A District of Columbia Superior Court judge dismissed malpractice claims against McDermott, Will & Emery on Friday, finding the plaintiffs were trying to re-litigate issues already decided in a related case in California.
A former McDermott client, Theranos Inc., accused the firm of failing to take steps to prevent a former firm partner, John Fuisz, from accessing confidential information. Theranos claimed Fuisz, who didn't represent the company, provided confidential intellectual property information from Theranos' files to family members pursuing competing patents. The firm said it wasn’t aware of any misconduct by its attorneys.
Theranos sued Fuisz and his family members in U.S. District Court for the Northern District of California, but a judge dismissed claims against Fuisz in June 2012, finding California's one-year statute of limitations had expired. The lawsuit filed in Washington was against McDermott, and not Fuisz, but Superior Court Judge Craig Iscoe found the two cases were based on the same "nucleus of facts." As a result, Iscoe wrote, the California decision represented a final judgment on issues raised in the D.C. litigation.
"Without John Fuisz being guilty of some sort of misconduct, it is inconceivable that McDermott could be liable," Iscoe wrote, adding later that, "It would be a waste of judicial resources and unfair to the Defendant if Plaintiffs were entitled to get a second chance based on their strategic decision to not include McDermott in the California litigation."
Steptoe & Johnson represented McDermott. Partner Roger Warin, chair of the firm’s executive committee, said in an email today that McDermott "is delighted with the decision, and believes that the Superior Court judge fully understood and correctly dealt with the issues raised by the motion." Litigation partner Steven Davidson handled oral arguments.
Fuisz, in an email, said he was pleased with the ruling. "Theranos could not cite to any facts to support their preposterous claim," he said. "The allegations were pure fantasy." Fuisz left McDermott in 2009 and formed the Fuisz-Kundu Group, a two-person firm focusing on intellectual property law.
Theranos and its chief executive officer, Elizabeth Holmes, were represented by Boies, Schiller & Flexner. A Theranos spokesperson and Boies Schiller attorneys, including partners Tanya Chutkan and William Marsillo, couldn't be reached for comment.