The best patent attorneys do not work at the biggest firms. They run under the radar and are hard to find.
Two Kinds of Solo
There is a class of patent attorney you have never met.
They have twenty-five years of experience, built by seeking out every part of the patent system they could reach. They did a stint in-house to learn how a company runs its patent program. They have litigated patents, so they know how to take one apart. Some have worked inside startups. Some have handled transactions that sold IP.
They have sat on the other side of the table. They know what it is like to live with a patent after it issues.
They are entrepreneurial, and they never stopped learning.
They do not work at a big law firm. They went solo, or they joined a two-person firm with another attorney like them. They set up a laptop, a USPTO account, and a home office. They do excellent work where they know they are delivering huge value and making a comfortable living.
You have probably never heard of them, because they do not have a marketing department, a downtown office, or a name partner who plays golf with your board member. But they are producing the best patent work available in the market.
There is a second group of solos: refugees from Big Law. They spent five to ten years on the “partner track” and washed out of “the system.” For whatever reason, the partners did not elect to keep them. They could not make enough rain. In Big Law, you do not get rewarded for doing good work, you get rewarded for making more rain. In fact, the worst attorneys from a work product standpoint often get promoted to partner because they bring in huge clients.
Those that wash out of the partner track have to move laterally to other law firms, but their chances to make partner diminish dramatically with each move. At some point, they are “of counsel” at a firm or try going solo.
The second group is a one-trick pony. They were trained in Big Law and know Big Law procedures, Big Law billings, Big Law focus. They have never lived with the consequences of their work product. They have never reported to the CEO about how their patent cannot be used to sue a competitor because of a few “patent profanity” words in the claims. They have never felt the real pressure inside a business to put the patents to work.
There are plenty of solos in the second category, but few in the first.
The problem is that most companies cannot use the first group.
Not because the attorneys are hard to find. Because the companies make difficult clients. (That is next week’s post…)
Why Big Law Costs What It Costs
The Big Law model is that you grind for 5-10 years on the “partner track.” The holy grail is that you become equity partner, which means you get the skim of 1/3 from all the work you bring to the firm. This is extraordinarily lucrative to the partner, often a million dollars a year or more.
Charlie Munger said that Big Law is a pie-eating contest where, if you win, you get to eat more pie. This is what he meant.
When you hire a Big Law firm to write a patent, roughly a third of your fee goes to the attorney doing the work. A third goes to overhead. A third goes to the partner who brought in the client and “supervises” the work.[1]
The incentives for Big Law are that the partner gets rewarded for finding new clients, not for good work product. The partners are often the worst practitioners but always the smoothest talkers.
The partners can be billing $1000 or even $1500 per hour, but they are hamstrung by that rate.
At $1000/hr, a partner cannot write a patent application or respond to an examiner’s rejection. They learned under a billable hour system that rewards slowness (they call it “thoroughness”). They were never efficient and never focused on quality. If the $1000/hr partner tried to do the work using their poor training and bill-by-the-hour slowness, the client’s bill would be outrageous.
And here is the part that never gets said out loud: the client never gets the partner’s work product. The partner does the intake meeting, takes notes, records it, and hands the file to the proverbial first-year associate in the windowless back room. The associate has written a handful of patent applications. The associate has never worked in the startup’s industry. The associate is learning on the client’s dime because the budget is too thin for the partner to justify spending time on it.[2]
The startup is paying Big Law rates to train Big Law’s least experienced attorney.
Fixed Fee Takes Confidence
Being a solo attorney and working fixed fee takes a lot of confidence.
The attorney needs to know they can deliver a quality work product, and they need to know that they can do it efficiently.
Some solos still track their hours like they were taught when they came out of school and started at a law firm. They celebrate if they can do a good-enough job and come under their fictitious “budget.” They shut down when they go “over their budget” and try to finish the work as quickly as possible, often by taking short cuts or skipping things they would do otherwise.
Solos who track their hours still have the Big Law mindset that their “worth” is based on their billable rates. This kind of attorney will tell me their billable rate within the first 10 minutes I meet them.
Solos who are comfortable in their abilities and value they provide never hesitate to work on fixed fees. They know they are efficient. They know they can get to the heart of the matter quickly. They know they can do quality work quickly. They know they can make far more money per hour than their bill-by-the-hour friends simply because they are good at their jobs.
I am currently buying patent attorney services for one of my Chief IP Officer (CIPO) clients, so we are interviewing for potential attorneys.
After interviewing a bunch of solos recently, billable hour attorneys start out with the fear that the client will misbehave. One attorney told me straight up that the billable hour is the way he controls bad client behavior. He specifically was worried that he would write a patent application, then the client will come back and add three more examples after he is done. He could not bear the inconvenience to assist his client in that way.
The billable hour solo attorney is asking me to take the risk that they will not be efficient, and the attorney needs to be able to punish me if my instructions are not complete. They need to be in control, without any recourse or negotiation.
He begins every engagement assuming that his clients will treat him poorly, and he wants to prevent that from happening. Did he forget that he could walk away from the client at any time? Is he so afraid that one patent application might go terribly wrong and he will “lose money” because he did not scope the work correctly?
Obviously, if I engage a fixed fee attorney, the attorney is taking the risk that I will not move the goal posts, that I will not make them work endlessly for a fixed fee.
Many billable hour attorneys want to hedge their bets using “budgets” and “phases.” They might propose a first engagement to be $5000 as a first phase, and then they will tell me how much it would cost to finish the job.
