Leading Questions: Finnegan’s Frank DeCosta

Lawyers are great at asking questions, but how are they at answering them? Bloomberg Law is talking with lawyers and other legal industry players at the top of their fields to find out what makes them tick, what challenges they face, and how they do what they do.

Frank DeCosta has seen a dramatic increase in patent litigation, driven in part by “economic insecurity” brought on by the pandemic.

“Companies also use litigation to leverage IP assets to protect market share, which has even greater bottom line significance in the economic environment presented by Covid-19,” he says.

DeCosta leads the litigation practice at Finnegan, Henderson, Farabow, Garrett & Dunner, an international IP firm. More than 280 lawyers at Finnegan have worked on litigation matters involving copyrights, patents, trademarks, and trade secrets.

DeCosta, who works in the firm’s Washington, D.C. office, says lawyers have adjusted to conducting depositions and hearings with judges remotely during the pandemic. Jury trials, however, have essentially ground to a halt.

“Going forward, while there is a significant backlog, some clients may consider whether they will decide to forgo jury trials and elect to try their cases to the bench,” he says.

Bloomberg Law spoke to DeCosta about how litigation funding is driving patent disputes, the challenges of hiring attorneys for a specialized, niche practice, and the time a group of U.S. Marshals showed up to enforce one of his client’s IP rights.

This conversation has been edited for clarity and length.

Bloomberg Law: What legal question keeps you up at night?

Frank DeCosta: Is X (insert description of invention here) patentable? At times it has been difficult to advise clients with reasonable certainty regarding what is eligible subject matter given differing and sometimes conflicting guidance coming from the various courts and the USPTO.

I have been practicing in this area for many years, and I remember the period between the State Street and Alice decisions, where to answer the question, “Is this patentable?” did not require dwelling on the question of eligible subject matter under Section 101. The analysis instead focused more on novelty and nonobviousness under Sections 102 and 103.

Now, the confusion in the courts’ decisions seems to be rooted in conflating the analysis underlying Sections 101, 102, and 103: confusing the question regarding what’s eligible for patenting with questions seeking to determine whether the challenged claims are distinguishable from the prior art.

BL: Patent litigation has seen a dramatic increase during the course of the pandemic. Why is that?

FD: In 2020, we saw a return of district court patent filings to the peaks of 2017. Over the years, patent litigation has been cyclical. It is not unusual during times of economic uncertainty for patent filings to increase.

There are many drivers behind a decision to initiate litigation. Companies may seek to monetize patent portfolios to justify previous investments or generate a revenue stream to backfill budget cuts.

Companies also use litigation to leverage IP assets to protect market share, which has even greater bottom-line significance in the economic environment presented by Covid-19.

There has been a significant increase in the interest of litigation funding organizations in patent disputes. This business model has added fuel to the established, pre-pandemic docket of NPE cases. Not only has there been an expansion of the litigation funding ecosystem, many are reporting that they are overwhelmed by the number of deals that are being submitted for vetting.

BL: As a litigation leader at the firm, how have you helped your colleagues navigate the transition to virtual trials and the challenges around trial scheduling?

FD: We had a running start pre-Covid because remote engagement was not a completely new concept for us. We had on occasion conducted remote depositions. Many courts were already in the habit of conducting telephonic hearings. Trials at the PTAB routinely had judges participating by video.

If there is anything positive coming out of the pandemic, we all now have a robust and proven toolkit that allows for remote engagement for virtually all phases of litigation. We are using remote litigation engagement to provide opportunities for junior lawyers to participate in deposition, hearings, and meetings that may not have been as readily available given travel costs pre-pandemic.

The wildcard has been jury trials. Protocols in place have limited bandwidth in the courthouse. In some cases, protocols are limiting scheduling to one jury trial at a time per courthouse.

Going forward, while there is a significant backlog, some clients may consider whether they will decide to forgo jury trials and elect to try their cases to the bench.

