The IP Legal Landscape In 2010

Monday, February 1, 2010 - 00:00

Editor: How did Fish & Richardson handle the challenges of the 2009 legal market?

Devlin: To face the unique challenges presented by the recession, we made a strategic decision to focus on investing in our core practice areas. For Fish, that means focusing on what we do best: IP strategy and counseling, IP litigation, and business litigation. We are very fortunate to occupy the pinnacle of the IP world, and we intend to stay here for a long time. Our clients tell us that it is the depth and breadth of our technical expertise, combined with our industry knowledge, that makes us their first choice for IP and for business litigation.

All of our business decisions focus on maintaining the quality, breadth, depth, and dominance of our core practices. The IP and business litigation practice areas are both intensively competitive, so staying #1 requires our constant effort to make ourselves better. Focusing on our core practices was the right decision for us, and resulted in a solid year for us financially. The firm was profitable and we are positioned for a strong 2010.

Editor: What do you think the IP legal landscape is going to look like in 2010?

Devlin: With the size, scope, and position of Fish's practice, we are a bellwether for what is happening generally in the IP landscape. We see many positive signs so far in this recovery.

By the end of 2009, our Litigation Group had filed appearances in 171 new cases in federal district courts, including 117 new patent cases. We also filed 42 patent cases in the Eastern District of Texas, a popular jurisdiction for patent cases and where Fish is number one among national firms practicing in that court. We also have a robust record at the International Trade Commission (ITC), where we have won five cases in the last two years and are involved in 25 percent of all active cases.

As frequently is the case when the economy hits a rough patch, business and white collar criminal litigation were hot practice areas for us in 2009. We were particularly busy with trade secret, white collar, class action, antitrust, and Chancery cases. We won one of the largest state court verdicts in Texas last year, a $178.7 million verdict for minority shareholders of an NL Industries, Inc. subsidiary, who alleged that a pattern of misconduct deprived them of the true value of their investment. We also won dismissal of SEC insider-trading allegations that had been brought against Dallas Mavericks owner Mark Cuban in a closely watched case.

Among patent cases, we are beginning to see an uptick in competitor-to-competitor patent cases, meaning those cases where two companies who make and sell competing products are engaged in patent disputes. These cases differ from non practicing entity (NPE) cases, in which a patent owner who does not make or sell its patented product sues all or most of the players in a particular industry for patent infringement. During the economic downturn, competitor-to-competitor cases had declined as companies put the brakes on litigation. That's starting to change. Now we see companies are cautiously moving forward to defend their competitive advantage by protecting their valuable IP through litigation.

One huge growth area for us is pharmaceutical/biotech IP cases. Over the past two years, we have handled 14 new patent cases based on Abbreviated New Drug Applications (ANDA), in which branded pharmaceutical companies who sell patented drugs are pitted against generics seeking to enter the market. In 2009 alone, Fish filed nine new ANDA cases. These cases are quite large and very complex, and they are well suited to our firm's broad based technical expertise. In 2009 we won a major ANDA case for our client Allergan that will keep two of its competitors out of the $240 million market for a glaucoma drug for 12 more years. The media noted that the ruling is worth a few billion dollars to our client.

We have been particularly busy doing patent reexaminations as more and more clients look to use reexamination as a strategic defensive weapon in high-stakes patent litigation. We filed almost one quarter of all inter partes reexaminations that were filed in 2009. This will definitely continue to be a hot growth area for us in 2010.

Activity in prosecution and litigation involving trademarks and copyrights is slowly rising. In 2009, we filed appearances in 23 new federal trademark and copyright cases, in addition to filing 47 oppositions, cancellations, and appeals before the Trademark Trial and Appeal Board.

We are also seeing an increase in demand for some of the new services we have created to fill clients' unique needs. For example, recent case law has clarified the prospect of personal liability for corporate directors and officers who do not adequately fulfill their duty to oversee the management of the corporation's intangible assets. Fish has created a program, called RISC/return, to help corporate managers implement best practices that can increase the return on the company's R&D investment, while minimizing the risk of catastrophic liability for the corporation and its managers when something goes wrong.

These are some of the healthy trends developing right now. Intellectual property is a fundamental business asset. As the economy recovers, so will demand for the type of sophisticated IP strategies that Fish provides. We anticipate that the increase in the demand for IP legal services will be steady, but slow. The curve isn't going to look like a ski jump, but rather a slope curving gently upward.

Editor: How have client's IP needs changed and how are you responding to that?

Devlin: The recession has squeezed budgets and taken a bite out of demand for legal services. At the same time, because revenues are down, clients want to maximize the return on the investments they have already made in their IP.

To help clients cut costs, Fish has been pro-active in offering clients fixed and other alternative fees. Managing and billing our work this way is a major change but an investment in our clients and our future. We are constantly evaluating our already lean staffing structure to make sure that matters are staffed efficiently, and monitoring our work even more closely to find additional opportunities for savings. Our goal is to deliver the highest quality services to clients at a cost that is an outstanding value.

To help clients manage through the recession, we have provided them with strategic advice on how to maximize the value of their IP, whether through licensing and enforcement programs, or triaging their legal work to allocate spending to those parts of their IP portfolio that are essential to their business. Throughout the recession, as always, we have been in constant communication with our clients so that we can respond to, and sometimes anticipate, their changing needs.

Editor: How have you responded to client pressures to reduce the amount spent on legal work?

Devlin: Fish strives to be a leader in fee arrangements that offer a real alternative to the billable hour. For some time, we have been offering fixed fees. To do this, we have invested time and effort to develop tools that help us analyze the resources needed to pursue cost-effective, winning strategies in past patent litigation. As a result of that analysis, we can offer our clients a fixed fee that provides both predictable billing and high-quality, winning representation.

We are more closely managing workflow and using more technology to produce the same high quality work on which we have built our reputation, at a fixed cost. We are also developing highly skilled non-lawyer staff who specialize in specific aspects of our work who can produce quality work at a lower cost. This has produced good results for our clients and us.

Editor: What will Fish & Richardson look like five years from now?

Devlin: Fish proudly occupies the top of the IP world, and our overall strategy is to stay where we are: the #1 IP firm globally. We were recently honored as a finalist for "IP Litigation Department of the Year" by The American Lawyer and as one of the "Top IP Firms of the Year" by Law360 . We were the only law firm to appear on both lists. We do more patent litigation than any other firm, and are number one in the world in Patent Cooperation Treaty (PCT) applications, and are the only IP firm to appear on a National Law Journal list of top appellate practices. We are one of the most sought-after firms for both patent prosecution and patent litigation services among Fortune100 companies.

Fish enjoys many long-term relationships with our clients that have only become stronger as we've navigated this unprecedented downturn together. Our clients include large companies who are innovators, like 3M Company, Boston Scientific, Bose, Microsoft Corporation, and Target Corporation; biotech and pharmaceutical companies like Allergan and Biogen Idec; academic and research institutions like Mass General and the Mayo Clinic; and smaller companies, like Perceptive Pixel.

Our long-term plan is to continue to do what we do best: focus on our core strengths - IP strategy and counseling, IP litigation, and business litigation - and continue to grow and expand those practice groups. We have a long tradition of conservative management, which is a competitive advantage during times of economic stress. We are well positioned to thrive in today's current environment, over the next five years, and beyond.

Please email the interviewee at devlin@fr.com with questions about this interview.