Seed Company Limited et al v. Westerman et al

REPLY to opposition to motion re MOTION to Dismiss OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT, ON STATUTE OF LIMITATIONS AND CAUSATION GROUNDS

D.D.C.April 25, 2008

1Memorandum of Points and Authorities in Opposition to Defendants’ Motion to Dismiss, or, in the Alternative, for Summary Judgment (hereafter “Opposition”) at 24. UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA SEED COMPANY, LTD., et al, Plaintiffs v. WILLIAM F. WESTERMAN, et al. Defendants. Civil No. 1:08-cv-00355 (RMU) REPLY IN SUPPORT OF WESTERMAN DEFENDANTS’ MOTION TO DISMISS, OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT, ON STATUTE OF LIMITATIONS AND CAUSATION GROUNDS In a stunning failure either to research or acknowledge controlling precedent, Plaintiffs make three losing arguments in an attempt to escape the obvious statute of limitations bar to their claims based on Defendants’ 1997 failure to file an English translation of Plaintiffs’ Patent Cooperation Treaty (“PCT”) Application. Plaintiffs have also failed to demonstrate that they can allege that Defendants’ allegedly negligent advice proximately caused them to reject settlement offers. I. PLAINTIFFS CANNOT DISPUTE THAT THEY WERE ON INQUIRY NOTICE OF THE ALLEGED PROCEDURAL FAILURE TO FILE AN ENGLISH TRANSLATION, AND D.C. LAW EXPLICITLY PROVIDES THAT EVEN NOMINAL DAMAGES TRIGGER THE STATUTE OF LIMITATIONS. Plaintiffs argue that they did not “discover” that they were damaged by Defendants’ alleged failure to file an English translation until the Federal Circuit denied their petition for rehearing on June 10, 2004.1 Plaintiffs acknowledge that under the discovery rule, a claim Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 1 of 17 2Opposition at 18. 3See Second Declaration of William F. Westerman at paragraphs 2, 3, and attachment G to that Declaration, attached hereto as Exhibit 1. - 2 - accrues when the plaintiff “knows, or in the exercise of reasonable diligence should know, of (1) an injury, (2) its cause, and (3) some evidence of wrongdoing. Wagner v. Sellinger, 847 A.2d 1151, 1154 (D.C. 2004).”2 Plaintiffs do not, and cannot, dispute that they were on notice that Defendants had failed to file an English translation of the PCT Application, and that Stevens, the opposing party in the patent interference, was arguing that this failure meant that Stevens’ patent should receive priority. Indeed, in a letter faxed to Defendants in April, 2003, Plaintiffs’ representative noted that the Board of Patent Appeals and Interferences had denied Seed’s motion for reconsideration in a March 13, 2003 decision, and that the Board had ruled that Defendant attorneys failed to file a required English translation of the PCT Application: the problem was caused by the fact that though Tamai was required under CFR to file a translation of the PCT application along with the motion, Tamai did not do so. In other words, if only Tamai had filed said translation, the problem would not have happened. In this sense, the client considers that the problem was caused by a procedural mistake.3 Plaintiffs cannot dispute that they were aware of Defendants’ alleged wrongdoing (failing to file a translation) more than four years before the effective limitations date. However, Plaintiffs say that they were not aware that they were injured, because the thousands of dollars in attorneys’ fees they paid addressing the issue were so “nominal” that they did not trigger the statute of limitations, and because the Board of Patent Appeals and Interferences ruled in their Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 2 of 17 4Opposition at 19-28. - 3 - favor on priority.4 Plaintiffs’ argument that “nominal damages” do not trigger the statute of limitations flies in the face of long-established precedent. As the D.C. Circuit has repeatedly noted, “statutes of limitation begin running when the wrong has been committed, even if at the time ‘no more than nominal damages may be proved, and no more recovered; but on the other hand, it is perfectly clear, that the proof of actual damage may extend to facts that occur and grow out of the injury, even up to the day of the verdict.’” Norwest Bank Minnesota National Association v. FDIC, 354 U.S. App. D.C. 78, 312 F.3d 447, 452 (D.C. Cir. 2002), quoting Wilcox v. Plummer, 29 U.S. (4 Pet.) 172, 182 (1830). See also, Harris v. FAA, 359 U.S. App. D.C. 281, 353 F.3d 1006, 1012 (D.C. Cir. 2004). This has long been the law in the District of Columbia. “‘Nominal damages at least can be recovered immediately upon the happening of the breach, and the Statute of Limitations then begins to run; its operation is not delayed until substantial or consequential damages accrue.’” Reynolds Metals v. McCrea, 99 A.2d 84, 85 (D.C. 