Litigating for the Greater Good: Knobbe Martens Lawyer Scores Big Wins

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1 Of Counsel Interview Vol. 34 No. 3 March 2015 Litigating for the Greater Good: Knobbe Martens Lawyer Scores Big Wins Recently patent litigator Joseph Re was handling a major case for a prominent medical device manufacturer. Gerard von Hoffmann, Re s friend and partner at Irvine, CA-based Knobbe Martens Olson & Bear, one of the nation s largest intellectual property firms, got a call from one of the company s board members. I knew a number of the board members and they wanted to know about Joe a lot was at stake in this case, von Hoffmann recalls. The board member told him this about Re: I don t know if he s right or not, but he sure does have a lot of confidence. Well, Joe was right and he won, von Hoffmann adds. Re tends to win a lot of victories, including a $467 million jury award in a patent infringement suit brought by his long-standing client, the bio-tech company Masimo Corp., against Philips Electronics North America Corp. It was the third-largest legal judgment in the United States in But Re is most proud that the victory means more hospitals will be able to offer patients Masimo s highly acclaimed pulse oximetery monitoring technology, which has improved health care while reducing the costs of care. Von Hoffmann takes responsibility for recruiting Re, or at least helping recruit the charismatic New York native in the mid-1980s, that is, once the other Knobbe Martens attorneys agreed that Re would be a good fit for the partnership. Joe can articulate his views with refreshing clarity and he certainly fills the room, von Hoffmann says. And when we were discussing whether to hire him or not, his qualifications were never in question. The discussion centered around whether his strong presence would affect the firm, because back then, there were under 20 of us and at least eight or 10 of him. We decided that we should hire him and we did, and we figured he would affect the firm and he did. Not only did Re fit into the culture of the Southern California-based firm, he soon became one of its leaders, helping hire attorneys to build its ranks from 21 lawyers when he came aboard to some 275 today. But mostly he s known for the dynamic (and often witty) personality, legal expertise, and trial experience he brings to the courtroom. Joe is in control of his environment completely, von Hoffmann says. He s also, to some extent, the class clown. The reason he gets away with that is because he delivers. He does his homework, he gets it right, and he wins. Recently, Of Counsel talked with Re about his upbringing, legal career, hiring experience, the Masimo litigation, and other topics. What follows is that excerpted interview. Of Counsel: What made you decide to become a lawyer, Joe? Joseph Re: First of all, my parents met in law school and were both lawyers. My father was a law professor at St. John s University, where he taught for 55 years. When I was growing up, he was with the government, adjudicating cases in Washington, DC. So I grew up in a very law-oriented house. I am

2 one of 12 children, from the same set of parents. I have seen trials since I was nine years old, and my father would bring home the work almost every day, asking for opinions from the gallery [laughter] about his cases. OC: You went to Rutgers University to get your engineering degree with the intent of going to law school. Did you think that intellectual property law would be the right course for you? JR: No doubt about it. My brothers and I were into construction. I m the youngest of five boys and my older brothers ran a construction company, which is still going on to this day. So I worked my way through school working construction, and civil engineering, of the technical [fields of study], seemed like the one I found the most interesting and that I could understand. And then, lo and behold, when I started law school, they created the Federal Circuit and all the patent cases were going to one appellate courthouse. Right from the beginning, my father said to me, You ve got to gun for a clerkship at that courthouse. OC: You clerked for Judge Markey. JR: Yes, Chief Judge Markey was the first judge of that court, and he knew my father well. He gave me one piece of advice. He said, I can t hire you because it will look unfair, unless you make editor of your law review. You ve got to become the editor of your law review. So I knew as a freshman that I had to become the editor, which I did and then the next day he called me up and said, I ve got a clerkship for you. OC: You clerked for him for a couple of years, and then where did you go? JR: I went to Knobbe and I ve been here ever since. They recruited me because some of the other law clerks were coming here, including Gerard von Hoffmann, who is still a partner here. So Gerard and I have known each other since Influencing the Rule of Patent Law OC: When you think of some of the early work you did, what one or two of the cases stand out to you and why? JR: As a young lawyer, I worked with Don Martens on a patent case for American Airlines. That jumps out because the Supreme Court of the United States granted certiorari for that case, on the right to trial by jury on the validity of patents. That case actually set up what became, the next year, the grant of certiorari in the Markman case [Markman v. Westview Instruments, Inc.], which was the Seventh Amendment right of trial by jury on claim construction on a patent case. That was a very significant case and I felt like we helped pave the way to further define the right of trial by jury in a patent case. I got to work closely with Don Martens for many years on that case; he was obviously one of my mentors. He has since retired but he was one of the founders and really was the first litigation lawyer in this firm. In another one that stands out, I helped get a case before the Supreme Court, and I participated in writing an amicus brief to get the Supreme Court interested in fixing another rule in patent law. OC: You mentioned writing the amicus brief and that you were the editor of the law review. Do you advise young attorneys about the importance of writing? And if so, are they receptive? JR: The answer is absolutely yes, and the receptivity varies [laughter]. I always try to remind the young lawyers that I started out exactly like them. In fact, sometimes they have a head start on me because they probably went to more prestigious schools. The kind of associates that our firm gets today are superior to any of those we used to see 30 years ago. These are top-of-the-class, top law school people who come to the firm today. 2 Of Counsel, March 2015

