U.S. Court of Appeals Affirms District Court’s Remand of Legal Malpractice Case to State Court

The U.S. Court of Appeals for the Federal Circuit has ruled that it lacked jurisdiction to entertain an appeal of a remand order by a U.S. District Court in a legal malpractice suit. In ARC Products, LLC, v. Kelly, a company brought a legal malpractice claim against its former attorney who represented it in patent application proceedings for two plastic transportation devices. The company claimed that the attorney’s negligence caused the U.S. Patent and Trademark Office to reject the application for one of the devices.

The company filed its suit in a state court in Missouri. The attorney then removed the action to the Eastern District Court of Missouri on the grounds that the complaint was based on federal patent law. Once in federal court, the company moved to remand the case to state court. The company asserted that the case was based on state contract and negligence claims and did not require a resolution of substantive issues involving federal patent law. The District Court agreed and granted the company’s motion.

The attorney then appealed to the U.S. Court of Appeals for the Federal Circuit. Under relevant case law, a federal appellate court is prohibited from reviewing a remand decision, which is based on lack of subject matter jurisdiction. Since it was clear in the District Court’s Order that its ruling was based on lack of subject matter jurisdiction, the Court of Appeals found that it had no authority to hear the appeal and thus granted the company’s motion to dismiss the appeal. The case thus proceeds in Missouri state court.

Decision: ARC Products, LLC, v. Kelly


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