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Side-Switching Lawyer Zapped From Sony PlayStation Suit
New Jersey Law Journal
November 25, 2009
Craig Thorner is an inventive whiz when it comes to video game gizmos, but he hasn't had much luck with lawyers.
In May, he sued New Jersey's premier intellectual property boutique, Lerner David Littenberg Krumholz & Mentlik in Westfield, alleging a breach of duty to him in negotiations over licensing of game-control technology. The suit also claims that a Sony Corp. subsidiary infringed Thorner's patents.
But the lawyer Thorner hired to bring the suit, Glen Diehl, is not only a former Lerner David lawyer but worked on Sony matters for the firm. A judge disqualified him on Nov. 20 for unethical side-switching.
U.S. Magistrate Judge Douglas Arpert in Trenton, N.J., who made the ruling, gave Thorner two months to find yet another lawyer to replace Diehl and his firm, Diehl Servilla in Clark, N.J., in Thorner v. Sony Computer Entertainment America, Inc., 09-1894.
Diehl argued it would be impossible for Thorner to find a counsel able to grasp the facts and issues in the case. If so, it's a nice win for Sony and Lerner David.
Sony hired the firm in 2004 to appeal an $82 million jury verdict in California obtained by Immersion Corp. in a suit alleging that its vibrator technology had been infringed for use by Sony in PlayStation products. Thorner was part of Sony's strategy to win a new trial by presenting new evidence.
Thorner and his company, Virtual Reality Feedback Corp. of Brick, N.J., hold patents on tactile sensation generators that produce vibrations and other sensations that correspond to events playing out on the screen of a video game.
According to his suit in federal court in Trenton, he suspected that both Sony and Immersion had infringed his patents. But he let Sony recruit him to its cause and testified at the hearing for a new trial that the technology claimed by Immersion was prior art that he had created, the suit says.
In the meantime, Lerner David partner Gregory Gewirtz helped Thorner obtain a licensing deal with a third company worth $150,000 plus royalties and Gewirtz said he would represent Thorner if he had any legal problems with Immersion, the suit says.
But the licensing deal turned out to be a dud that deflected Thorner's attention from the possibility that Sony was infringing his patents, and Gewirtz helped make it happen instead of looking out for Thorner's interests as promised, the suit alleges.
Gewirtz and his lawyer, Frederick Dennehy of Wilentz Goldman & Spitzer in Woodbridge, N.J., did not return calls on Tuesday.
But in answers and counterclaims they say Lerner David had nothing to do with the licensing agreement and represented Thorner only as a witness in the attempt to get a new trial in the Immersion case.
Gewirtz advised Thorner at a meeting in May 2005 that Lerner David represented Sony and could not represent Thorner in the licensing negotiations, and that he should get a lawyer of his own.
"Thorner responded that he negotiated the terms without counsel and was comfortable proceeding without retaining counsel on that matter," the answer says.
What's more, Gewirtz says in a third-party abuse of process claim, the suit was filed only after the firm rejected a demand in 2007 for help in getting Sony to give Thorner a $25 million licensing agreement.
The defense also asked the judge to throw Diehl out of the case, and he did.
The crucial issue was whether Diehl's work for Thorner in the case against Lerner David and Sony is "substantially related" to the work Diehl did for Sony during his time as counsel to Lerner David from 2001 to 2004. If so, his knowledge would give him an unfair advantage in the litigation to the detriment of a former client.
Diehl argued that before he left the firm he had never heard of Thorner, vibration technology or the licensing issues that occurred after the Immersion verdict.
The small amount of patent work he did on Sony PlayStation products was limited to the writing of one brief involving a peripheral pro se adversary and a motion to transfer a case -- nothing that involved strategic discussions about Sony, Diehl argued.
But Arpert said the evidence showed that Diehl had attended training courses on PlayStation products and spoke with engineers who designed the systems.
"Diehl's arguments fail to acknowledge that as an attorney at the Lerner David firm he had access to Sony personnel, information and documents related to Sony's PlayStation systems and products," Arpert said.
That "makes it impossible to narrowly limit the type and scope of the information to which Diehl may have been privy," he concluded.
Diehl and Thorner did not return calls.
