Eakin Enters., Inc. v. Stratton Ballew, PLLC

• Decision Date: 24 March 2020
• Docket Number: No. 36316-3-III,36316-3-III
• Court: Washington Court of Appeals
• Parties: EAKIN ENTERPRISES, Inc., a Washington Corporation; JOHN W. EAKIN, a single person, Appellants, v. STRATTON BALLEW, PLLC, a Washington Professional Limited Liability Company; SVENDSEN LEGAL, LLC, a Washington Limited Liability Company; CHRIS E. SVENDSEN and "JANE DOE" SVENDSEN, husband and wife, and the marital community composed thereof; STRATTON LAW & MEDIATION, P.S., a Washington Professional Services Corporation; REX B. STRATTON and "JANE DOE" STRATTON, husband and wife and the marital community composed thereof; PATRICK H. BALLEW, a single person, Respondents.

EAKIN ENTERPRISES, Inc.,a Washington Corporation; JOHN W. EAKIN, a single person, Appellants, v. STRATTON BALLEW, PLLC, a Washington Professional Limited Liability Company;SVENDSEN LEGAL, LLC, a Washington Limited Liability Company; CHRIS E. SVENDSENand "JANE DOE" SVENDSEN, husband and wife, and the marital community composed thereof;STRATTON LAW & MEDIATION, P.S., a Washington Professional Services Corporation;REX B. STRATTON and "JANE DOE" STRATTON, husband and wife and the marital community composed thereof;PATRICK H. BALLEW, a single person, Respondents.

No. 36316-3-III

COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION THREE

March 24, 2020

UNPUBLISHED OPINION

FEARING, J. — On cross motions for summary judgment in this attorney malpractice suit, the client and attorney disputed whether the parties had entered an attorney-client relationship at the time of the attorney's purported failure to properly advise the client. The trial court ruled that the parties had not yet entered the attorney-client relationship, and the court thereby granted the attorney summary judgment dismissal of one of several claims of malpractice. We take the unusual step of reversing based on factual uncertainty. We remand for further proceedings on the basis that the parties failed to fully develop and present important facts needed to resolve the issue on summary judgment, assuming the issue should be resolved summarily. We also rule that the trial court properly certified, for immediate review by this court, the grant of the partial summary judgment dismissal in favor of the attorney.

FACTS

This case deals with alleged attorney malpractice stemming in part from an attorney's failure to warn an ostensible client against use and public display of an invention before the client's application for a patent. We borrow our facts from summary judgment declarations, deposition testimony of the parties, and a declaration of an expert witness.

In 2004, plaintiff John Eakin began developing a cattle footbath used to bathe dairy cows' hoofs before milking. The footbath system applies a concentration of formaldehyde into a basin through which cows walk, and the formaldehyde cleans and sterilizes the feet. The bath prevents or kills fungi and bacteria from settling in the tissue of hooves. Eakin modified the invention over the years. We refer to the various formulations of the invention as "first prototype," "second prototype," and "third prototype."

In 2005, John Eakin finished his first prototype. In November 2005, Eakin displayed the inaugural prototype at the annual Dairymen's Show in Boise. This prototype proved unsuccessful because undiluted formaldehyde splashed workers operating the footbath as the formaldehyde flowed from a storage tank into the basin. Formaldehyde emanates noxious and harmful fumes.

In early 2006, John Eakin fashioned his second prototype of the cattle footbath, the prototype that is the subject of this appeal. The second prototype included two improvements, a meter that regulated the amount of flow of the formaldehyde added to the basin of the footbath and a check valve that vented fumes into the air. In summer 2006, a dairy commercially operated the second prototype.

A principal question on appeal surrounds when John Eakin and defendant Chris Svendsen formed an attorney-client relationship such that Svendsen owed a duty of careto Eakin. John Eakin informed his friend, attorney Wes Gano, of his invention. Gano suggested that Eakin speak to patent attorney Chris Svendsen about procuring a patent.

On August 2, 2006, John Eakin telephoned Chris Svendsen of Stratton Ballew, PLLC. According to Chris Svendsen, Eakin said "he was working on a system for a 'better' [cattle] foot-bath system and that he would keep [Mr. Svendsen] posted on its development." Clerk's Papers (CP) at 488. Further, according to Svendsen, Eakin told Svendsen "to wait to hear back from him." CP at 488. In a deposition, John Eakin corroborated that he continued to work on the footbath invention at the time of his first call to Svendsen.

According to Chris Svendsen, he asked few questions of John Eakin during the initial phone call on August 2, 2006, because Svendsen needed to perform a client conflicts check. Svendsen avers that he provided no legal advice during the call. Svendsen references the August 2 phone call as a "'screening interview'" and refuses to label the phone conversation as an "'initial interview.'" CP at 488. Svendsen insists that he needed to limit the questions asked Eakin before completing the conflicts check.

