By 2010, the IP market was unstoppable. Patent reform, technology booms, and predatory litigation fueled unprecedented growth. The opportunities available to law firms made IP a gold-prize practice. In 2014 the gold nuggets in IP are a lot harder to find—but may be worth even more.
IP—including IP litigation—is under attack. The assailant? Corporate counsel.
While law firms have enjoyed a steady stream of IP work over the past 4 years, corporate counsel have been quietly changing their mindset. Decision makers are showing less and less interest in the never-ending, expensive approach of defending all IP at any cost. Instead, clients are moving ahead with more focus and a keener sense of priority when it comes to their IP portfolios.
Expect the impact of corporate counsel’s new approach to be in full swing by Fall 2014.
- There will be less IP work—and money—heading to law firms.
Active IP caseloads shrank by nearly 12% from 2012 levels.[1] In the second half of 2014 through 2015, IP decision makers plan to carefully increase their IP caseload by only 8%. IP budgets are under even closer scrutiny and only expected to grow 1.1%. Expect heightened rate pressure, aggressive settlements, and for routine work to head in-house. - Clients eye smaller law firm rosters to gain strategic advantage.
Corporate counsel using the same firm for prosecution, litigation, and counseling are happier with their law firm. These integrated law firms are able to develop a deep understanding of the client’s IP portfolio and needs; providing both efficient handling of routine matters and strategic insight and guidance for more complex issues. To earn the position of primary IP provider, law firms will be best-served by diving into the stream of patent prosecution work and integrating litigators and counsel into the mix once the firm has proven its worth. - Boutique providers play a key role—but can they provide the full package?
Apart from a few unique cases, most law firms have acquired the depth of knowledge needed to serve clients. Corporate counsel seek firms able to provide expertise, strategic guidance, business-savvy, and superior client service. Only a few firms have been able to answer the call so far.
As clients redefine their approach to IP, major opportunities are available to the law firms able to make these trends work in their favor.
[1] Based on BTI research conducted from December 3, 2013 and June 10, 2014. BTI conducted more than 175 independent, individual interviews with General Counsel and IP decision makers at Fortune 1000 companies and large organizations. The results of the research are available now in BTI’s Intellectual Property Outlook 2015: Changes, Trends and Opportunities in IP & IP Litigation.