Raymond Niro, Niro, Haller & Niro, partner..courtesy photo 2011
Raymond Niro, Niro, Haller & Niro, partner..courtesy photo 2011 ()

SAN FRANCISCO — An Illinois federal judge has sanctioned Raymond Niro Sr. and his law firm in a wireless patent case, finding that Niro and three of his colleagues knew about a client’s false declarations to the U.S. Patent and Trademark Office before filing a lawsuit on his behalf.

U.S. District Judge William Hart on Friday held Niro, Haller & Niro jointly and severally liable for what’s likely to be several million dollars in attorney fees assessed against Intellect Wireless and inventor Daniel Henderson. The ruling ends a year of hotly contested wrangling over what Niro did and didn’t know, delivering a black eye to one of the country’s most prominent patent lawyers.

“The false presentation of Henderson’s activity and knowledge justifies making Niro jointly and severally liable with IW for attorney fees and costs,” Hart wrote in his order.

Niro did not immediately respond to an email seeking comment Friday evening. Niro, partners Paul Vickrey and David Mahalek and former partner Paul Gibbons have filed declarations saying they knew nothing about an email Henderson sent to his patent prosecutor in 2007 raising loud alarms about false declarations filed with the PTO. Henderson had warned that false declarations filed on his behalf presented a “potentially lethal blow” to his patent portfolio, and asked that his litigation counsel at the Niro firm be consulted about it.

HTC Corp. and its attorneys at Sheppard, Mullin, Richter & Hampton say it was “inconceivable” that Niro and his colleagues didn’t hear about Henderson’s concerns long before suing HTC in 2009.

Hart sided with HTC on Friday, concluding from the Niro firm’s unwillingness to produce certain documents in discovery that the lawyers knew Henderson had lied about his invention at least by 2009, “if not before.”

“Therefore, Niro is liable for all reasonable attorney fees and expenses incurred by HTC,” Hart wrote.

HTC has asked for $4.7 million, plus additional fees for briefing the fee motion. Niro has argued the tab should be no more than $2.3 million. Hart did not determine a final amount, but appeared likely to end approximately in the middle after granting some of Niro’s objections while denying others.

“We are very pleased with Judge Hart’s decision,” Sheppard partner Stephen Korniczky said. “We have believed from the outset that this is a lawsuit that never should have been brought. Judge Hart’s decision vindicates HTC’s position.”

Contact the reporter at sgraham@alm.com.