Wednesday, August 2, 2017

Third Circuit on Attorney Fired for Refusing to Violate Rules of Professional Conduct

The Third Circuit recently issued an interesting precedential opinion in Trzaska v. L'Oreal USA, Inc.

A patent attorney for L'Oreal (the makeup company) claims that he was pressured to submit patent applications that he "did not in good faith believe were patentable" through a company-imposed quota (the patent team allegedly had an annual minimum number of patent applications). He told the company that filing such bad faith patent applications would violate the Rules of Professional Conduct ("RPCs") that he was bound to adhere to as promulgated by the Supreme Court of Pennsylvania and the U.S. Patent and Trademark Office.

Shortly after the attorney protested the quota, the company offered him two severance packages. After he rejected both of the severance packages, L'Oreal fired him. He filed a lawsuit claiming that he was wrongfully terminated in violation of a New Jersey statute that prohibits retaliation against an employee for refusing to violate a law, rule, regulation, or "clear mandate of public policy" (New Jersey Conscientious Employee Protection Act (“CEPA”)).

The Third Circuit reversed the district court's dismissal of the claim and held that he could proceed with his lawsuit because, "an allegation that an employer instructed, coerced, or threatened its patent attorney employee to disregard the RPCs binding him violates a clear mandate of public policy within the meaning of CEPA." The Court noted both the public interest in patents generally and the RPCs.

Sorry, but I have to call out the Court for this one: "Because his allegations against the beauty-products corporation are more than skin-deep, we reverse." Get it? 'Cause it's a makeup company?