One-hundred % of patents make money for their lawyers, but very few–some estimates say 5% or fewer–make money for their owners. This disconnect is striking when you say it out loud, but few seem to recognize that it exists. Perhaps this is because it works very well for the “Patent Industrial Complex.”
To this end, every intellectual property law firm has bills to pay, appearances to maintain, and risks to mitigate. This can certainly be tough to see when one is working to grow a successful legal practice, as I did in an earlier part of my career, but the thought did arise from time to time. A well-known IP lawyer I worked used to say to clients seeking advice–in a now-apparent non-admission-admission sort of way–“this is a fox guarding the hen house situation.” Of course, one might hope that the fox makes the right decision, the nature of the fox cannot be ignored when the client sets up expectations for outcomes.
My perspective on lawyer incentives changed when I left the law firm environment to join an in-house legal team. From this vantage-point where I managed my prior peers, I saw that it is necessary for someone with expertise to act as “referee” to make sure the client’s interests are properly managed and protected. Or, as a friend of mine who does IP valuation says, “if you need an expert, sometimes you may need two.” Of course, most companies do not have the need budget for a full time legal team, but this does not eliminate the need to have someone tasked to make sure that the best interests of the client are being served by those hired to serve the company.
In this detailed article, I provide insights about the status quo of patent acquisition today, and give guidance to how those seeking to create business value can better align their intellectual property strategy efforts to obtain their desired outcomes.