Tuesday, May 26, 2009

Veteran Fish & Richardson Patent Litigator Educates General Counsel on Structured Fees - John Gartman Predicts Cost Savings, Greater Efficiencies, and Cultural Changes

Nationally recognized IP litigator John Gartman, a principal with Fish & Richardson, yesterday addressed the American Corporate Counsel - San Diego Chapter on the rewards of structured fee arrangements. According to Gartman, "Law firm clients are demanding new ways of addressing litigation fees…attorneys must realize that structured fee arrangements can produce tremendously positive results for both the client and the law firm."

(PRWEB) May 24, 2009 -- Nationally recognized IP litigator John Gartman, a principal with Fish & Richardson, yesterday addressed the American Corporate Counsel - San Diego Chapter on the rewards of structured fee arrangements. According to Gartman, "Law firm clients are demanding new ways of addressing litigation fees…attorneys must realize that structured fee arrangements can produce tremendously positive results for both the client and the law firm."

Structured fee arrangements are arrangements in which a client and a law firm agree upon a fixed price for services versus the law firm billing the client at an hourly rate, which is currently the industry standard. While such arrangements have been utilized for transactional legal services, very few firms have adopted structured fees for litigation.

A highly respected and experienced trial lawyer, Gartman's national trial practice focuses on high technology litigation. He has deep experience in telecommunications, semiconductors, software, and sports equipment. For several years, Gartman served on his firm's management committee and he founded Fish & Richardson's San Diego office.

Gartman began the presentation with highlights of the American Corporate Counsel's survey of chief legal officers (CLO), which found a strong disconnect between the desire of CLOs to have structured arrangements with their law firms and the number that actually had in place such agreements. The survey also found that general counsel believed that structured arrangements would improve relationships with law firms but that some surveyed were skeptical that fixed fee billing could be integrated.

Throughout his detailed presentation, Gartman cited examples of how Fish & Richardson has successfully utilized fixed fees in litigation and encouraged the general counsels in the audience to explore similar arrangements with their law firms.

"Litigators say it's too complicated (to establish fixed fees) and have a long list of reasons why they can't do it,' states Gartman. "With a little education and creativity, there is no reason not to do it."

Gartman debunked several myths regarding structured fee arrangements including the common myth that lawyers working under fixed fees won't work as hard. Gartman advised the audience that "counter balances can be added to the agreement to insure that lawyers are economically incentivized to work just as hard if not harder on a fixed fee case."

Gartman provided examples of how performance bonuses can be included in fixed fee agreements as an incentive for attorneys to work quickly and efficiently and to generate winning results. Such bonuses could reward law firms for early settlement and favorable motions for summary judgment, as well as for trial wins. Gartman noted that the amount of the bonus should be based on multiple factors including the pending exposure to the client if the litigation is not successful, the type of case, and the geographic location of where the case will be tried.

The hour-long presentation included an overview of the various types of fixed fee structures available to clients including monthly fixed fees, staggered fees, fees paid during certain phases of the litigation process, and a combination of fixed fees for pre-trial work and an hourly rate at trial.

In additional to fixed fees being extremely beneficial to clients, Gartman noted several positive consequences to law firms as the byproduct of such agreements, including investment in software and workflow optimization that will increase efficiencies in the way trials are managed and costs are tracked. Gartman also believes that structured fees will make law firms more strategic in approaching litigation and will put an end to "aimless and sloppy delegation" of work product.

He predicts that there will be a shift in the structure of law firm staffing with more firms moving away from pyramid shaped staffing models toward diamond shaped models. "With senior lawyers making quicker and better decisions, less work will be pushed down to lower levels." When asked how this affects law firm hiring, Gartman noted that, perhaps counter-intuitively, law firms will "build the diamond over time by hiring a pyramid each year. Some attorneys will rise to a certain level and then tapper off, so the way law firms currently hire won't necessarily be affected."

Lastly, Gartman foresees a "cultural redo" as the legal industry moves toward fixed fee structures. "The focus will be on efficiency and organization. Law firms will still make money while driving down client costs. There is a huge opportunity for a win-win."

About John Gartman
John Garman, a principal at Fish & Richardson, was named by IP Worldwide as one of the nation's "Magnificent 7" and one of the "Best Young Trial Lawyers" in intellectual property in 2002. Gartman has been voted by peer-review into the 2006, 2007, and 2008 editions of The Best Lawyers in America. The Daily Journal has repeatedly named him one of California's "Top 25 IP Lawyers," and since 2003, Chambers USA has named him one of the "Leaders in Their Field," citing him as one of the leading lawyers in the United States. He was also named one of the Top 75 intellectual property litigators in California of 2009 by the Daily Journal. He has been recognized by the National Law Journal as being on the 2008 "Appellate Hot List"

About Fish & Richardson
Fish & Richardson is a leading global law firm practicing in the areas of intellectual property, litigation, and corporate law. With 500 attorneys and technology specialists in 11 offices in the United States, and an office in Germany, the firm is unlike any other law firm in the world. Fish has redefined IP law for a market that values IP as a fundamental business asset. Fish's elite legal team combines corporate, technical, and legal expertise to help clients maximize the value of their IP. Surveys show that Fish is the largest IP practice in the United States (Managing Intellectual Property, October 2008), handles more patent litigation than any other law firm, both in federal district courts (IP Law & Business, July 2008), and the International Trade Commission (IP Law & Business, June 2008), and is the #1 patent firm for the world's most innovative companies (IP Law & Business, November 2008).

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