1953), quoting Livingston v. Sims, 197 S.C. 458, 15 S.E.2d 770, 772 (S.C. 1941)(other citations omitted). In any event, more than three years before the effective filing date, Seed paid a minimum of $4,000 in attorneys’ fees to file a motion for reconsideration specifically addressing the failure to file an English translation of the PCT Application. Nominal damages generally are entered in the amount of $1; $4,000 is not nominal. In Williams v. Mordofsky, 284 U.S. App. D.C. 52, 901 F.2d 158 (D.C. Cir. 1990), the D.C. Circuit held that the payment of $7,235 in fees to deal with an attorney’s alleged negligence triggered the statute of limitations. Plaintiffs attempt to argue that the triggering date for the statute of limitations has a de Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 3 of 17 5Opposition at 26. 6Indeed, Plaintiffs construct their fanciful “nominal damages” argument from a stray phrase in a quote from a case from another jurisdiction in Knight v. Furlow, 553 A.2d 1232, 1235 (D.C. 1989). The Knight v. Furlow opinion quoted a California case, Budd v. Nixen, 6 Cal. 3d 195, 491 P.2d 433, 436 (Cal. 1971): “The mere breach of a professional duty, causing only nominal damages, speculative harm, or the threat of future harm-not yet realized-does not suffice to create a cause of action for negligence.” That quotation hardly reflects a judgment by the D.C. Court of Appeals that incurring $4,000 in attorneys’ fees dealing with an issue created by an attorneys’ alleged negligence does not trigger the statute of limitations. For the reasons stated below, the holding of Knight v. Furlow is directly to the contrary. 7See Second Declaration of William F. Westerman, paragraphs 2-5. - 4 - minimis exception, based on the percentage of total attorneys’ fees paid, or the percentage of their total alleged damages.5 Tellingly, Plaintiffs cite no authority for this argument.6 The argument is absurd, and would fundamentally defeat the public policy of repose animating statutes of limitations. If plaintiffs could argue that their causes of action did not accrue until they had suffered some undefined “substantial” percentage of their damages, they could frequently defeat motions to dismiss or for summary judgment by arguing that a question of fact existed as to whether the initial damages were a “de minimis” amount of their total damages. In an oversimplification, Plaintiffs say that they won the interference proceeding before the Board of Patent Appeals and Interferences, and thus did not realize that they were damaged. However, as the correspondence between the parties cited in Plaintiffs’ Opposition reveals, Plaintiffs realized that the Board’s ruling that an English translation was required was adverse to their interests, and created a potential issue on appeal to the Federal Circuit, and in any subsequent patent litigation.7 In any event, Plaintiffs do not contest the material fact that indisputably put them on notice of their claim and actual injury by October, 2002. It is undisputed that Plaintiffs paid a Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 4 of 17 - 5 - minimum of $4,000 in October, 2002, to file a motion for reconsideration for the sole purpose of addressing the failure to file an English translation of the PCT Application. That undisputed fact establishes that Plaintiffs were on inquiry notice of the failure to file an English translation, and knew that they suffered actual damages (in the form of attorneys’ fees paid to deal with the issue) as a result. Under D.C. law, that is enough to trigger the statute of limitations: We conclude that attorney’s fees and costs expended as a result of an attorney’s alleged malpractice constitute legally cognizable damages for purposes of stating a claim for such malpractice. See Wettanen [v. Cowper, 749 P.2d 362, 365 (Alaska 1988)](plaintiff- client was injured when he retained new counsel and paid costs of appealing trial court order because of attorney’s alleged negligence); Cantu [v. The St. Paul Companies, 514 N.E.2d 666, 669 (Mass. 1987)](legal fees expended by plaintiff to ameliorate harm caused by alleged legal malpractice considered legal injury); Budd [v. Nixon, 6 Cal.3d 195, 491 P.2d 433, 437, 98 Cal. Rptr. 849 (Cal. 1971)](plaintiff-client compelled to “incur and pay attorney’s fees and legal costs and expenditures” would sustain sufficient injury to run statute of limitations claim). The fact that not all of a client’s damages are finally ascertainable pending the outcome of an appeal may suggest in some circumstances that trial of the malpractice action should be stayed pending the appeal; it does not indicate that the client has not been injured earlier. Knight v. Furlow, 553 A.2d 1232, 1235-36 (D.C. 1989). The best illustration that Plaintiffs were on