This is the first of two articles addressing recent guidance provided through our ethics inquiry process relating to conflicts of interest. The second article on this topic can be found here.
Scenario
You are prosecuting a trademark for Client B. You previously represented Client A in a trademark application. A registered mark or a mark in a co-pending trademark application of Client A is cited against the trademark application you are prosecuting for Client B. Does this scenario result in a conflict of interest requiring your withdrawal from representing Client B?
Code of Conduct
The starting point to consider any conflicts issue is to consider the guidance provided in the Code of Conduct:
In Part 3 Conflicts of Interest, the Principle states:
In each matter, an agent’s judgment and loyalty to the client’s interest must be free from compromising influences.
Part 3, Rule 3 sets out factors for agents to consider when engaging in a conflicts analysis including:
- The immediacy of the clients’ interests;
- Whether the clients’ interests are directly adverse;
- The temporal relationship between the matters;
- The significance of the issue to the immediate and long-term interests of the clients involved; and
- The clients’ reasonable expectations in retaining the agent for the particular matter or representation.
Rule 6(1) Acting against Former Clients, Commentary, also provides some additional guidance:
This Rule prohibits an agent from attacking the work done during the retainer or from undermining the client’s position on a matter that was central to the retainer. It is not improper for an agent to act against a former client in a fresh and independent matter wholly unrelated to any work the agent has previously done for that client if previously obtained confidential information is not relevant for that matter.
Analysis
With these rules in mind, we can then turn to the specific situation. Given the factors that the rules ask us to consider, every conflicts analysis is highly fact-specific. An assessment of the risk of a conflict will depend on further fact-specific information. In the hypothetical scenario described above, as a starting point, additional following facts would be helpful to consider:
- Is Client A a current client of yours?
- Is the cited trademark of Client A still in force, or is the application still pending?
- Are or were you actually responsible for the cited trademark application/prosecution for Client A?
- Were you ever in possession of any confidential information concerning the cited trademark? For example, did you only assume responsibility after registration/grant for handling maintenance fees?
- Are you aware of any plans by Client A to assert their own trademark rights against Client B in connection with the subject matter?
Conclusion
As the above general scenario demonstrates, potential conflict issues can arise in everyday practice, and how to address them requires consideration of the guidance provided by the Code of Conduct, and considering the specific situation based on the facts available.
Based on the scenario above, and depending on the relevant factual circumstances:
- When an agent is or was the agent of record who prosecuted both Client A’s cited trademark and Client B’s pending application, it is possible to see how there is a substantial risk that advising Client B about their rights in the face of Client A’s trademark could interfere with the agent’s duties of loyalty to Client A.
- In other words, when an agent is or was the agent of record who prosecuted both Client A’s cited application and Client B’s pending application, there is the possibility that disparagement of Client A’s application might give rise to a breach of a duty owed to Client A, but its impact on Client A could be highly speculative;
- If an agent did not prosecute Client A’s trademark but otherwise has an ongoing client relationship with Client A, there may be a business conflict of interest, but perhaps not a legal or ethical conflict of interest
As always, this guidance is provided to our licensees to help you conduct your own ethical analysis in each case, which must be done in light of all relevant facts and considerations in the matter. This guidance should not be relied upon to replace an agent’s own professional judgment. We welcome the opportunity to receive your ethical questions and provide guidance.