According to Wikipedia, Lady Justice has been depicted with a blindfold since at least the 16th century, with the blindfold representing impartiality. When impartiality of the system, or the judges who are charged with administering the system, is questioned, it is a very big deal. That is why the Code of Conduct applicable to Article III federal judges appointed as Constitutional judicial officers mandates that a judge disqualify himself or herself when there is even the appearance of impropriety. It seems that no such rule applies to Administrative Patent Judges (APJs) who make up the Patent Trial and Appeal Board (PTAB), which is astonishing. Indeed, we have found yet another example of a situation where a PTAB judge has issued a decision and is participating in post grant administrative proceedings as a judge in a case where a former client is the petitioner.
According to information from PACER, Margolies represented Apple as counsel in Fast Memory Erase LLC v. Spansion Inc. ET. al. (ND Tex 3:08-CV-00977). Apple was named was a defendant and counter-claimant in this patent infringement action. The case was terminated in August, 2012 and there is no indication in PACER that Margolies was terminated or removed as Apple’s representative from prior to the termination of this matter.

Is ethical bar higher for practitioner?

The problem for the Patent Office and those who defend the actions of APJs sitting in judgment of petitions filed by former clients is that there is no time limit on the conflict of interest created by a former client for practitioners, and there is no time limit on conflicts and the appearance of impropriety for Article III federal judges appointed as Constitutional judicial officers. So if the generic ethics rules for all employees of the USPTO, which only require a 1-year recusal period with respect to dealing with matters of former employers, is the only policy or Code of Conduct applicable to PTAB judges then that would mean that the practitioners who appear before the PTAB have substantially higher ethical requirements than do those who are sitting in judgment, which is absolutely absurd. If anything the higher ethical standards must be placed on those who sit in judgment, which is exactly what is done for Article III federal judges who are required to disqualify themselves from matters even when there is an appearance of impropriety.

Problem associated

APJ Matt Clements issuing decisions in post grant patent review proceedings petitioned by Apple a mere 18 months after representing Apple as a defendant in patent infringement cases is extraordinarily problematic, perhaps far more so than Margolies deciding petitions four years later. It is also particularly concerning that Clements has participated in so many post grant proceedings — we’ve identified 17 so far where his former client (Apple) was a petitioner. Margolies has only sat on two panels currently adjudicating patent challenges brought by her former client, which also happens to be Apple. But the appearance of impropriety and what should be required of judicial officers cannot be excused as de minimus.
The problem seems to be that the United States Patent and Trademark Office does not have a specific Code of Conduct for APJs, instead applying the same general and extremely lenient ethical standards on PTAB judges that they do on all employees.

Conclusion

Interestingly, in April 2013 the USPTO updated the practitioner Code of Conduct to more directly coincide with the Model Rules of the American Bar Association, which are followed in various forms by most States. If you look at 37 CFR 11.803(b), practitioners commit an ethical violation for failing to report APJs who have violated the applicable “rules of judicial conduct.” § 11.803 reads:
“A practitioner who knows that a judge, hearing officer, administrative law judge, administrative patent judge, or administrative trademark judge has committed a violation of applicable rules of judicial conduct that raises a substantial question as to the individual’s fitness for office shall inform the appropriate authority.”