The leadership of the CBA IP Section intends to send the following letter to the Colorado Supreme Court voicing support for the proposed change to C.R.P.C. 8.4(c). If you would like to add your name or your firm’s name to the list of supporters for the letter, please email Matt Holohan at firstname.lastname@example.org by noon on Tuesday, September 5.
Dear Chief Justice Rice and Fellow Justices:
On behalf of the Intellectual Property Section (“IP Section”) of the Colorado Bar Association, I write to provide support for the proposed amendment to Rule 8.4(c) of the Colorado Rules of Professional Conduct.
I also attach as Exhibit A a list of law firms and IP attorneys who have authorized me to identify them as supporting the proposed amendment to Rule 8.4(c).
In its current form, CRCP Rule 8.4(c) prohibits attorneys from “engag[ing] in conduct involving dishonesty, fraud, deceit or misrepresentation.” CRCP Rule 5.3(c) further states that “[w]ith respect to nonlawyers employed or retained by or associated with a lawyer … a lawyer shall be responsible for conduct of such a person that would be a violation of the Rules of Professional Conduct if engaged in by a lawyer if … the lawyer orders or, with the knowledge of the specific conduct, ratifies the conduct involved.” As currently drafted, these and other Rules of Professional Conduct may be interpreted to prohibit otherwise lawful activities that are important not only to investigate whether IP rights (including patents, trademarks, and copyrights) are being infringed, but also to conduct IP-related investigations, such as legally required pre-suit investigations, as required by state and federal rules.
To satisfy prefiling obligations and initiate effective actions to enforce intellectual property rights, IP attorneys often need to obtain samples of allegedly infringing products in order to examine and analyze them, ascertain the source of allegedly infringing products and/or methods, and determine the manner in which allegedly infringing products and/or methods are made or used. For example, in the case of counterfeit goods, before or after commencing an action against an Internet infringer or counterfeiter, a brand owner may hire private investigators to contact the online seller, exchange communication with the seller and purchase infringing or counterfeit goods to ultimately identify the seller and ascertain his or her domicile to understand the scope of use of the protected trademark. These investigations are important because for many types of IP rights violations, the only manner by which a property owner can adequately protect its investment in its intellectual property and avoid diluting such rights is to bring a swift enforcement action. In addition, IP attorneys may need to use investigators in non-adversarial situations. For example, trademark attorneys often use investigators to contact companies to confirm that marks are no longer in use—perhaps by calling a customer service line.
As it currently stands without amendment, Rule 8.4(c) may have the unintended effect of materially hampering the protection of intellectual property rights and decreasing the economic value of intellectual property.
For these and similar reasons, the IP Section and its membership have been focused on education about and guidance concerning Rule 8.4(c) for a significant period of time. In April 2010, the IP Section held a CLE panel event entitled “Using Deception in IP Related-Investigations: Are You Unwittingly Violating The Colorado Rules of Professional Conduct.” Later that year, in October 2010, the IP Section Leadership formally requested guidance concerning Rule 8.4(c) from Colorado Supreme Court Standing Committee on Rules of Professional Conduct. The IP Section’s request led to the extensive work and reports of the Standing Committee and the Subtexting Subcommittee. In December 2012, the IP Section sought the educate its members and other attorneys through a CLE panel event on the result of the Subtexting Subcommittee’s work, featuring several of Subcommittee members, entitled, “Pretexting, Pautler, and the Colorado Rules of Professional Conduct.” Finally, the issue and the IP Section’s efforts were documented in a June 2014 article in the Colorado Lawyer, entitled “Pretext Investigations: An Ethical Dilemma for IP Attorneys,” by Rachel L. Carnaggio (attached as Exhibit B).
Consistent with the IP Section’s prior positions—as well as the 2012 majority recommendation in the Supplemental Report of the Pretexting Subcommittee of the Colorado Supreme Court Standing Committee on the Rules of Professional Conduct—the IP Section supports the proposed clarifying amendment, which adds a limited exception to Rule 8.4(c), such that it reads:
It is professional misconduct for a lawyer to … (c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation, except that a lawyer may advise, direct, or supervise others, including clients, law enforcement officers, or investigators, who participate in lawful investigative activities[.]
The IP Section supports this proposed clarifying amendment for several reasons, including the following. First, the proposed exception provides understandable guidelines for intellectual property attorneys to follow when engaging in presuit investigations. Second, the proposed exception continues to prevent otherwise unlawful activities. Third, the exception allows intellectual property attorneys to use agents, such as professional investigators, to obtain background, identification, purpose, or similar information. Fourth, it permits attorneys’ involvement in presuit investigation, such that attorneys can assist in ensuring that those investigations are lawful.
We appreciate your attention to this important matter and to these comments.
Mary (Mindy) V. Sooter
Chair, IP Section of the Colorado Bar Association