inquiry notice of the alleged wrongdoing and actual harm by October, 2002, is the following hypothetical: Suppose the Board had granted the motion for reconsideration, and suppose that Seed had won any subsequent appeals to the Federal Circuit. Now suppose that Plaintiffs sued to recover the attorneys’ fees they paid to file the motion for reconsideration. If the failure to file the English translation was negligence, Plaintiffs would have a viable claim. The same statute of limitations analysis would apply, and it would be obvious that Plaintiffs could not assert that they did not realize they were injured until after the Federal Circuit ruled in their favor. In the hypothetical, the attorneys’ fees paid to file the motion for reconsideration would Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 5 of 17 8Havens v. Patton Boggs and other unpublished opinions cited herein are attached hereto as Exhibit 2. - 6 - be Plaintiffs’ only damages; in this case, those fees are part of Plaintiffs’ alleged damages. The outcome before the Board and the Federal Circuit would be irrelevant in a suit to recover the attorneys’ fees paid to file the motion for reconsideration; for the same reason, under Knight v. Furlow, they are irrelevant to the limitations analysis here. Plaintiffs’ attempts to distinguish controlling D.C. case law are unavailing. Knight v. Furlow squarely held that incurring attorneys’ fees to address an attorney’s malpractice triggers the statute of limitations, regardless of the ultimate outcome of the case. 553 A.2d 1235-36. Williams v. Mordofsky, 284 U.S. App. D.C. 52, 901 F.2d 158 (D.C. Cir. 1990), held that spending $7,235 in fees to deal with an attorney’s alleged negligence triggered the statute of limitations, six months before plaintiffs in that case first lost their FCC proceeding. And, as Defendants pointed out in their initial memorandum, Wagner v. Sellinger, 847 A.2d 1151 (D.C. 2004), does not apply here. In that case, defendant presented no evidence that plaintiff had incurred additional attorneys’ fees as a result of the alleged malpractice more than three years before filing suit. The D.C. Circuit noted this crucial distinction in Havens v. Patton Boggs, LLP, 235 Fed. Appx. 750, 2007 U.S. App. LEXIS 11914 at **2-3 (D.C. Cir. 2007) (unpublished) (“While it is true that in some cases the existence of an injury from inferior representation may not be evident until a final verdict, see Wagner v. Sellinger, 847 A.2d 1151, 1156 (D.C. 2004), this is not always the case, see Weisberg v. Williams, Connolly & Califano, 390 A.2d 992, 995 (D.C. 1978)”).8 Because there is no dispute that Plaintiffs knew that they had spent a minimum of $4,000 Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 6 of 17 - 7 - in fees solely to address the failure to file an English translation, and no dispute that Plaintiffs knew that the failure to file the translation was a “procedural error,” Plaintiffs’ discovery requests are unnecessary. No amount of additional discovery can change the fact that Plaintiffs were on inquiry notice of the alleged wrongdoing and resultant damages by at least October, 2002, or March, 2003. II. PLAINTIFFS’ LULLING ARGUMENTS ARE NOT RELEVANT TO THE TRIGGERING EVENT FOR LIMITATIONS PURPOSES, AND, IN ANY EVENT, THE LULLING DOCTRINE DOES NOT APPLY WHEN PLAINTIFFS HAVE “AMPLE TIME TO FILE SUIT WITHIN THE STATUTORY PERIOD.” Defendants’ motion asserts that Plaintiffs were on inquiry notice of their claims, and suffered actual damages, when they paid a minimum of $4,000 in October, 2002, to file a motion for reconsideration for the sole purpose of addressing the English translation issue. The Board of Patent Appeals and Interferences denied that motion for reconsideration in March, 2003, more than three years before the effective filing date. In a classic attempt to hide the ball, Plaintiffs spend pages of their opposition arguing that they were “lulled” into believing they had not suffered damages because Defendants expressed opinions that the Board and Federal Circuit would rule that no English translation was required. All of the lulling arguments, however, address the issue of whether Plaintiffs would eventually prevail in the interference proceeding. By March, 2003, Plaintiffs knew they had spent $4,000 addressing the English translation issue before the Board, and that the Board had ruled against them on that issue. That is enough to trigger the statute of limitations. Plaintiffs do not, and cannot, assert that Defendants lulled them into believing they had not spent a minimum of $4,000 on the motion for reconsideration, or that Plaintiffs had lulled them into believing that the Board had granted the motion for reconsideration. Plaintiffs’ lulling arguments are not relevant. Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 7 of 17 9Opposition at 21-22. 10The Federal Circuit ruled against Seed on May 3, 2004. That is obviously the latest limitations date that Plaintiffs could reasonably argue, and to do that they must ignore the attorneys’ fees they paid in October, 2002, and the Board’s denial of the motion for reconsideration in March, 2003. However, Plaintiffs frivolously argue that the earliest triggering date was when the Federal Circuit denied petitions for rehearing, on June 10, 2004, because they did not negotiate tolling agreements with Defendants Kratz Firm, Armstrong, Kong, and Kenehan until May 10, 2007, more than three years after the Federal Circuit ruled against Seed. Complaint, paragraph 32. - 8 - Regardless of their relevance, Plaintiffs’ lulling arguments suffer from a fatal defect: A defendant is estopped from asserting the statute of limitations as a bar to plaintiff’s action if he has done anything that would tend to lull the plaintiff into inaction and thereby permit the statutory limitation to run against him. But the effect of such estoppel is not to stop the running of the statute or to create a new date for its commencement. If ample time to file suit within the statutory period exists after the circumstances inducing delay have ceased, there is no estoppel against pleading the bar of the statute. Property 10-F, Inc. v. Pack & Process, Inc., 265 A.2d 290, 291 (D.C. 1970). Plaintiffs failed to cite this controlling authority to this Court. Here, Plaintiffs’ Opposition concedes that Plaintiffs were on inquiry notice of their alleged injury from the failure to file an English translation by June 10, 2004, when the Federal Circuit denied their petitions for rehearing, or by October 26, 2004, when the Supreme Court denied their petition for certiorari.9 They did not negotiate tolling agreements with Defendants until May 3, 2007 and May 10, 2007,10 more than two and a half years after the latest date when Defendants’ alleged lulling ended in the face of final judgments against Plaintiffs. Two and a half years was more than “ample time to file suit within the statutory period.” Property 10-F, Inc., 265 A.2d at 291. Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 8 of 17 11Opposition at 34-42. - 9 - III. THE D.C. CIRCUIT CORRECTLY READ R.D.H. COMMUNICATIONS, LTD. TO HOLD THAT THE CONTINUOUS REPRESENTATION RULE DOES NOT APPLY TO SUBSEQUENT APPEALS. In their initial memorandum in support of this motion, Defendants argued that in Bradley v. National Association of Securities Dealers Dispute Resolution, Inc., 369 U.S. App. D.C. 79, 433 F.3d 846, 850 (D.C. Cir. 2005), the D.C. Circuit held that the continuous representation rule did not apply to subsequent appeals. Defendants quoted the D.C. Circuit’s opinion in Bradley: “The court in [R.D.H. Communications, Ltd. v. Winston, 700 A.2d 766, 770-71 (D.C. 1997)] also set an outer bound on the duration of the ‘specific dispute’-it does not include appeals.” Bradley, 433 F.3d at 851 (other citations omitted). Plaintiffs argue that the D.C. Circuit does not know how to read, and that it misinterpreted the D.C. Court of Appeals opinion in R.D.H. Communications, Ltd. v. Winston.11 Instead, it appears that Plaintiffs willfully failed to alert this Court to a subtlety in the R.D.H. Communications opinion that the D.C. Circuit fully understood. In its R.D.H. Communications opinion, the D.C. Court of Appeals noted that the FCC dismissed R.D.H.’s radio station application on January 28, 1991, because the application failed to include a financial certification page. The opinion said that on February 19, 1991, attorney Winston sent his clients a copy of a petition for reconsideration he had filed with the FCC. The opinion went on: “The FCC denied the petition for reconsideration and the United States Court of Appeals for the District of Columbia Circuit affirmed, on a motion for summary affirmance, the FCC’s decision.” Winston wrote a letter on March 15, 1994, informing the client that the D.C. Circuit’s opinion was “the end of the road on this case.” On August 17, 1995, R.D.H. sued Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 9 of 17 - 10 - attorney Winston for failing to include the financial certification page in the FCC application. 