3 But the thing that separates the successful young lawyer from the unsuccessful one is that the successful one always branches out and does things professionally beyond the actual billable hour. So if two associates start out and they both bill nine hours a day, the person who succeeds is the one who volunteers to assist in the writing of articles, speeches, chapters, books, whatever. That person is showing much more of an interest and is working harder and really rounding out their writing skills. I think that s key. And not just writing, but speaking too. Usually good writers are good speakers. They go hand-in-hand a lot of the time, so I really encourage everybody to improve their writing skills. OC: How long did you help with recruiting? JR: I did that for 16 years. I became a partner in 1990 and the first question you get when you become a partner is: How would you like to help in the firm management? I said I d like to get involved in recruiting. The firm at that time had about 30 lawyers. And the partners were happy to have me help recruit. So I started working on recruiting with a few other lawyers and our job was to build the firm and diversify the lawyer population. When I got here the firm was very Midwest. All the founding partners and a lot of the senior lawyers came from flyover states, as far as I m concerned [chuckles]. They came from places like Illinois, Wisconsin, North Dakota, Minnesota, Ohio places I had never been. I was determined, along with some of the other lawyers, to really get people from throughout the country, other countries as well, and we went on a recruiting push throughout the 90s to visit all these campuses. I remember at one recruiting meeting in 1993 we discussed what campuses we should go to. I said, Let s start with Harvard. Everybody laughed and said, We can t get Harvard lawyers interested in patent law to come here. And I said, Why not? One of the senior partners, Louis Knobbe, said, Yeah, why not? We insulted his firm when we said no one would come here from Harvard. Well, we went to Harvard, and the first time we came back with two recruits, two new associates, both from Harvard, because, in the early 90s, firms weren t hiring but we were. That s what started the explosion of the firm and by the time I finished recruiting we had well over 200 lawyers, which means we must ve hired 300 to 400 to get to 200 and something. Now I ve got tremendous support in all my cases because many of these lawyers who are in their 40s or late 30s I helped hire. I know them well. OC: Of course in the early 90s, IP was just beginning to grow and so the need for IP attorneys was also beginning to grow. JR: Yes, in the early 90s, because firms like ours were hiring, the general practice firms noticed and thought that maybe this IP area is recession proof. So, throughout the 90s the general practice firms started building or expanding their IP groups. Consequently, many of the firms that were referring cases to us all of a sudden became our competitors. And, that s where we are today. But you re right: I come from an era when not a lot of lawyers wanted to do this work. My patent law class had four people in it. The Ivy League schools did not offer patent law classes in the 1980s. So the change has been remarkable. Watching the Growth OC: In terms of recruiting and maybe more broadly in terms of the management side of being a partner, what is really satisfying and then what is really challenging? JR: Well, the most satisfying thing is when I see someone who started at the firm and I look at them 10 years later and say, Wow, look at this person now. I like sports. I like scouting. I like to see talent. I really get a charge out of seeing somebody who s a little Of Counsel, Vol. 34, No. 3 3