They often recognize that the client is worried about the attorney telling them after the fact how much it will cost, so they put a “cap” on the work. “I will bill $600/hr not to exceed $12,000 total.”
This is a terrible strategy for both the attorney and the client.
First, the client always has that sneaking suspicion that they will pay the max.
Second, the attorney takes the risk that if they do a good job and are efficient, that they get paid less, not more. Their incentive is always to bill the cap.
The Billable Hour with a Cap Charade
Then the attorney does this charade where they say “I really billed $13,000 on your case. Look how virtuous I am that I ‘gave’ you this ‘extra’ work!” The attorney feels virtuous by showing how much they “sacrificed” for their client.
This whole story is told from the attorney’s perspective. The client sees patents and lawyers as a bothersome expense. The client does not care that the attorney worked late to finish the job. The client already stays late at work. The client already works Saturdays or Sundays. The client never sees the attorney as “sacrificing” when they are getting paid nearly 5 or 10 times what the client is getting paid.
In fact, the client views this charade for what it is. Does the client feel the attorney’s pain? No. The client expects the attorney to go above and beyond. By showing the client how much “extra” work their matter requires, the attorney is setting the groundwork to raise the “cap” next time around, but the client is trying to do the opposite.
The client sees the attorney subtly saying that they were not worth what they said they were. The attorney himself did not feel that his work product was good enough for the price.
I see this time and time again with solo practitioners struggling to find new clients.
The attorney does not have the confidence in themselves to charge fixed fee.
The attorney does not have the confidence to realize that if they are good and if they are efficient, the hourly rate is a ceiling that limits how much they make. They don’t have the confidence to improve their work product, improve their skillset, improve their processes so that they can work less and get paid more.
When I review the work product, the confident fixed-fee attorneys generally produce good work.
The hourly rate attorneys produce work that is designed to be edited, re-edited, and re-edited again. The worse they make the product, the more they get paid.
There are exceptions to every rule, of course. There are lots of bottom feeder, cut-rate fixed fee attorneys who use AI or other shortcuts to do volume work. I have seen plenty of those. Maybe there are attorneys producing good work on the by-the-hour model, but I have never met one.
The quality does not drop with solos. It rises.
The person who meets you is the person who writes the patent. The person who understands the invention is the person who drafts the claims. There is no handoff. There is no tape recording passed to a junior associate. There is no partner “reviewing” work they did not write.
One attorney. Your attorney. Doing the work.
The Math for the Client
The best attorneys for this model are not junior. They are not cheap because they are inexperienced. They are affordable because they are efficient, and because the system removes every cost that is not their expertise.
The truth is that fixed fee attorneys who focus on the highest quality and good processes make far more than most patent partners at Big Law. They do this by focusing on quality and doing good work for good clients, not by playing Big Firm politics.[3]
The numbers are not subtle.
Under the conventional Big Law model, a patent family might cost $34,000–$60,000 from filing through grant. The effective attorney hourly rate is $400–$800. The average case takes 4.2 office actions.
Under the managed model using solos, which we will discuss next week, a patent family might cost $23,500–$43,200. We can reduce the pain points of the solo, make them more efficient, and more effectively “steer” our solo outside counsel, reducing the number of office actions.[4]
That is 30–40% less per patent family. With better attorneys. Producing higher quality work. Faster overall.
The Math for the Attorney
At a law firm, some of the pain and suffering (i.e., administrative work) is done by paralegals, accounting, and other staff. The other big thing about the law firm is that they have a steady stream of work.
The tradeoff is that for every dollar of real work you did, you paid dearly for the overhead and you paid dearly for someone else to find the work.
The solo attorney has to do the administrative work themselves, or pay for it. I never enjoyed the admin work, but I did it myself. As a solo, I was the only person responsible for finding new clients and convincing them that I could do the job. Even when I had big, consistent, reliable clients, I always had periods where I only had work for the next week or two, then nothing.
The tradeoff is that I was probably priced about 2/3 of Big Law, but I kept 100%. That meant for every patent application I wrote, I either had twice as much time as Big Law to do a good job, or if I was efficient (which I was), I was making twice the amount of money as the Big Law associate doing the work.
When you realize the amount of “fat” in the law firm model, you realize that someone is getting paid for doing “nothing.” Someone brought in that client five years ago and they are pocketing 1/3 of all the billings for years and years without actually doing real legal work.
Next week’s post will talk about what it takes to engage the best of the best solo attorneys.
The Punchline
If you are using a law firm, you have been paying premium rates for junior work. The Big Law name on the letterhead does not transfer to the quality of the work product — because the person doing the work is not the person whose name is on the letterhead.
The alternative is not cheaper attorneys. It is better attorneys at lower cost, but you need a system that is set up for it. We will talk about that system next week.
The highest quality patent work at the lowest cost is not a contradiction. It is what happens when you stop paying for everything that is not the work.
1 The Big Law fee structure — one-third to overhead, one-third to the partner, one-third to the associate doing the work — is described in The Tradeoffs and Considerations for Patents in Investing in Patents. ↩
2 The partner-to-associate handoff and its impact on patent quality for small clients is covered in The Tradeoffs and Considerations for Patents in Investing in Patents. The pattern is consistent: the partner does the intake, the associate does the drafting, and the client never knows. ↩
3 The economics of solo practitioners and small firms — lower overhead, fixed-fee comfort, and higher take-home at lower billing rates — are described in The Tradeoffs and Considerations for Patents in Investing in Patents. ↩
4 The full cost comparison between the conventional Big Law model and the managed CIPO + solo/small firm model is in What Good Patents Cost in Investing in Patents. ↩
