Litigators, Small Law Firms

Beyond Biglaw: Handicapping An Appeal

As with anything else in law, practice and preparation usually lead to positive results.

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Playing “judge” is fun, and is something that experienced litigators get to do on occasion. While I was in Biglaw, I would occasionally be asked to assist a fellow partner or litigation team by critiquing a mock argument. When I felt it would be helpful on my cases, I would not hesitate to ask others for similar help. In our current firm, we constantly vet each other’s arguments, particularly before an important hearing. But I don’t need to convince anyone of the value of mock arguments, or the importance of soliciting feedback from experienced colleagues. What I want to focus on instead are the considerations that go into handicapping an appeal for a client, since this type of assignment can present some challenges for even experienced counselors.

If a client approaches you to handicap an appeal, whether it is for a case you handled below or for a “shadow counsel”-type situation, an honest assessment of whether to call in an appellate specialist for assistance should be undertaken immediately. If you do not have the requisite experience before that particular appeals court, for instance, make sure you communicate that fact to the client. There are plenty of qualified appellate specialists, at firms big and small, and many of them are very skilled at collaborating with existing counsel. In my experience, appellate lawyers often go out of their way to make trial or existing counsel “look good” before the client. Of course, being easy to work with is good for an appellate lawyer’s business — as is being surprisingly affordable to bring on, relative to the amount in dispute or fees already expended on a matter.

For purposes of this discussion, we can assume that the engaged lawyer is qualified to offer guidance on an appeal. In our practice, working on appeals usually takes two forms: 1) an appeal for an existing client based on an underlying litigation where we served as trial or co-counsel or 2) handicapping an appeal for interested third-parties. More often than not, we are doing so on behalf of an “investor” (hedge fund, family office, etc.) client, who may have or be considering a position in one or both of the litigants in the appeal. While the level of attention we are able to give to assignments for investors may be much more limited than what we can do for existing legal clients — because of a combination of cost concerns, reduced access to confidential information, and timing reasons usually — we have found with the right level of focused preparation, our handicapping efforts tend to be money well spent for investors.

So how do we approach analyzing a patent appeal before the Federal Circuit for an investor? Doing so usually involves an abridged (again, due to time or budget limitations) version of the preparation we put into handling appeals for legal clients. First, it is important to approach the task with a bit of humility, and appreciate that the existence of the appeal in the first place is often an indication of hotly disputed, and not clear cut, legal issues below. With that mindset, the next step involves a close review of the filed briefs on both sides, with a special focus on the underlying District Court decision(s) they address. Then, it is worthwhile to consider the standards of review for each of the issues presented, since many appeals turn on the application of those standards. Likewise, it is important to analyze whether the appeal presents any “hot issues,” especially those that have been recently addressed by other decisions from that court. If it does, it is critical to try and see whether the appeal you are studying is susceptible to a decision in line with the momentum of recent pronouncements on that particular issue.

An important piece of the puzzle, especially for time-sensitive assignments, is the oral argument before the panel. We are often called on to provide an opinion around the time of such oral arguments, because the market tends to react to news from oral arguments in important (i.e., market moving) cases, especially if the word gets out that the panel strongly favors one side. If the budget allows, attending in person is ideal, since doing so affords the opportunity to prep as though you will be arguing for either side. The other advantage of attending live, at least in courts like the Federal Circuit where there are only oral (not video) recordings of arguments available, is the ability to assess the body language of the panel. I learn a lot from watching the judges, and in fact try to limit my note-taking while watching a live appeal argument. The time to take notes is when I relisten to the oral recording (or listen for the first time when I did not attend live) of the argument. As I listen, I try to focus on the questions asked, and understand why the judge is asking that question, along with what answer is desired in response. Likewise, it is important to keep track of how many questions are asked on a particular issue, and by which judges. There is no better evidence of the issues that the panel considers important than the questions they use to challenge appellate counsel at the podium.

The preparation, from reading the briefs to listening to the oral argument and everything in between, all leads up to the presentation of our findings to the client. As mentioned above, the market can react to oral arguments, but the critical “move” often comes on the release of the actual decision. Accordingly, being able to predict how the appeals court will rule on certain issues, as well as the timing of the decision’s release, can be very valuable information in the hands of sophisticated traders.

Because of the importance of issuing as accurate a prediction on the result as possible, it is important to prepare a short written summary of the issues in the appeal, together with your predictions on each issue, as well as the one or two strongest points that undergird that prediction. Even if the client does not want a written work product, doing so is helpful, especially to make sure you do not miss any major insights when offering your oral opinion to the client. When presenting the analysis to the client, it is important to avoid getting deep into the weeds of the legal issues, and focus on presenting the basis for your predictions, as well as the depth of your confidence in those predictions, as clearly as possible. You can save your “inside jokes” about various members of the appellate panel for another time. Ultimately, handicapping appeals gives rise to some of my favorite assignments — they are intellectually demanding, interesting, and of high value to our clients. I can’t guarantee that I, or anyone else, will always be right when handicapping an appeal, but as with anything else in law, practice and preparation usually lead to positive results.

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Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique. The firm’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

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