District Court, E.D. Virginia, Alexandria Division
MICHAEL I. KROLL, Petitioner,
MICHELLE LEE, Undersecretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office, Respondent.
M. Brinkema United States District Judge
I. Kroll, Esq. ("petitioner" or "Kroll"),
has filed a document styled a "Complaint" [Dkt. 1]
alleging that he was improperly suspended from practicing as
a patent attorney before the United States Patent and
Trademark Office ("USPTO"). The USPTO has responded by
treating Kroll's complaint as a petition for review,
citing Local Civil Rule 83.5, which provides that a
"person refused recognition to practice or suspended...
from practice before the [USPTO] may seek judicial review of
such action by filing [in this court] a
petition" for review (emphasis added).
"Response to Petition for Review"
("Resp.") [Dkt. 26]. After obtaining leave of
Court, Kroll filed an Opposition ("Opp.") [Dkt. 33]
and a Supplemental Submission in opposition
("Supp.") [Dkt. 35]. The Court has found that oral
argument would not aid the decisional process, and for the
reasons that follow, will treat this civil action as a
petition for review, which will be denied.
who was represented throughout the administrative process by
counsel,  has not challenged the respondent's
factual findings in the agency proceedings, which this Court
accordingly adopts. See Final Order, [Dkt. 1-1] at 13-20.
is an active member of the New York State Bar and has been a
registered patent attorney since December 6, 1973, with
nearly 80 percent of his work occurring before the USPTO.
Id. at 13. He also maintains several websites, on
which he posts his clients' inventions "in hopes of
attracting potential buyers or investors." Id.
Since 1973, he has been generally aware that an invention
cannot be patented "if the invention is described in a
written publication [or placed on sale] more than one year
before filing a patent application on the invention[J"
Id. at 12-13; see also 35 U.S.C. §
102(b), and he concedes that placing an invention on his
website constitutes publicly describing an invention or
placing it on sale, Final Order, [Dkt. 1-1] at 14.
Accordingly, Kroll normally waits to post an invention on his
website until after he has filed a patent application with
the USPTO for that invention. Id. at 15.
patent practice, Kroll did not have an automated system to
remind him of upcoming deadlines; rather, he manually entered
deadlines into a docket sheet, which he manually searched to
keep track of dates. Id. at 14. He also maintained
his files in "approximately 125 five-drawer filing
cabinets." Id. Although the drawers themselves
were organized by the client's last name, the files
within the drawers were not kept in an organized fashion.
Id. At least one cabinet was labeled
"Applications in Process/Ready to be Filed, " in
which Kroll kept applications before they were filed.
Id. When an application was in fact ready to be
filed, Kroll or one of his employees would pull the file from
that cabinet, file the application with the USPTO, and then
return the file to the "Ready to be Filed" cabinet
until the USPTO confirmed receipt of the application.
Id. at 15. Once the confirmation from the USPTO
arrived, the file would then be moved to the alphabetical
cabinets to await the USPTO's final decision.
2001, Kroll first met with Adil Sersh ("Sersh")
about representing Sersh in connection with an application
for a patent for a traffic control device that Sersh had
invented. Id. at 5. In 2004, Sersh paid Kroll $8,
000 to prosecute the patent application. Id. By
October 15, 2005, Sersh provided Kroll with all the necessary
documents for the application, which Kroll prepared but did
not file. Id. at 16. Instead, on December 3, 2005,
Kroll listed the traffic control device for sale on one of
his websites, marking it as "U.S. Patent: Pending"
even though he had not filed the patent application.
Id. After Kroll listed the device, Sersh's file
was placed in the "S" cabinet, a deviation from
Kroll's system of placing files in the alphabetical
cabinet only after the USPTO has confirmed receipt of a
patent application. Id. Throughout this period,
Kroll "took no action to confirm whether the traffic
control device application had been filed with the USPTO,
" id, and he failed to "file a patent application
for the traffic control device within 12 months of his
posting the invention for sale on his" website,
Id. at 17.
two years later, in August 2007, Kroll found Sersh's
application "by chance, " and realized it should
have been, but had not been, filed with the USPTO.
