In defense of contingency fee agreements

In defense of contingency fee agreements

 

In view of the escalating costs of patent proceedings, contingency fee agreements can be seen as improving the access of “little ones” to the court system - one thinks of the small inventors and those who would not otherwise have the resources. means of defending their intellectual property rights against companies with greater resources.

 

But as with other types of complex commercial litigation, performance fee agreements relating to patent litigation are not the exclusive preserve of small inventors and individuals. They can be just as attractive to larger and more wealthy litigants looking to control their litigation costs - their risk spreading effect of patent litigation is the same for all clients, large and small. Outcome-based lawyers occupy a position analogous to that of a business partner or venture capitalist - an investment model that certainly encourages looking at cases more carefully and keeping costs down. of procedure.

 

In contrast, traditional hourly billing conventions mean that almost all of the risk of litigation is borne by the customer. This obviously creates a concern for small inventors and other potential litigants with limited liquidity, to whom the high cost of patent proceedings can literally shut the door of the court system. And if the need to dilute the risks of litigation is not necessarily imperative for those who have substantial means, the fact remains that controlling the cost of legal services is a growing concern. According to a recent survey by the Association of Corporate Counsel and The American Lawyer magazine , 39% of corporate lawyers made more extensive use of alternative billing methods with outside law firms during the year elapsed. In addition, it turns out that in almost all cases the initiative for changes to hourly billing systems came from corporate legal departments, not from outside law firms.