The opinion of the court was delivered by: Ricardo M. Urbina United States District Judge
DENYING WITHOUT PREJUDICE THE WESTERMAN DEFENDANTS'MOTION FOR SUMMARY JUDGMENT;DENYING WITHOUT PREJUDICE THE KRATZ DEFENDANTS'MOTION FOR SUMMARY JUDGMENT;GRANTING THE PLAINTIFFS'REQUEST FOR DISCOVERY
This matter is before the court on the defendants' respective motions for summary judgment, as well as the plaintiffs' request for discovery. The plaintiffs, Seed Company Ltd. and Shigeru Tamai, (collectively, "Seed"), bring claims of legal malpractice against the two law firms and individual lawyers who represented them in a prior patent dispute. The plaintiffs assert that the defendants acted negligently when they allegedly (1) failed to file an English translation of the plaintiffs' Japanese patent application with a particular motion in their patent litigation, and (2) provided erroneous legal advice that led the plaintiffs to reject two settlement offers related to that same patent litigation.
The defendants now move for summary judgment.*fn1 The plaintiffs, in response, ask that the court allow a period of discovery before ruling on the defendants' motions for summary judgment. Because the court determines that discovery should proceed prior to ruling on the defendants' motions, the court grants the plaintiff's request and denies without prejudice the defendants' respective motions.
On July 31, 1991, Seed filed a patent application ("JP 371") with Japan's patent office authority. Am. Compl. ¶ 13. On July 24, 1992, Seed filed an international patent application under the Patent Cooperation Treaty ("PCT") in Japan. Id. ¶ 14. The subject matter of both of these patent documents was a correction tape dispenser created by one of the plaintiffs, Shigeru Tamai. Id. ¶ 15.
In March 1993, Seed retained the law firm of Kratz, Quintos, & Hanson, LLP ("the Kratz firm") to file a patent application for Tamai's correction tape dispenser in the United States. Id. ¶ 16. On March 29, 1993, the Kratz firm filed an initial U.S. patent application ("183 application") on behalf of Seed. Id. ¶ 17. The following year, on February 15, 1994, the Kratz firm filed an additional patent application ("839 application"), which was a partial continuation of the 183 application. Id. ¶ 18.
Around the same time, on February 10, 1993, an individual named Christopher Stevens ("Stevens") filed a patent application in the United Kingdom for a correction tape dispenser. Id. ¶ 19. While Seed's U.S. patent application was pending, Stevens had filed a patent application for the correction tape dispenser in the United States. Id. ¶ 21. Approximately two years later, on February 28, 1995, the United States Patent and Trademark Office ("USPTO") issued Stevens a patent for his design. Id. ¶ 19.
Detecting that Seed's pending 839 application and Stevens' U.S. patent involved potentially similar subject matter, the USPTO declared an "interference" to determine the relative priority of the two.*fn2 Id. ¶ 20. Stevens petitioned the U.S. Board of Patent Appeals and Interferences ("the Board") to have his U.S. patent application backdated to the date that he filed his United Kingdom patent application. Id. ¶ 21. The Board granted his request, allowing Stevens' U.S. patent application to be considered filed as of February 10, 1993. Id.
The Kratz firm filed a similar motion with the Board requesting that Seed receive the benefit of the PCT and JP 371 applications filed in Japan and dated July 24, 1992 and July 31, 1991, respectively. Id. ¶ 22. With the motion, the Kratz firm included an English language translation of the JP 371 application, but did not include an English language translation of the PCT application. Id.
In June 2002, the Board granted Seed's request to receive the benefit of the July 31, 1991 date associated with the JP 371 application ("Board's June 2002 decision"). Id. ¶ 23. The Board did not, however, afford Seed the benefit of the July 24, 1992 date associated with its PCT application because Seed failed to include an English language translation of its Japanese PCT application with its motion, as required by 37 C.F.R. § 637(f) and § 1.647. Id. Nevertheless, because Seed's JP 371 application, dated July 31, 1991, was filed in Japan prior to Stevens' United Kingdom application, dated February 10, 1993, the Board assigned priority to Seed with respect to the correction tape dispenser patent in the United States. Id.
In July 2002, the Kratz firm filed a motion for reconsideration with the Board, arguing that Seed should receive the benefit of the PCT application date notwithstanding the lack of an English translation filing. Westerman Defs.' Mot. for Summ. J. ("Westerman Def.'s Mot.") at 6-7. The Kratz firm argued that a translation of the PCT application was not necessary because one had already been included with the 183 application. Id. The Board denied this motion for reconsideration, reiterating its earlier ruling that a separate English translation was required for Seed to receive the benefit of its PCT application date. Id. at 8. Seed nevertheless retained the benefit of the date associated with the JP 371 application date and hence priority over Stevens' patent. Id.
In May 2003, Stevens filed an appeal with the Federal Circuit regarding the Board's June 2002 decision that had awarded priority to Seed for the correction tape dispenser patent. Am. Compl. ¶ 24. Although the Kratz firm continued to represent Seed with respect to this appeal, id., around October 1, 2003, some of the attorneys handling Seed's case -- specifically William Westerman, John Kong, and Ed Kenehan -- left the Kratz firm to establish their own law firm under the name Westerman, Hattori, Daniels and Adrian, LLP ("the Westerman firm"), id. ¶ 27. The Westerman firm took over Seed's representation regarding the correction tape dispenser patent in the United States. Id.
In January 2004, while Stevens' appeal was pending in the Federal Circuit, Stevens submitted a settlement offer to Seed that would have granted each party a royalty-free, non- exclusive license that included the right to sublicense for the other party's patent rights. Id. ¶ 28. According to the plaintiffs, the Westerman firm subsequently advised Seed that even if the Federal Circuit reversed the Board's decision granting Seed priority, Seed's patent application would "be returned to the [patent e]xaminer," at which point Seed would be permitted to "add or ...