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Morrison on Metrics: The ins and outs of patent costs

The distinctive ways in which law departments take control of fees.

One common way that metrics vary from one law department to another arises from their treatment of patent-related costs. Some law departments absorb the full cost of patent preparation and prosecution, as well as registration in foreign countries and the ensuing annual annuity fees paid to governments. Other departments revert to clients some portion along that continuum of costs. For example, some departments include the cost to obtain a patent in their legal budget, but thereafter clients pay for government fees and annuities. In between, the law department also picks up the costs of foreign patent agents as well as translation costs (which can often be considerable).

Another variation is that the law department will handle all patent work and expenses up to a certain number of patents in the year, but above that, a business unit needs to absorb some of the costs. A service level agreement is one way to lay this arrangement out. Another variation is to have the law department responsible for all patent-related costs in the home country, but for a business unit to pick up the tab for international filings and maintenance. For that matter, the legal department should charge the business unit the costs of patent litigation that arise from the business unit’s activities.

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Rees Morrison

Rees Morrison, Esq. is the founder of General Counsel Metrics, LLC. Based in Princeton, NJ, Rees has for the past 25 years consulted solely to...

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