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[smgsmc]

Hi.  Do some law firms apply a degree of difficulty factor to billable rates?  At my firm we handle patent applications with a wide range of technical sophistication.  Some require only a high-school education to understand; others require advanced grad-school training.  Since I have a PhD and many years of experience in industry, I’m assigned the more difficult cases.  However, the billable rate here depends primarily on whether you are an attorney or an agent and on years of experience (presumably, you work more efficiently over time and can have a higher billable rate because you can complete a job more quickly).  However, there is no distinction in billable rates between an application for a better mousetrap (so to speak) and a new quantum optics device.  End result is that I don’t receive extra compensation for my advanced technical knowledge.  Are there firms who do pay more for more technically demanding cases?  Thanks.

[klaviernista]

I've never heard of a firm charging a higher billable rate based on technological sophisticatrion of an invention.  It seems unnecessary in any respect, as an application drawn to more difficult technology will generally take longer to draft/prosecute than a simple invention, and thus, the total fee (based on hours) would be higher for the harder application.

[10YearReg]

Hi.  Do some law firms apply a degree of difficulty factor to billable rates?  At my firm we handle patent applications with a wide range of technical sophistication.  Some require only a high-school education to understand; others require advanced grad-school training.  Since I have a PhD and many years of experience in industry, I’m assigned the more difficult cases.  However, the billable rate here depends primarily on whether you are an attorney or an agent and on years of experience (presumably, you work more efficiently over time and can have a higher billable rate because you can complete a job more quickly).  However, there is no distinction in billable rates between an application for a better mousetrap (so to speak) and a new quantum optics device.  End result is that I don’t receive extra compensation for my advanced technical knowledge.  Are there firms who do pay more for more technically demanding cases?  Thanks.

Not that I know of, but I agree with your point.

Anybody can do a mechanical patent.
Few can do a high level EE patent.

Certainly there should be a salary premium for the EE, bet there is not.

Why not? 

Because that's the way it is done and always has been done.

I think the logic goes - Paying people with the same years of experience different salaries leads to more problems than it solves.

In other words, it's easier to get the EEs to suck down equal pay than it is to get the Chem Es, Mech Es, Physicists, and Bio folks to take less.

[stuffball]

I have never heard of firms doing this.  It doesn't seem to me to be a bad idea... but the rating system (rating the complexity) would have to be somewhat subjective.  I can see how a subjective system that ultimately controls how much clients pay might not be very popular with the clients.  Negotiating complexity-dependent billing rates with certain clients would certainly be headache forming and probably not worth the trouble.

More complicated tasks simply get more hours billed and hourly billing appears to be objective.  Obviously, hourly billing really isn't objective and one can always argue that the time billed to do any particular task was excessive.  My guess is that law firms would rather argue over hours already billed than over billing rates before the work is done for pretty obvious reasons. 

[smgsmc]

Thanks for your responses.  I’ve just completed two years as a patent agent now and need to decide whether to stay in IP or to return to engineering before my knowledge becomes too outdated.  10yrReg has the full grasp of my issue...which is the hourly rate at which the atty/agent is compensated.  This billing structure is rather peculiar.  In industry (on a per hour basis), an engineer is compensated more than a support technician.  In medicine, a neurosurgeon is compensated more than a general practitioner.  There’s the old cliche, “It ain’t rocket science!”  Ah, but what if it is rocket science?  It’s perplexing to me that an atty/agent working on a sophisticated missile guidance system would be compensated at the same (or lower) rate as an atty/agent working on an improved tricycle.  Or that an atty/agent working on quantum optoelectronic devices and sophisticated mathematical algorithms for digital imaging is compensated at the same (or lower) rate as an atty/agent working on an improved tripod.

[stuffball]

But billing rate for the client does not necessarily correlate to law firm employee compensation, in my experience.  Where I work people with advanced technical backgrounds do get better compensation than those without the advanced technical backgrounds when the two have the same level of legal experience.   This is true even if the billing rate is the same.  When I was a patent agent, for example, I was getting around $115k + law school tuition primarily because of my advanced degrees.  Other patent agents in our group with less technical experience were getting paid in the 90s even if they had a few more years experience in patent prosecution than I did. 

In any event, I do really think it's subjective.  I agree that some inventions are obviously more technically sophisticated than others.  However, difficulty in writing a good patent application stems from both the technical and the legal aspects.  Some of the hardest claims to write are for door knobs and things that even a child could understand.  On the other hand, claims for a new method of synthesis (however complicated) practically write themselves.  My point is that the blending of legal and technical issues makes the determination of the "complexity" or "difficulty" of writing any given application rather subjective.  Charging more for supposedly difficult or complex applications would be walking into a minefield.