Id. Without checking his website to determine if the
invention appeared there, or conducting "any additional
investigation into the invention's patentability, "
Kroll filed the application ("the '052
application") for Sersh's traffic control device on
August 13, 2007, and informed Sersh that he had done so.
Id. At the time of filing, Kroll knew that a patent
attorney, by filing "any paper" with the USPTO,
certified to the best of his knowledge "formed after an
inquiry reasonable under the circumstances that... the claims
and other legal contentions therein are warranted by existing
law[.]" Id. at 14; 37 C.F.R. § 10.18(b)
December 28, 2009, the USPTO sent Kroll an "Office
Action" raising written description and obviousness
concerns about the '052 application, which required
further response for the application to proceed. Final Order,
[Dkt. 1-1] at 17; [Dkt. 18-2] at 85-97. Kroll informed Sersh
about the Office Action, requested a $2, 375 fee to respond
to it, and alerted Sersh that failure to respond would
constitute abandonment of the application. Final Order, [Dkt.
1-1] at 17-18. Sersh did not respond, Kroll did not contact
him again, and no response to the Office Action was filed.
Id. at 18. Consequently, the USPTO sent Kroll a
Notice of Abandonment for the '052 application on July 7,
2010, about which he did not inform Sersh. Id.
has had other run-ins with disciplinary authorities both
before and after the incident that gave rise to this
proceeding. In 2004, the USPTO suspended him from practice
for three years for charging an excessive fee, giving false
or misleading information to the USPTO, and creating false
evidence, although this suspension was "stayed pending
compliance with the terms of a settlement agreement[.]"
Id. at 19. The New York Supreme Court publicly
censured him in 2006, reminding him "not to neglect
patent applications[.]" Id. at 18. In 2010, the
USPTO suspended him for 60 days for permitting an application
to be abandoned by failing to inform the USPTO that foreign
patent applications for the same invention had been filed.
Id. at 19. This suspension, too, was stayed.
February 28, 2014, based on Kroll's handling of the Sersh
application, the director of the USPTO's Office of
Enrollment and Discipline filed a disciplinary complaint
alleging ten violations of the USPTO Rules of Professional
Conduct. Id., at 20. On April 24, 2015, an administrative law
judge ("ALJ") found that three violations had been
proven: (1) engaging in disreputable or gross misconduct in
violation of 37 C.F.R. § 10.23(a); (2) signing a paper
filed with the USPTO without first conducting a reasonable
inquiry in violation of 37 C.F.R. §§10.18 and
10.23(a); and (3) neglecting a legal matter entrusted to him
in violation of 37 C.F.R. § 10.77(c). Id. at
21. Considering these violations and Kroll's disciplinary
history, the ALJ imposed a two-year suspension. Id.
appealed to the Director of the USPTO, who affirmed the ALJ
on March 4, 2016, Id. at 35, and denied
reconsideration on May 18, 2016, Id. at 8. The order
denying Kroll's motion for reconsideration informed him
that he had 30 days from the date of that order to seek
judicial review of his suspension. Id. Kroll filed
his "complaint" in this court on June 21, 2016.
discussion As an initial matter, the parties disagree over
the nature of this civil action and, consequently, the
appropriate standard of review. The USPTO argues that it is
appropriately characterized as a "petition for
review" under 35 U.S.C. § 32 and this court's
Local Civil Rule 83.5, and that a deferential standard of
review applies. Kroll argues that the procedures set out in
§ 32 and Rule 83.5 are unconstitutional and that this
dispute should be treated like any other civil complaint
filed in this court in the first instance and be reviewed de
merits, Kroll contends that he cannot be suspended unless he
violated the USPTO's practice rules with wrongful intent.
Respondent argues that Kroll's complaint was untimely and
that the rules in ...