First Circuit Revives Patent Malpractice Claim and Clarifies Attorney-Client Relationship in Joint Patent Prosecution

In BlueRadios, Inc. v. Hamilton, Brook, Smith & Reynolds, P.C., the U.S. Court of Appeals for the First Circuit revived a patent malpractice claim and clarified when an attorney-client relationship may arise in joint patent prosecution. The decision addresses two issues with broader importance for technology companies, patent owners, and law firms: when a legal malpractice claim accrues under Massachusetts law, and when counsel may owe duties to more than one party in a shared patent matter.

Key Takeaways

• Patent malpractice claims may survive early dismissal when there are factual disputes about when the client knew or should have known of the alleged harm.
• An attorney-client relationship in patent prosecution can arise from the parties’ conduct, even without a direct engagement letter or direct payment.
• Joint development and joint patent prosecution arrangements should clearly define representation, authority, information sharing, and conflict procedures.

Background

BlueRadios, a Colorado wireless technology company, collaborated with Kopin, a Massachusetts micro-display company, to develop a headset project known as Golden-i. Their agreement provided that intellectual property developed for the project would be jointly owned, while Kopin would decide whether and how to pursue patent protection and would bear the cost of prosecution.

Kopin retained Hamilton, Brook, Smith & Reynolds, P.C. to handle the patent work. According to the First Circuit, the firm worked with both companies during prosecution, opened billing files related to BlueRadios matters, and received powers of attorney from BlueRadios personnel. BlueRadios later alleged that the firm amended applications in ways that favored Kopin, abandoned at least one application without notice, and filed at least one terminal disclaimer without telling BlueRadios. A terminal disclaimer is a filing that can limit a patent term or tie one patent to another for enforceability purposes.

The parties’ business relationship ended in 2009. Years later, when BlueRadios reviewed its patent portfolio in connection with potential business activity and related litigation, it claimed it discovered conduct that supported malpractice and related claims. The district court entered summary judgment for the law firm, holding that the claims were time-barred and that no attorney-client relationship existed between BlueRadios and the firm. BlueRadios appealed.

What the First Circuit Decided in the Patent Malpractice Appeal

Reversed in part. The First Circuit held that BlueRadios’ legal malpractice claim should not have been dismissed on summary judgment as untimely. Under Massachusetts’ discovery rule, a malpractice claim generally accrues when the plaintiff knew or reasonably should have known that it suffered appreciable harm caused by the lawyer’s conduct. The court concluded that this timing issue presented factual disputes for a jury.

Also reversed on the relationship issue. The court further held that an attorney-client relationship existed between BlueRadios and the firm as a matter of law during the relevant patent prosecution work. That point was significant because the malpractice claim depended on the existence of a professional duty running to BlueRadios.

Vacated in part and remanded. The First Circuit vacated related rulings tied to the district court’s analysis and sent the case back for further proceedings. In practical terms, the decision allows the malpractice case to continue rather than ending at the summary judgment stage.

Why the Court Revived the Patent Malpractice Claim

The court focused on four points.

• Accrual was fact-intensive. The record did not permit the court to decide, as a matter of law, exactly when BlueRadios knew or should have known it had suffered actionable harm. The technical nature of patent prosecution mattered to that analysis.
• An engagement letter was not dispositive. The absence of a direct engagement letter or direct payment by BlueRadios did not defeat an attorney-client relationship. The court looked to the parties’ conduct and whether BlueRadios sought and received legal assistance.
• Joint patent prosecution can create duties to more than one client. The court emphasized that attorneys working on a common legal matter, including patent prosecution, may owe duties to multiple aligned parties.
• Evidence of direct interaction mattered. The court relied on facts such as BlueRadios’ separate communications with the firm, disclosure of confidential information, execution of powers of attorney, and requests concerning claim scope. Those facts supported the conclusion that the firm represented BlueRadios in the prosecution work at issue.

The opinion did not decide the ultimate malpractice claim on the merits. It decided that BlueRadios had enough to proceed and that key issues, especially timing, could not be resolved against it on this record at summary judgment.

What Technology Companies and Patent Owners Should Do Now

For companies that co-develop technology, this decision is a useful reminder that patent prosecution arrangements should be documented with precision. If one party controls patent filing strategy, the parties should still define who the lawyers represent, what information may be shared, who has authority to direct prosecution, and how conflicts will be handled if business interests diverge.

Companies should also avoid assuming that public patent filings alone will protect their interests. In a complex prosecution record, a party may not immediately understand the legal significance of amendments, abandonments, inventorship changes, ownership statements, or terminal disclaimers. Internal review procedures and clear communication with prosecution counsel remain important, especially in joint-development settings.

From a law firm risk-management perspective, the case underscores the value of explicit engagement terms, conflict disclosures, and written guidance on whom the firm represents in collaborative IP matters. Where counsel interacts directly with multiple business participants, receives confidential information from each, or acts under powers of attorney for multiple parties, courts may find duties existed even without a conventional bilateral engagement letter.