[Wiscagent]

I don't like the billable hours, $/hr approach.  For applications I have handled where I had control of the billing, when initially talking to a client, I always give a very broad cost range.  If the client wishes to move forward, I then review the disclosure and get back to the client with a firm quotation.

There is no reason for the client to know or care how many hours the job took.  What is important to the client is that I do an excellent job and provide outstanding service.

If I am so fast and efficient that my quote corresponds to $1000/hour, the client is happy, and I've done a good job with the application -- well, good for me.  If I underbid, have health problems, have to learn some new technology, and work so slowly that my quote corresponds to $10/hour, but the client is happy, and I've done a good job with the application -- well, that's too bad for me, but the important part is that I've delivered a good product and fulfilled my professional responsibility.

While law firms commonly use the billable hours, $/hr approach; it's not too unusual for a major client to negotiate flat fees for a guaranteed volume of work.  I'm not familiar with the details of those contracts, but it's likely that those contracts include some language about the difficulty of the work or the kinds technologies that will be handled.

Also, assuming that ALL cases relating to a certain technology are more difficult that ALL cases relating to another technology is absurd.  A case with label of "mechanical" or "chemical" or "electronics" doesn't tell you how difficult that particular case will be; and certainly doesn't tell you how difficult or time consuming that case will be for a particular practitioner.

[10YearReg]

Where I work people with advanced technical backgrounds do get better compensation than those without the advanced technical backgrounds when the two have the same level of legal experience.   

But to the OP - reality check - the above-described situation, if it exists at all, it is an aberration.  Of the hundreds of firms with which I have been familiar, not one pays a dime more based on what happened before law school.

Maybe the author of the above quote would be so kind as to either:

1. Send a PM to you with his firm, so you can get higher pay there.
or
2. Post a list of major firms that have that system in place.

By the way, I have no issue with disparate reimbursement - I'd have preferred it along the way.

[stuffball]

"But to the OP - reality check - the above-described situation, if it exists at all, it is an aberration.  Of the hundreds of firms with which I have been familiar, not one pays a dime more based on what happened before law school."

One wonders where these hundreds of firms are and who would work for them.  It is standard practice to do what I'm describing.  Further, the notion that no firm "pays a dime more based on what happens before law school" is pure nonsense.  Nearly every firm I know of (haven't bothered to count) pays attorneys with prior experience according to that experience.  Most firms will hire a newly minted JD as a third-year associate if the JD worked as a patent agent prior to and/or during law school.  If you work for a firm that does not, I encourage you to contact your local recruiter.

It's probably true that only firms that are strong in IP offer more compensation to people with advanced technical backgrounds.  If you go to a firm where the IP group is ancillary or tertiary, it is likely that your technical expertise will be overlooked entirely.  I would recommend working for such a firm only if you can't find a spot in a firm that is solid in IP.

"Post a list of major firms that have that system in place."

I don't know that there is a "system." I do know from personal experience that at least 3 out of the vault top 5 in IP give higher compensation to people with:  1) strong technical backgrounds, 2) USPTO experience.

Vault Intellectual Property (2007)

RANK    FIRM
1          Fish & Richardson P.C.
2          Finnegan, Henderson, Farabow, Garrett & Dunne
3          Kirkland & Ellis
4          Morrison & Foerster LLP
5          Kenyon & Kenyon

[smgsmc]

Some follow-up:

(a)  I’ve been told by my boss and other attys that most law firms operate on the rule of thirds; that is, for the $$ that a client pays, ~one-third goes to the atty/agent who did the work, ~one-third goes to the partners, and ~one-third goes to overhead.  Now, if a firm has the same billing rate regardless of the technical difficulty of the case, how can an atty/agent with a more advanced technical background be compensated more than someone less technically adept (but having the same prosecution experience) unless the firm takes a smaller cut?  Does that happen?

(b)  A large chunk of business at my firm is flat rate with major corporate clients.  Here’s where the inequities become glaring.  Flat rate means flat rate, pure and simple...whether the case is rocket science or it’s not.   So what happens?  There are simple cases that any person in this firm can handle.  They get assigned to people with the weakest technical backgrounds; they don’t get assigned to me.  There are difficult cases that absolutely do require advanced technical knowledge (that is, some people here could not do them at all, even if you gave them several months to work on them).  They get assigned to me.  So instead of simple cases that I could knock off in ~25 hrs (for example), I get the hard cases that take ~50 hrs.  But they pay the same. 