700 A.2d at 767. The Superior Court granted defendant Winston’s motion for summary judgment on limitations grounds, holding that Plaintiffs were on notice of Winston’s alleged malpractice when they learned that the FCC first denied the application in January, 1991. The Court of Appeals reversed, holding that the continuous representation rule tolled the statute of limitations “until the attorney ceases to represent the client in the specific matter at hand.” 700 A.2d at 768 (emphasis added). If the Court of Appeals had intended the continuous representation rule to apply not just to the FCC proceedings, but also to attorney Winston’s representation of R.D.H. in the appeal to the D.C. Circuit, the relief granted would have been simple-the Court of Appeals would have reversed, with instructions to let R.D.H.’s claims proceed. After all, R.D.H. sued in August, 1995, well within three years if March, 1994 was the triggering date for limitations. Instead, the Court of Appeals said something entirely different: “Here, when the representation by Winston and his firm terminated is a question of fact that should be answered upon remand to the trial court.” 700 A.2d at 768. The need for remand is apparent upon reading a document that Plaintiffs cited in their Opposition-the D.C. Circuit’s summary affirmance of the FCC’s denial of R.D.H.’s application, R.D.H. Communications v. FCC, 1994 WL 88230, 1994 U.S. App. LEXIS 13812 (D.C. Cir. March 8, 1994) (unpublished). In that summary affirmance, the D.C. Circuit wrote that the motion for summary affirmance was granted “substantially for the reasons stated by the Federal Communications Commission in its orders adopted December 18, 1990, July 19, 1991, August Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 10 of 17 12Opposition at 39 & n. 94. - 11 - 18, 1992, and August 20, 1993.” Id., 1994 U.S. App. LEXIS at *1 (emphasis added). Obviously, proceedings before the FCC continued long after the FCC’s initial decision in January, 1991. R.D.H. sued on August 17, 1995, indicating that its counsel probably believed that the August 18, 1992 FCC order was of significance to the limitations analysis. There would have been no need for a remand or factual determinations about when attorney Winston’s representation “in the specific matter at hand” terminated if the continuous representation rule extended beyond the proceedings before the FCC. In footnote 94 of their Opposition, Plaintiffs argued just the opposite, writing: “Since the D.C. Circuit did not issue an opinion until March 8, 1994, a timely post-appeal malpractice claim would only be possible if the court concluded that the statute of limitations was tolled due to Winston’s continuous representation of R.D.H. on appeal. See RDH Communications Ltd. v. Fed. Communications Comm’n, 1994 WL 88230 at *1 (D.C. Cir. March 8, 1994).”12 If Plaintiffs’ counsel read the summary affirmance opinion they cited, it is difficult to interpret their argument as anything but a willful attempt to mislead this Court. The D.C. Circuit got it precisely right-the D.C. Court of Appeals opinion in R.D.H. Communications limited the continuous representation rule to the proceedings where the alleged malpractice occurred, and not to any subsequent appeals. Bradley, 433 F.3d at 851. Accordingly, the continuous representation rule does not save Plaintiffs’ time-barred claims based on the failure to file an English translation of the PCT Application. Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 11 of 17 - 12 - IV. PLAINTIFFS HAVE FAILED TO ALLEGE FACTS SUFFICIENT TO SUPPORT PROXIMATE CAUSE FOR DAMAGES ON THEIR CLAIMS OF FAILURE TO SETTLE BASED ON NEGLIGENT ADVICE. Plaintiffs’ Opposition still fails to allege facts sufficient to show that Defendants’ allegedly negligent advice that Seed would have an opportunity to add or amend claims before the patent examiner proximately caused Plaintiffs’ to reject two settlement offers. Seeking to obscure this shortcoming, Plaintiffs assert that Defendants cite no authority for their argument that, to plead proximate cause in this case, Plaintiffs must plead that they believed that they had any new or amended claims that were worth more than the value of the settlement offers. It is true that this is a rare case. Defendants have found few cases in which clients sued their attorneys claiming that negligent advice caused them to reject a settlement offer. Defendants’ counsel have found no case discussing the standards for pleading causation in such a case. This does not mean, however, that we are without guidance. Black letter law in the District of Columbia sets out clear requirements for pleading and proving proximate cause. Plaintiffs’ Complaint falls far short of these standards. Plaintiffs must plead facts sufficient to show that Defendants’ alleged negligence “resulted in and was the proximate cause of loss to the client.” Niosi v. Aiello, 69 A.2d 57, 60 (D.C. 1949)(emphasis added). In this case, then, Plaintiffs must plead facts sufficient to show that Defendants’ allegedly negligent advice was the proximate cause of their decision to reject the two settlement offers. The D.C. Courts define proximate cause as, “‘that cause which, in natural and continual sequence, unbroken by any efficient intervening cause, produces the injury and without