Frank DeCosta

Photo courtesy of Finnegan

BL: What specific strategies are you using to attract and retain clients? What’s the biggest challenge?

FD: To attract and retain clients, we endeavor to fill their need for a trusted adviser. In serving that role, we keep up with clients’ businesses. We look around corners to anticipate issues before they present problems for clients. One of the best ways of achieving that goal is spending time with clients at their facilities.

Now that we are relegated to engaging remotely, most every client interaction is now scheduled. We have lost opportunities for spontaneous touches with clients that strengthen relationships.

I miss being on our clients’ campuses. I miss having a client drop in on a meeting you are having with one of their colleagues to raise a legal issue they are facing, or having a client see you on campus and stop you for a brief conversation that reveals legal challenges they are facing. I miss lunches with clients in their cafeteria. These were all opportunities for embedding with clients that provided valuable insight to help advise them.

BL: What’s your best war story from your legal career?

FD: The best example comes from a series of litigations that started in Las Vegas where we escorted a team of 20 U.S. Marshals through the showroom floor of the Consumer Electronics Show to enforce our client’s IP rights. This initiated cases in several U.S. district courts with discovery throughout the U.S., Asia, and Europe that resulted in judgments and jury verdicts for over $100 million for our client. Along the way, an executive of one of the defendants received a sentence in federal prison, and another defendant used pieces of fruit to obscure information in scans of documents that the court ordered produced, which resulted in sanctions.

BL: Does the firm have specific diversity targets, is the firm meeting those targets and what does it still need to do to improve diversity?

FD: We want our teams to reflect the diversity of our clients, the judges that preside over our case, and the jurors we seek to persuade at trial.

To that end, we target the broadest talent pool available. Given the nature of our practice, the depth of the talent pool is a real challenge.

There are several layers of filters that inherently limit the pool. For our patent practice, candidates have undergraduate and, in many cases, advanced degrees in STEM-related fields. So, you start with the pool of graduates of STEM-related university programs. Then you take only the subset of those graduates that choose to go to law school instead of pursuing the many other career opportunities for STEM graduates. And from that group of law students you further separate out the law students with STEM backgrounds that have no interest in IP law. The net pool is relatively small. And when you look within that already small pool to find candidates from underrepresented groups, the population of potential recruits is quite small.

The point of this exercise is not to conclude that the candidates are nonexistent or unicorns too hard to seek out, but this demonstrates that a targeted effort is required to match candidates with the available opportunities. And it illustrates how damaging and nonsensical it is to add a further filter of discriminatory hiring practices to deny access to a valuable talent pool.

To respond to the diversity challenge, we are focused on being even more intentional with our efforts. Finnegan has a number of very targeted internal and external activities to recruit, develop, retain, and advance the best lawyers available. Those activities include a diversity scholarship program, a diverse attorney sponsorship program, a L.E.A.P. Program, a Peer/Partner Adviser program, Finnegan FORWARD women’s initiative, participation in the Leadership Council on Legal Diversity (LCLD), participating in the Hispanic National Bar Association IP Law Institute, Mansfield Rule certification, and working with pipeline organizations like the National Society of Black Engineers.

BL: I’m a new associate, fresh out of law school, what should I do to stand out and advance my career in the best way possible?

FD: Always make sure that you are working with the goal of providing the most value to the clients we serve. While big picture strategic judgment comes with experience, young lawyers right out of law school have the responsibility and ability to know the facts and law related to their portion of cases better than anyone else. You can stand out by being the go-to person on an issue of law or the facts associated with a segment of the case. Be inquisitive. Know how your work fits within the larger framework of the projects you work on. Speak up when you spot issues. Never be afraid to ask for help.

And instead of letting the pursuit of promotions drive your legal career, focus on building a legal practice that you enjoy. You will practice law every day of your career, but in relatively flat organizations like a law firm even the most successful lawyer will only be promoted a couple of times. So, develop a practice that will give you satisfaction and enjoyment every day, not just on the one day when you are promoted to partner.