Tuesday, May 30, 2006

The Recorder on IP boutiques: business is booming

The Recorder: Two years ago, Palm Inc. General Counsel Mary Doyle spent 20 hours combing the Web for patent lawyers. Her target was the smallest of IP boutiques, with no more than three to six lawyers. Today, they are no easier to find.

"They don't get a lot of attention, yet they are the bread and butter of our patent prosecution strategy," she said.

While some of these mini-boutiques are so small they don't even have an online presence, what they have to offer is irresistible to GCs constrained by tight budgets: a highly specialized legal expertise, familiarity with the industry and cost competitiveness.

One sees that (applications/dollar) is a key factor:

"Like most [Silicon] Valley companies, we look for exceptional quality at a good price," Doyle said. "We're looking to file as many patent applications as we can for our investment dollar. In our experience, big firms can't consistently compete on price in this area."

One sees that the lawyer's hourly rate is also a factor:

"At Skjerven as a senior partner I would make 50 percent of my billings," Brian Ogonowsky said. "Here [Patent Law Group] I make 75 percent, so I make a lot more money, and I don't work as hard."

Part of the micro-boutique strategy is to pass the cost savings onto the client. The Patent Law Group's four lawyers, all senior-level, charge between $250 and $340 an hour.

"I have more than 20 years of experience," Ogonowsky said. "I would be billing $500 per hour at a large firm."

Are good patent attorneys scarce?

While IP boutiques are quite happy to exist in their little niche, they do acknowledge one major threat from the bigger firms: the ability to recruit seasoned attorneys.

"With patent law you can't just be a good lawyer. You need to have a good technology background, so it's hard to find lawyers with good tech backgrounds," said Magen.


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