which the result would not have occurred.’” Butts v. United States, 822 A.2d 407, 417 (D.C. 2003)(emphasis added) quoting Wagshal v. District of Columbia, 216 A.2d 172, 175 Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 12 of 17 - 13 - (D.C. 1966); Dunn v. Marsh, 129 U.S. App. D.C. 245, 393 F.2d 354, 357 (D.C. Cir. 1968); St. Paul Fire & Marine Ins. Co. v. James G. Davis Constr. Corp., 350 A.2d 751, 752 (D.C. 1976). In an attorney malpractice case, Judge Oberdorfer explained that in order to satisfy the causation element of their claim, plaintiffs: need only show that an attorney’s negligence was a “but for cause” of the alleged harm. This means that if the harm would have occurred regardless of the attorney’s advice, the attorney’s negligence is not a “proximate cause,” or a connection between events legally sufficient to support liability. Darby v. Medhin, 1991 U.S. Dist. Lexis 752 at *6-7 (D.D.C. 1991)(unpublished). The Courts have recognized that proximate cause includes “two components: ‘cause-in- fact’ and a ‘policy element’ which limits a defendant’s liability when the chain of events leading to the plaintiff’s injury is unforeseeable or ‘highly extraordinary’ in retrospect.” Majeska v. District of Columbia, 812 A.2d 948, 950 (D.C. 2002) quoting District of Columbia v. Carlson, 793 A.2d 1285, 1288 (D.C. 2002); Butts, 822 A.2d at 417. A defendant’s negligence is a “cause- in-fact” of an injury if it “played a substantial part in bringing about the injury or damages.” District of Columbia v. Freeman, 477 A.2d 713, 715 (D.C. 1984); Butts, 822 A.2d at 417. See also, Standardized Civil Jury Instructions for the District of Columbia, § 5.12 (2007) (“An injury or damage is proximately caused by an act, or failure to act, whenever it appears from a preponderance of the evidence that the act or failure to act played a substantial part in bringing about the injury or damage. Moreover, it must be shown that the injury or damage was either a direct result or a reasonably probable consequence of the act or failure to act.”) A careful review of the Complaint in this case, and even of Plaintiffs’ Opposition, reveals that Plaintiffs have failed to plead facts sufficient to establish proximate cause in this case. First, although Plaintiffs claim that they relied upon Defendants’ “erroneous legal advice” in deciding Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 13 of 17 - 14 - to reject the two settlement offers, they never allege that they would have accepted the settlement offers if Defendants had not negligently advised them that they would have an opportunity to raise new or amended claims before the patent examiner. Absent an allegation that “but for” or “without” the attorneys’ advice, Plaintiffs would have accepted the settlement offers and suffered no harm, Plaintiffs’ Complaint fails to establish proximate cause. Butts, 822 A.2d at 417; Dunn, 393 F.2d at 357; Darby, 1991 U.S. Dist. Lexis 752 at *6-7. The Westerman Defendants do not believe that Plaintiffs can make such an allegation in good faith. The facts will show that the Complaint completely mischaracterized Stevens’ settlement offers, which sought cross-licenses not just for the patent rights at issue in the interference, but for Plaintiffs’ entire patent portfolio related to correction tape dispensers. Plaintiffs likely turned down the settlement offers because Stevens’ potential patent at issue in the interference were not as valuable as Plaintiffs’ other patent rights. Because Plaintiffs would have rejected the settlements regardless of the Westerman Defendants’ advice, that advice cannot be a proximate cause of their harm. Darby, 1991 U.S. Dist. Lexis at 752 at *6-7. Similarly, the Complaint does not allege any facts establishing that Defendants’ advice “played a substantial part” in their decision to reject the settlement offers. The Complaint alleges that the Westerman firm “incorrectly advised Seed . . . that even if Seed were to lose the pending Federal Circuit appeal, the patent application would thereafter ‘be returned to the Examiner’ and Seed would be permitted to ‘add or amend claims.’” Complaint, paragraph 25. It is not enough if this advice had some minuscule, fleeting affect on Plaintiffs’ considerations. Defendants’ advice could only have played a “substantial part” in Plaintiffs’ decision to reject the two settlement offers if 1) Plaintiffs actually believed that they had new or amended claims to bring Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 14 of 17 - 15 - before the patent examiner and 2) Plaintiffs believed that those new or amended claims were more valuable than the settlement offers. The Complaint in this case includes no such allegations - nor does it include any other factual allegations which, if proven, would