What do the following have in common? (a) missing deadlines;
(b) unethical business practice or activities; (c) failing to
deliver services on terms agreed; (d) little or no transparency
in billing and costs; and (e) failing to manage costs. The
answer is that these were identified as the main reasons for a
breakdown in a relationship with an outside adviser by the
1,200 in-house practitioners surveyed in IP STARS annual
Normally clients are the ultimate decision makers on the
steps taken by their external IP adviser or agent. Those doing
filing and prosecution work may well be reassured that only 33%
of respondents strongly agreed that obtaining an IP right with
little value can affect the relationship. But litigators should
seriously consider alternative dispute settlement options such
as mediation and negotiation, as 55% strongly agree this can
affect a relationship.
On the flip side, the majority
disagree that lack of social interaction with in-house counsel
(23%) and cultural differences (20%) affect a client
relationship. Most firms socialise and interact with their
clients in different ways to nurture relationships, and will
surely continue to do so, but should note that only 19%
strongly agreed that this helps and 59% are neutral.
To complement this question we asked in-house counsel to
tell us what would make them terminate the services of an
external IP adviser or agent (see box). Again, issues around
costs and billing feature heavily in the comments, so were
conflict of interest, insufficient communication and loss of
key contacts or partners.
In a competitive market, and one where clients are demanding
more for their money, external advisers must continue to
demonstrate exceptional client care to minimise the risk of
client relationship breakdown, deliver results at reasonable
costs and add value in order to differentiate themselves. All
of this culminates in a positive, demonstrable reputation which
can be used to win new work.
Ending relationship – the comments
• "Abusive billing practices or
subject matter incompetency."
• "Excessive delays in communicating.
Overcharging fees or repeated errors in billing."
• "Ethically slippery."
• "[Not respecting] matters addressed
in our business Code of Conduct that we expect of ourselves and
our business partners."
• "If because of their advice the
situation ends up being more expensive than settlement in the
• "Poor conflicts protocol."
• "Failing to give feedback and
information on the progress of work."
• "Loss of key contact or significant
change in team."
• "No longer adding value."
• "Failure to take responsibility for
and proactively communicate a mistake."
• "Not listening or respecting our
• "Disappointing results."
• "Forwarding cases to another person
in the firm without informing client."
• "Lack of cooperation and help with
options to manage costs, for example insisting on sending hard
copies of correspondence at extra expense when we have asked
only to receive emails."
Billing – the comments
• "Fixed monthly fee for standard
work is great" (General counsel in an entertainment company in
• "I do like fixed rates for
pre-litigation tasks such as cease and desist letters"
(Attorney in a food industry company based in the US)
• "Fixed fee for routine work and
hourly fee for tricky issues including complex applications and
prosecution" (Head of IP in an automotive industry company
based in France)
• "Hourly billing is more clear to
see the time spent on each topic" (CEO of a technology company
based in Sweden)
• "Hourly billing subject to prior
estimates and regular updates" (General counsel in a financial
service industry company based in the US)
• "Where fixed fee is not available,
we prefer cost transparency by quote and cost reporting"
(Senior legal counsel in a technology company based in
• "Will love to work with a firm who
are flexible on capped fee arrangement or other models like
contingency fee" (Vice president of IP in a pharmaceutical
company based in India)
• "With respect to filing
applications and dealing with intermediate work during
examination, a fixed-fee system is desirable. With respect to
lawsuits and proposal for countermeasures against illegal
copies, a fixed-fee system is also desirable, but hourly
billing is acceptable depending on circumstances" (IP manager
in an engineering company based in Japan)
What in-house counsel want
Also read the
first part of this article which revealed what
in-house counsel care about the most when selecting external IP
advisers or agents.