We do not know if John Eakin and Chris Svendsen informed the court as to the full extent of the conversation on August 2. Nevertheless, during the August 2006 phone call, Chris Svendsen did not ask Eakin questions about the status of development of theinvention or whether Eakin had publicly displayed or allowed use of the invention as it then existed. According to Svendsen, questions of prior use or display should not be asked during this screening interview. Svendsen did not ask Eakin if he had any plans in the foreseeable future to publicly display or use the invention. Svendsen did not inform Eakin of any time periods or deadlines within which an application for the patent would need to be filed.

As a result of the phone call, Chris Svendsen completed a law firm form entitled "'Screening Interview'" used to perform a conflicts check. CP at 241, 560. The form includes a script containing questions for the attorney to ask the potential client. The form reads:

Therefore, in order to avoid a potential conflict of interest, we need to ask you a few questions. We can then conduct a quick internal conflict check and call you back, most likely before the end of business today.

CP at 395 (emphasis omitted). Under the script, the attorney asks the potential client his or her name, the general field to which his or her project relates, any employment, and any dispute over the invention. The form confirms that Svendsen asked Eakin these questions.

As part of his response to this lawsuit, Chris Svendsen contends that no attorney-client relationship began with John Eakin until late 2007. Nevertheless, in his deposition, Svendsen testified:

Q . . . What is a screening interview?

A Just a basic document that Stratton Ballew would circulate when a potential client was—a potential client was—needed to be screened for conflicts before work began for that client.

. . . .

Q And at the top of this document it's dated August 2nd, 2006?

A Yes, it is.

. . . .

Q And was the purpose of this screening interview for you to talk with Mr. Eakin about getting him a patent?

A It was to—to open that door to make sure it was okay for me to formally enter in a client relationship with Mr. Eakin.

Q So earlier this morning we were discussing this, you couldn't remember exactly which year this all started.

A Uh-huh.

Q So would it be fair to say that this process started in August of 2006?

A I think that would be fair, yes.

. . . .

Q Is this screening interview, Exhibit 9, is this something that would have been done in advance of Mr. Eakin coming in to meet with you?

A No, not per se. It would have just been in advance of—of the firm being able to do any work for John Eakin.

Q So do you believe you started the process of working on getting a patent in August of 2006?

A No, I think it was—it just opened the door so that we could—we could discuss in—in—for the purpose of—of obtaining a patent certainly.

. . . .

Q So when do you believe you were officially retained to obtain a patent on behalf of—or a patent for this cattle foot-bath system?

A Well, retainer, I—I seldom charge retainers. My—my relationships with my clients generally begin with the—with the understanding that they've contacted me and I'm going to be helping them in a—in a—in a certain project. What—the—as I recall it would have been in the fall of 2007 that there would have been a formal—more formal, Okay, we're going to file this and it's going to cost this amount. And we're going to—and we're going to go forward with it.

Q Let me ask it a different way. When do you believe the attorney-client relationship began for the effort to get a patent for the cattle foot-bath system?

A I—I would—I would say that that would have been in the mind of John Eakin and - and is a big part of that. And I'm—I'm sure he considered this in the fall here of 2006. That that—that relationship was—a formal relationship had started.

Q So at some point did you do a letter to Mr. Eakin setting forth the scope of your representation or what you'd been retained to do or?

A I believe so.

CP at 271-74 (emphasis added) (boldface omitted). Despite this answer, neither party submitted any formal representation agreement or letter as part of the summary judgment motion pleadings.

After the August 2006 phone call between John Eakin and Chris Svendsen, Svendsen and other members of the law firm, Stratton Ballew, conducted a conflict of interest search. Patent attorneys' conflict searches principally concern the nature of the invention rather than the names of parties. On August 10, 2006, Svendsen completed the investigation and found no disqualifying conflicts.

Someone also completed a law firm form, dated August 10, 2006, entitled "Client Information." CP at 561 (some capitalization omitted). The form indicated that John Eakin wished a patent for a method of dispensing bactericide. The sheet identified John Eakin as Client No. EA12. Svendsen also sent a thank you card to Wes Gano for the referral.

The parties provided no information as to whether Chris Svendsen called John Eakin after the conflicts check, and, if so, the nature of the remarks made between the two during any such conversation. We note that, during the August 2 phone call, Eakin had told Svendsen "to wait to hear back from him." CP at 488.

John Eakin displayed his second prototype of the cattle footbath at the 2006 Dairymen's Show in Boise, on November 11-13, 2006. An Occupational Safety...