establish that the Defendants’ advice played a substantial part in their decision to reject the settlement offers. Accordingly, Plaintiffs have failed to plead that Defendants’ advice was the cause in fact of their injury. Finally, Plaintiffs are wrong in claiming that their Complaint satisfies the requirements of notice pleading. Vague and general allegations of malpractice “do not meet the Rule 12(b)(6) standard for pleading sufficient facts to state a claim of legal malpractice on which relief can be granted.” Mount v. Baron, 154 F. Supp.2d 3, 9 (D.D.C. 2001). In Mount, the plaintiffs alleged generally that the defendant attorneys were negligent in dropping certain defendants, failing to add others, and in dropping various counts from the Complaint. They did not include any allegations as to how the addition of the defendants and claims would have resulted in a different verdict. The United States District Court granted defendants’ motion to dismiss the complaint, holding that: The plaintiffs have pled no facts that, if proven true, would demonstrate the causal connection between the jury’s verdict and the failure to keep or re-add defendants and claims at the time of the filing of the second amended complaint . . . In other words, the plaintiffs have failed to allege any facts showing that but for the defendants’ negligence, there would have been a different verdict. 154 F. Supp.2d at 9-10. See also, Bigelow v. Knight, 737 F. Supp. 669, 671 (D.D.C. 1990)(dismissing malpractice complaint that alleged only “vague and general failures” of the attorney to interview witnesses without alleging how the witnesses would have supported the defense.) Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 15 of 17 - 16 - Here, as in Mount and Bigelow, Plaintiffs have alleged that the Westerman Defendants acted negligently. What they have failed to do is to “specif[y] the causal connection” between this alleged negligence and their decision to reject the settlement offers. Mount, 154 F. Supp.2d at 9. The Complaint includes no allegations as to what new or amended claims Plaintiffs hoped to raise before the patent examiner or how valuable Plaintiffs believed those claims to be. It includes no factual allegations as to which settlement offer Plaintiffs would have accepted but for Defendants’ allegedly negligent advice. Simply bandying around the words “proximate cause” does not provide Defendants with “fair notice of the nature of the plaintiff’s claim and the grounds on which it rests.” Mount, 154 F. Supp.2d at 9; Fed R. Civ. P. 8(a)(2). CONCLUSION For the foregoing reasons, Plaintiffs’ Complaint should be dismissed in its entirety. POSITION ON ORAL ARGUMENT Defendants believe that this motion is a relatively simple application of black letter D.C. law to undisputed facts, and that oral argument is therefore unnecessary. However, if the Court has any questions about Defendants’ arguments, Defendants request the opportunity to address those questions at oral argument. Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 16 of 17 - 17 - Respectfully submitted, Mark London Christopher B. Mead London & Mead 1225 19th Street, N.W., Suite 320 Washington, D.C. 20036 (202) 331-3334 Counsel for Defendants William F. Westerman; Westerman, Hattori, Daniels & Adrian, LLP; John Kong; and Ed Kenehan CERTIFICATE OF SERVICE I HEREBY CERTIFY that I caused a true copy of the foregoing Reply in Support of Westerman Defendants’ Motion to Dismiss, or, in the Alternative, for Summary Judgment, on Statute of Limitations and Causation Grounds to be served on all parties by electronic filing and to be served by email on April 25, 2008 to: John H. Harman chhlaw587@aol.com Coggins, Harman & Hewitt 8905 Fairview Road, Suite 600 Silver Spring, MD 20910 personal representative of the Estate of James Armstrong, III _____________________________ Christopher B. Mead Case 1:08-cv-00355-RMU Document 23 Filed 04/25/2008 Page 17 of 17 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 1 of 7 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 2 of 7 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 3 of 7 Exhibit G to Second Declaration of William Westerman Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 4 of 7 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 5 of 7 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 6 of 7 Case 1:08-cv-00355-RMU Document 23-2 Filed 04/25/2008 Page 7 of 7 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 1 of 6 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 2 of 6 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 3 of 6 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 4 of 6 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 5 of 6 Case 1:08-cv-00355-RMU Document 23-3 Filed 04/25/2008 Page 6 of 6