[10YearReg]

Further, the notion that no firm "pays a dime more based on what happens before law school" is pure nonsense.  Nearly every firm I know of (haven't bothered to count) pays attorneys with prior experience according to that experience.  Most firms will hire a newly minted JD as a third-year associate if the JD worked as a patent agent prior to and/or during law school.  If you work for a firm that does not, I encourage you to contact your local recruiter.

How's life as an imaginary attorney going for you?  Remember, if you act out your fantasy that's a crime in all 50 states.

I like the way you try to muddy the waters by saying "and/or" during law school.  Nice deception.

You're out of your mind, and it's a disservice to everybody reading this board that you continue to post your delusional garbage.

To the extent that anybody decides to take a certain direction in life based on your incessant whining about "impressive technical background," you are personally responsible for the lies you tell here.  You are painting a false picture of reality, and to the extent some poor sap with a PhD decides to take the plunge based on your daydreams, you have royally deceived them.

I WORKED at one of the top 5 IP firms, you clown, and your imaginary system, I can assure you, was not in place.

These are "LAW" firms, not "advanced technical aptitude" firms.  If you're working at some 10 lawyer IP boutique, then the situation might be different.

I'm sorry you pissed away a half decade of your life pursuing a PhD that didn't pan out for you.  I'm sorry the PTO screwed you over.  STOP taking it out on the innocent people who come here for advice.

Major firms, like the ones you listed, do NOT advance you 2 years toward partnership because you were a USPTO examiner or patent agent prior to going to law school.

It is a complete fabrication.

IF you are an intern during law school, which means you have your reg number and you are attending law school, THEN most major firms will start you out as a 2nd or 3rd year associate.

But that's because you were billing 1300 or so hours per year for the firm doing legal work.

I don't know if there are internships outside of IP, but if there are, and people are billing 1300 hours while in law school, then I'd guess they get the same offer of advancement toward partnership.

There's no way any sizable firm is going to water down their associate ranks and partnership track by giving 2 years of advancement to some yahoo because he has a PhD.

Your PhD sucks and you'd be close to a half million in the black if you hadn't made the mistake of going to get a PhD instead of a law degree.  Get over it.

[stuffball]

10year,  you need some professional help.  Again, you've posted that your dozens of years experience at "hundreds of firms" supposedly netted you millions of dollars.  I love the bit on another thread in which you claim to end your average workday at 9am after have billed thousands of dollars over the course of two hours of frantic internet posting, LOL.  I urge you to use your riches to purchase Barbados, fly there on your firm's golden and jewel-encrusted jet and get some rest. 

In all seriousness, professional (or other) disappointment shouldn't make you so bitter.  Life is too short.  If you're unsatisfied with yourself, try to improve.  If you can't, accept where you are and try not to let it get you so down, angry and prone to over-reaction.

"I WORKED at one of the top 5 IP firms, you clown"

Which one and when did you work there?  Post or PM this if you expect to keep your credibility.  I'll bet you're actually some 7th year associate at a mid-level firm in suburban St. Louis.  You make around $90k and your PT Cruiser with customized, "PTNTGUY" vanity plates makes you the envy of the condominium complex.

[10YearReg]

10year, seriously, you need some professional help. 

I'm looking into it, but, you know, none of the shrinks have a "highly technical background," so I'm going to pass.

I'm solo now, as I've made clear, and if I post where I've worked, I might as well post my identity, which I'm not going to do, for 10 different reasons, which you and everybody else here knows.  Mostly, we all have clients to consider first.

Like I said, you're a pretender with an axe to grind.  I decided to post on this site to give back a slight bit, that's all - patent law has been extremely lucrative for me.  I'm retiring at age 40.  That says it all.  Maybe at the end of this year I'll post my reg number 4#,###.

Any advice I give here I give to try to help.  Why the hell are you posting?  To advance the cause of undervalued PhDs?

As an aside, my opinion is that it certainly would typically make more sense to pay a PhD in EE more than a BS in EE.  An even stronger case could be made in Bio, where the difference between a BS and PhD tends to be much greater than in most fields.

But that's not the way most of patent law works, despite anything you post.

[stuffball]

I'm relieved that you're looking into professional help.  With your millions, you should be able to afford the best.  I urge you to seek nothing less.

LOL that you won't post the name of a firm you don't even work for any more for fear of losing clients.  Go ahead and PM me the name.  I promise to keep it to myself, or at least not to tell your clients. 

And please do post your reg number.  We're all waiting with bated breath. 

[stuffball]

Still waiting on that PM, dude.  Let's have it.

Out of curiosity, if you made millions as a partner in one of the top 5 IP firms (as you claimed)... why are you now a freelance patent attorney? 

Did the firm throw you out for making them too much money?