Changes to patent law bring new business for D.C. intellectual property firm

The America Invents Act has been good to Sterne Kessler Goldstein & Fox, the 130-attorney law firm whose first and only office is in downtown Washington.

Sterne Kessler’s only business is intellectual property — the firm represents companies and inventors in copyright, trademark and patent law matters — so changes to the U.S. patent system that were made in the wake of the 2011 law are being felt much more dramatically at Sterne Kessler than at full-service corporate law firms that do legal work across all fields.

The America Invents Act made a number of changes to the U.S. patent system, including putting into place a new process for challenging the validity patents before the U.S. Patent and Trademark Office. That change in particular is bringing in new work, said Sterne Kessler’s managing director Mike Ray.

The proceedings are similar to patent litigation brought before the courts, but the process is typically less expensive than going to court because there is less discovery — the exchange of documents and other information between the feuding parties. While litigating a patent case in court could cost a company between $2 million and $3 million, challenging the validity of a patent before the patent office costs between $250,000 and $750,000, Ray said.

“This is changing the landscape of patent litigation,” Ray said. “This is one of the biggest opportunities for our firm. Our expertise is the patent office. That’s not the case for many general practice firms.”

Mike Ray, managing director of Sterne Kessler. (Sterne Kessler/Sterne Kessler)

Since Sept. 16, 2012, the first day that companies and individuals could start filing challenges to patents in the new proceedings, 1,211 such cases have poured in. Sterne Kessler is legal counsel for about 10 percent of those filings, or 117 cases.

The firm represents both sides in such matters — the patent owners as well as the people, companies or other parties that are challenging the patents. Sterne Kessler is constantly trading places with other intellectual property law firms such as Fish & Richardson, Finnegan and Oblon Spivak McClelland Maier & Neustadt for being the firm handling the most cases before the patent office.

Sterne Kessler was founded in 1978 as a patent prosecution firm, which meant the firm’s lawyers were primarily representing inventors when they wanted to file applications for their patents. Over the last decade, however, patent litigation has been growing steadily as a source of revenue for the firm. In 2009 and 2010, when many full-service law firms were laying off lawyers, Sterne Kessler managed to avoid those cutbacks, Ray said.

Now with patent law becoming more mainstream, specialty law firms like Sterne Kessler are in the spotlight. So far this year, the firm has hired six attorneys, three technical specialists — engineers and scientists that the firm trains and helps put through law school — and one patent agent. Patent agents are non-lawyers who can practice before the patent office. And at a time most large law firms in Washington are shrinking their real estate footprint, Sterne Kessler is growing. In 2011, the firm renewed its lease for another 10 years to stay in its office at 1100 New York Ave., and took on about 40 percent more space in terms of square feet.

“Ten years ago, people said specialty firms were dead,” Ray said. “All these changes [with America Invents Act] have created big opportunities for us. There’s never been a better time to be a specialty firm.”

Catherine Ho covers lobbying at The Washington Post. She previously worked at the LA Daily Journal, the Los Angeles Times, the Detroit Free Press, the Wichita Eagle and the San Mateo County Times.

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