4 rough around the edges but has great brainpower and has some charisma and I say this person is outgoing and has a great career ahead of him or her and doesn t even know it. And they doubt it when I tell them [that they have a lot of potential and a great career ahead of them] when they re 25. They say, Really? Really? But then I get to talk to them when they re 35 and 38 and 40 and I say, Do you remember that conversation we had? And they say, Yeah, I can t believe I said that to you. I know these people really, really well and nothing is more satisfying than watching the development of a young lawyer. OC: Thank you. Now about the other side. What keeps you up at night? What are the problem areas? JR: The problem areas are the lawyers who ve been told by their mothers that they are the greatest person ever, the people who go to law school for the wrong reasons, those who are interested in money and nothing else, those were not dedicated to the profession, those who think they can do it parttime. Those are the problem areas. They look at me sometimes and they think I m a madman by how much I work, but I tell them that they can t do this part-time. You have to stay current. Every day when you wake up you have to ask, what s new? What can I do today? How can I prove my clients cases? You have to be obsessed otherwise some lawyer will just take the case from you [laughter]. OC: To shift gears here a little bit, how much has your engineering degree helped you in your IP practice? JR: Tremendously. First of all, you need a science background to get admitted to the patent office. The first thing I did in law school was get admitted to the patent office because I want to make sure I would get a job. It was the early 80s and jobs weren t that great yet. So I got admitted to the patent office to show interest in the field. But in general I can really tell those who fear technology and those who don t. The problem is, many people who don t have technical backgrounds sometimes have this reluctance to really dig down and learn technology. You have to learn the technology. An engineering background gives you the aptitude. I m not concerned about whether someone has a degree in chemical engineering or electrical engineering or civil engineering or mechanical engineering. If you went through engineering school and you did well in law school, I ll take you. You re pretty smart. So in our firm 95 percent of our lawyers have technical backgrounds. That gives us the depth that many firms simply don t have. The Gold Standard OC: Great. So let s get to this big victory that was handed down recently in the case involving your client Masimo. What s important about that case? Why is it a headline maker? JR: It s probably a headline maker for the wrong reason. It s probably a headline maker because it s one of the largest verdicts in 2014 at $467 million. But it s really not about the money. OC: What should the headline be? JR: Well, the real goal of the litigation is to get the Masimo technology to serve as the gold standard, the default, because it s truly the best technology. It s life-saving, and it s an absolute shame that many hospitals do not adopt it at first. It s such a complicated story, and there will be books written about it, I promise you. For Masimo to break through the hospital market with this innovation was a story of unbelievable perseverance by Joe Kiani. OC: He s the CEO. JR: Yes, he founded the company back in 89 and he had this great technology. He just assumed that because it was so great and 4 Of Counsel, March 2015

5 life-saving and cost-saving that people would want it. But he discovered that many hospitals couldn t buy it. They were prohibited from buying it. That was a head-scratcher for him, and then he realized the hospitals were beholden to the large GPO s, group purchasing organizations, with contracts that force hospitals to buy all their goods from certain suppliers to keep the prices at certain levels. He said, This doesn t sound right to me. We have to change the laws. So he literally went to Congress and started knocking on the senators doors. And in mid-2002 on the front page of The New York Times was Joe s story. The Times ran a series of articles about this issue. All of a sudden the GPO s backed off and said we promise we won t do it anymore. And then Masimo and some of my other clients were able to sell directly to the hospitals, without penalizing the hospitals, so they could improve their technology. [Except that Phillips, the defendant in the case, was not offering the Masimo technology as the standard.] They were selling their imitation infringement as the default. So if hospitals didn t know Masimo by brand, they weren t getting it. They were getting the infringing module. So what we were trying to do with these cases is to get Philips to finally offer Masimo as the gold standard at least in proportion to Masimo s market share. What had been happening was that they were offering Masimo in small quantities and pushing their own infringement. That s why the damages were so high. OC: Obviously, you re competitive, you want to win, you want to help your client, but I m sensing that you knew there was a greater good at stake in this case. JR: Oh, definitely. I understand that it s often not just about passing around the money from one corporation to another. And, what s most important about this technology is that the health benefits have been enormous. It saves lives, eliminates premature blindness in babies, and reduces health care costs. It s really been remarkable. And it s now becoming the standard of care in all hospitals. So yes, this is about the greater good. Steven T. Taylor Copyright 2015 CCH Incorporated. All Rights Reserved. Reprinted from Of Counsel, March 2015, Volume 34, Number 3, pages with permission from Wolters Kluwer, New York, NY, ,

A Decade after Leaving BigLaw, Two Partners Continue to Lead a Thriving Boutique

Wolters Kluwer Of Counsel Distribution Center 7201 McKinney Circle Frederick, MD 21704 Of Counsel Interview A Decade after Leaving BigLaw, Two Partners Continue to Lead a Thriving Boutique Not many lawyers