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Starting an IP practice

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Forming an intellectual property firm can be more expensive than starting a firm in another area of law, and those costs may not be obvious if the attorney has only worked at a larger firm before hanging out a shingle. Expenses unique to the IP practice include a specialized bar exam, finding a docketing system to specifically track patent applications, and navigating the nuances of professional liability insurance that has a unique IP focus based on the risk of that kind of legal work.

15col-reichel.jpg Indianapolis lawyer Mark Reichel saw some unique challenges in starting his own firm, including finding an IP-specific docket. (IL Photo/ Perry Reichanadter)

“In general, it is very hard to start a new practice from scratch, but it’s even more difficult when you are focused on something IP,” said Indianapolis attorney Mark Reichel, who started his own practice late last year after leaving Ice Miller. “There is a fairly steep learning curve with respect to patent preparation and prosecution. Most practitioners learn the details from taking a patent bar prep course, and those who do not take a course learn by some fairly time-intensive self-study.”

To start his firm, Reichel needed to set up a unique customer number with the United States Patent and Trademark Office and create a retainer account with that office in order to pay filing fees and other costs. He also had to ensure his personal information in the agency’s database was updated, because it is not tied to the USPTO’s formal roll of attorneys and agents.

One task he didn’t anticipate would be such a challenge was finding a suitable docket for IP matters. He had partial access to one through Ice Miller but when he went out on his own he had to identify more comprehensive docket system at a reasonable cost. Instead of plugging into an existing system, he needed additional user licenses from the provider that would allow him to not only read materials, but also enter data. Reichel found the systems are expensive: the cheapest he’s been able to find starts at $100 a month for an online system, and a single-user full license system costs at least $1,600 to handle patent, trademark and copyright file information.

Reichel and other patent attorneys say that obtaining professional liability insurance was trickier than it might be for other practitioners. An IP-unique multi-page “rider” is attached to the insurance application and includes a breakdown of risk percentages for patent, trademark and copyright work as well as several questions on each area. The risk is higher for these attorneys as compared to other practice areas such as criminal law because IP law isn’t as settled as to what may be patented or copyrighted. Plus, litigation of IP areas can last longer than other areas of law, meaning

clients may spend more on their legal claims and end up dissatisfied with their attorney if they don’t like the case outcome.

“Liability insurance as an upstart is more expensive, since insurance companies are leery because you don’t have an established process,” said Paul Maginot, founding partner of what is now the 15-person firm of Maginot Moore & Beck. “As a new person getting into this, you don’t understand those hidden costs.”

Maginot worked in private practice and as a corporate patent attorney before starting his own solo practice in Indianapolis. Like other patent attorneys, Maginot faced difficulties in finding an affordable docketing system, which he’s found can run $30,000 or more per year depending on the system. He said attorneys sometimes can negotiate those prices and it’s often better to start off small and upgrade as a client base grows.

“I had challenges, but they weren’t insurmountable and these issues aren’t too great once you get established in this area of law,” he said.

Small or solo practices don’t always endure.

That’s what lawyer Cedric D’Hue found after leaving Baker & Daniels to start his own IP firm in 2009. He left because the economic downturn meant there wasn’t enough work to justify him being there.

D’Hue zeroed in on the Lafayette area because of Purdue University and the large amount of engineer-related matters there. Soon enough, he took on Purdue Research Foundation as a client.

“My breakout was moving to that area with such a narrow focus,” he said. “In Indianapolis, I was one of several hundred patent and IP attorneys competing for the same clients. But in Lafayette, there’s an undersupply of local patent attorneys because it’s just close enough to Indy, but far enough where the attorneys have to commute.”

Finding clients in the IP area is more difficult, he said. You can’t advertise in general newspapers because potential clients are highly specialized and not flooding the market like those who might be searching for a criminal defense lawyer. Finding a geographic area where your name gets out can be one of the best things to do. He said IP clients communicate with each other and learned his name. D’Hue also suggested IP attorneys with their own firms attend networking events to meet other attorneys and potential clients.

After two-and-a-half years on his own, D’Hue said his big client, Purdue Research Foundation, connected him with Bingham Greenebaum Doll and persuaded him to go back to a larger firm where he’d be with other lawyers focused on engineering, science and IP law.

“Basically, it comes down to wondering what happens for them if one day I got hit by a bus,” he said. “This was a great connection with Bingham, and that’s worked out. I loved having my own firm, and it was tough at first, but in the end it was about doing what was best for my client.”

D’Hue has lectured at law schools on starting an IP firm, and he said the expertise gained from a big firm before starting his own practice is what helped him succeed.

One tip he’s offered is finding computer software to install on a laptop or desktop where you pay a couple thousand dollars up front but don’t have to worry about accruing monthly charges that add up to more over time.

“It’s not easy, especially for someone who’s coming out with a lot of student loan debt and needs a place to eat and stay,” he said, adding that attorneys who want to start a firm can make it happen if they understand the risks and issues they’ll face. “It can be done if you do it right.”•
 

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  1. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  2. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  3. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  4. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  5. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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