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Author Topic: Patent Agent association with referral attorneys  (Read 665 times)

LF

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Patent Agent association with referral attorneys
« on: 05-01-18 at 12:26 pm »

Jim et al:

I have a question for the other solo practitioners here, especially for fellow Patent Agents. Every so often, Trademark attorneys ask me about being their ‘patent guy’ (they feel safe in that I won’t take their TM clients ‘away’). Having built my practice over the past 12+ years, I am not quite interested of being ‘of counsel’ and/or joining with anyone (Once you have 80+ issued/allowed patents for clients, you start figuring you have ‘just a clue’ of what goes on).

I think my choices are…

#1 Finder’s fee. I think under the AIPLA ethics rules I can pay that to attorneys or non-profits, but not to ‘just anyone’? (Anyone have a clear idea? And/or if I am wrong? Please let me know). Is 10% of what I billed ok? Or is 20% customary?

#2 I’d let them bill me out at X an hour on their firm, pay me Y? Y being less than X. Saves me on the billing, and they can charge a retainer. This sounds like being ‘of counsel’, not sure I like it. I think being a subcontractor is ok on my insurance, but will check with them separately.

#3 (Preferred by me), would instead prefer to pay them a ‘rebate’ on my hours worked to their client (when/if I get paid). So, I bill at whatever I do per hour an amount Z (less fees etc.), then send the person a check for 10 to 20% of X? My question goes to the AIPLA rule about this. Is keeping the amount of the rebate from the Customer ok?

Needless to say, I don’t want to either have to chat to OED on this or be a topic of Gene Quinn’s CLE hour on ethics at the PLI!!!

LuF

As always, a deep level of gratitude and appreciation to this forum. Y'all helped me back in '05 to pass the exam, and now as I come onto my 14th year of doing this, AM very glad to have taken an 'alternate' path. As an older novice NOT one Boston area law firm even gave me an interview. But in time, I've gotten an allowance on an application filed by them for at least one FORMER client of theirs. Yeah, it felt good.
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still_learnin

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Re: Patent Agent association with referral attorneys
« Reply #1 on: 05-01-18 at 01:10 pm »

I have a question for the other solo practitioners here, especially for fellow Patent Agents.

So you are an agent, not an attorney.

Every so often, Trademark attorneys ask me about being their ‘patent guy’ (they feel safe in that I won’t take their TM clients ‘away’). Having built my practice over the past 12+ years, I am not quite interested of being ‘of counsel’ and/or joining with anyone ...

I think my choices are…
...

All involve a monetary "reward" to the referring attorney, just structured in different ways, right? Are you sure that's necessary or expected? Have the trademark attorneys you speak of suggested this - either in general, or a specific arrangement?

I know many patent attorneys who routinely get referrals from "small business" attorneys, and (AFAIK) there's never a monetary incentive. Attorneys routinely refer work to each other because it benefits both sides.

I also know several patent agents who get overflow patent work from other patent attorneys. And yes, in those cases, the "sourcing" firm/attorney gets money. Sometimes solely for being the source of the work. Sometimes for also providing other services to the agent, e.g. invoicing.

I think your scenario -- trademark attorney referring to patent agent -- is more like the former than the latter. 

#2 I’d let them bill me out at X an hour on their firm, pay me Y? Y being less than X. Saves me on the billing, and they can charge a retainer. This sounds like being ‘of counsel’, not sure I like it.

So "bill ... on their firm" means the sourcing firm bills the client, and pays you? As opposed to you billing the client for the patent work you do.

In my mind, "of counsel" is not a payment arrangement. Instead, it implies a recognition by the "firm" that the "of counsel" is associated with the firm. The of-counsel holds himself out to be a part of the firm. The of-counsel is listed on the firm's website, letterhead (still a thing?), shares office space, admin, etc. I think "hold himself out to be part of the firm" implies that the of-counsel is on the firm's malpractice policy too, but I might be wrong about that.

Everything else about of-counsel can and does vary widely between firms: payment arrangements (billed, collected, percentage, draw); benefits (health insurance, retirement plan, etc.); who pays bar dues; who pays CLE; whether firm marketing money is available to of-counsel.
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The above is not legal advice, and my participation in discussions on this forum does not create an attorney-client relationship.

LF

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Re: Patent Agent association with referral attorneys
« Reply #2 on: 05-02-18 at 08:22 am »

First and foremost, thank you Still_.

Below what a good friend and Patent Attorney replied, which I've sanitized to keep him Anon. Needless to say, it is not legal advise (from me, or from him), just good practice advise, particularly for us prosecutors. In the spirit of so much here, advise so we can all protect our clients to the utmost...

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With respect to a finders fee, that is dicey. That is exactly where you don't want to be. Paying a referral fee is not OK. They have to do something to earn their share. Do they have an office in which you will work? Perhaps they let you use their firm location to meet with their clients? Perhaps they do no-patent stuff for you, like chase the client for signatures, to review things prior to filing, stuff that you might have a secretary or paralegal do for you. So that is how you justify paying them a portion of the fee. I think that works, but a straight up referral fee where they do nothing and provide nothing wouldn't work.
 
And the client not knowing anything about it is also a kiss of death. You definitely want the client to know what is going on. If something goes wrong that will be the thread that OED pulls and they hate it when there isn't an informed client.

I'd just have it in writing that you are on your own and not of-counsel. Have it in the agreement the client signs that you are not a member of the Trademark firm, but that the trademark firm will provide logistical, administrative and clerical support of a non-patent nature to facilitate in the representation. And since you aren't a lawyer it would be easy probably because along the way they could "give advice" about how this fits into the client's overall legal/business strategy.
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