For some matters, a traditional hourly billing model fits the needs of our clients. We offer the hourly billing arrangement at rates that are fair and commensurate with our experience and ability. For many matters involving intellectual property disputes, however, alternative billing arrangements offer many benefits to clients. No matter what billing arrangement is best for our clients, we approach each case with the same efficient result-driven approach to do what is necessary to win the case.
Listed below are some of the alternative billing models that we have successfully used for both plaintiffs and defendants. We are willing to discuss these and any other alternative billing arrangements that fairly allocate the reward and risk between our firm and our clients.
Contingent Fee Representation
Under this arrangement, we receive a fixed percentage of recoveries or other benefits received by the client in connection with our representation instead of getting paid on an hourly billing basis. Most of our clients pay out-of-pocket litigation expenses under contingent fee or other alternative fee arrangements. Because these expenses can be significant in some cases, we have worked with our clients on modifications of the arrangements on the cost components or assisted them on third-party financing of these litigation expenses.
Fixed Fee Representation
Litigation, by its very nature, is unpredictable and risky. Litigation also goes through numerous phases before the final resolution, which leads to sharp increases or decreases in monthly hourly billings. Fixed fees are designed to provide predictability in cash flow for the client and impose accountability on the lawyer so that unnecessary work is not done for the sake of doing the work and, of course, generating billable hourly fees. At the outset of each matter, we learn about the client’s business, objectives, cash flow considerations and expectations to tailor the terms to fit the client’s needs and interests. Under typical fixed fee arrangements, our firm would agree to handle a matter for a fixed amount of fees paid upfront or, often, on a monthly or quarterly basis. We have also handled a fixed fee matter by combining the traditional hourly billing arrangement with a monthly or quarterly cap on our fees so that the client can properly budget litigation expenses and forecast quarterly or annual earnings for the company.
Hybrid Fee Representation
Under a hybrid or partial-contingent fee arrangement, we receive a reduced fixed fee or a portion of our hourly fee with a smaller contingent fee percentage. This billing arrangement offers the most flexibility for the client and our firm to tailor our fee arrangement to suit the client’s business needs and interests. It reduces the risks to the lawyer and client and provides the client with a larger portion of recoveries while maintaining the alignment of the interests of the lawyer and the client.
Result-Based Incentive Fee Representation
This arrangement is based on “success” or “incentive” fees being triggered upon favorable outcomes at pre-determined milestones. This approach is typically combined with lowered hourly billing or fixed fee arrangements. For example, this arrangement can be used for trademark cases where obtaining or defeating a motion for preliminary injunction alters the trajectory of the lawsuit. Our firm will be paid a reduced hourly or fixed fee for our work with “success” or “incentive” bonus fees paid based on the outcome of certain milestones such as obtaining (for plaintiff) or defeating (for defendant) a preliminary injunction motion. This can also be used in patent cases in district court lawsuits and before the Patent Trial and Appeal Board where the local patent or agency rules provide built-in milestones.
Reverse Contingent Fee Arrangement
This is a contingent fee arrangement for defense clients. Under this arrangement, our fee is based on a percentage of the reduction of the total exposure to the client in a lawsuit. We analyze and agree with our client on the likely exposure that the client may face in the lawsuit, including the costs of defense. The reverse contingent fee is a percentage of the difference between the total likely exposure and the total litigation expenses for the client. Like other alternative fee arrangements, the reverse contingent fee can be combined with other arrangements to suit the client’s needs.
We have extensive experience with litigation financing companies as a result of our litigation success in prior matters. These entities, while different in their approach or focus, generally provide funding for litigation expenses using the litigation claims as assets. Some of them also offer a way to moderate the post-trial risks after successful trial outcomes by providing capital to the client during post-trial motion practice or, more often, on appeal. Our experience and relationship with these funding entities have proven to be a valuable asset to our clients. As an early adopter and a leader in crafting and negotiating alternative billing arrangements, we have worked with most of the leading litigation financing companies in the world to negotiate and structure deals with them on behalf of our clients. Our past success provides credibility to our clients for future matters that may be presented to litigation funding companies. Litigation financing comes at a price for the client and may not be suitable for all clients or matters. But, for certain cases, access to third party litigation finance capital can be invaluable no matter the size or financial condition of our clients. It can provide the “staying power” necessary for small-cap companies embroiled in protracted and expensive litigation. Even for the biggest corporate clients, litigation financing provides liquidity, cash flow stability and predictability.