L'Oréal USA patent quota suit dismissed by a federal judge

By Deanna Utroske contact

- Last updated on GMT

L'Oréal USA patent quota suit dismissed by a federal judge
When the head of patents for the beauty company spoke up with concerns about how L'Oréal manages it patent applications, he lost his job and took his former employer to court.

The suit filed back in April is being called “a retaliatory discharge suit,” ​by the New Jersey Law Journal.

Plaintiff Steven Trzaska, formerly head of patents and business development at L'Oréal, explained in his suit that he was fired in late December “after complaining to management that he was at risk of violating rules against bringing frivolous proceedings and making false statements to a tribunal under the Rules of Professional Conduct and the rules of the U.S. Patent and Trademark Office,” ​as the New Jersey Law Journal reports it. 

According to his lawyer, Trzaska earned close to $400,000 annually at L'Oréal and until being let go was poised to keep working for an additional 15 years.

Allegations

“The plaintiff claimed L'Oreal was making its patent lawyers violate the Rules of Professional conduct by submitting frivolous or deficient applications to meet the company's quotas,” ​explains Charles Toutant, in an item about the dismissal in the New Jersey Law Journal.

This was supposedly done for two main reasons: to mislead consumers and impress stakeholders, according to the suit. Personal care and beauty products were ostensibly labeled as “patent pending” in an effort to lead consumers to believe that the company is on the cutting edge.   

Similarly, Trzaska indicated that “the quotas are also intended to improve the company's reputation and to make shareholders and financial analysts think it is innovative.”

Rules of professional conduct

The case was a Conscientious Employee Protection Act claim premised upon the Rules of Professional Conduct, standards set by the American Bar Association as the baseline of ethics and professional responsibility for lawyers in the States.

Trzaska claimed that policies in place at L'Oréal USA effectively required employees to disregard those standards. His suit noted that the company “set quotas of 40 patent applications in 2014 for its U.S. research division in Clark and a global quota of 500 patent applications for that year,”​ according to the Law Journal item.

He claimed that having to file this number of applications meant submitting items for review that were knowingly non-patentable. Though as that publication points out, “the plaintiff never claimed that he was asked to submit a deficient application in his decade working for L'Oreal, U.S.”

Resolution

Late last week District Judge Susan Wigenton explained that Trzaska v. L'Oreal "evinces nothing more than his disagreement with his employer over the propriety of a quota for patent applications."

She dismissed the suit and clarified that RPCs are not a suitable basis for this sort of claim. The rules act as code of conduct for legal professionals like Trzaska but do not obligate his employer to conduct business in any particular way.

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