Biglaw, Boutique Law Firms, Intellectual Property, Litigators, Patents, Small Law Firms

Beyond Biglaw: Biglaw's Eroding Edge (Part 1)

Are large firms losing their advantage over small firms in the area of knowledge management?

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The experience of leaving a Biglaw partnership to start a boutique law firm did not allow me to stop thinking about Biglaw. If anything, I think about Biglaw now more than ever. Because the very nesting grounds that I flew away from, IP litigation departments at national and international law firms, are some of my upstart boutique’s biggest competition for new business. And considering our experience with the first five or so cases that our firm has brought, our adversaries as well. Of course, I continue to work with Biglaw firms as co-counsel on some cases as well.

So I think about Biglaw. How it works, and most often how it fights patent cases. For over a decade I was a Biglaw-branded pugilist, and now that I am on the other side of the ring, I am forced to respect but try and beat the Mike Tyson’s Punchout-worthy cast of characters that Biglaw rolls out on behalf of its clients. There are not many Glass Joe’s in the bunch. Which makes it fun.

I would not have left unless I thought that my partners and I would be competitive — both with Biglaw and with the many quality IP boutiques that have come before us and continue to thrive. But as I think back on how IP litigation practice has changed just in the short amount of time that I have been practicing, I take comfort in the fact that the playing field between Biglaw and boutiques has been leveled across a number of fronts. Two areas in particular deserve focus….

The first is knowledge management, the topic of this week’s column. The second is in marketing reach, a topic for another day. The democratization, through technology, of each of those areas has contributed to an unprecedented erosion of Biglaw’s edge over smaller firms. At least in certain key practice areas. Like patent litigation. One bit of proof is the fact that how I practice has not needed to change at all in the past five months. The resources I have access to now are the exact resources I used most often when I was a Biglaw partner. That would not be possible in the “paper world” of even fifteen years ago.

Patent litigation is an interesting area to focus on when trying to consider how freer access to information allows smaller firms to compete with Biglaw and even much larger boutiques. On the one hand, it is a quintessential Biglaw practice area. In fact, most Biglaw firms hold their patent litigation practices in high esteem. Maybe a tier below a heavy-hitting corporate practice group, but still up there in the internal estimation. As with other “prestige practices,” patent litigation offers Biglaw firms the (1) security of a high barrier to entry (the whole technical degree for patent lawyers issue, for example); (2) profit potential of large cases requiring scale and reach; (3) deep pockets of a corporate client base; and (4) prestige of a federal court-driven practice.

On the other hand, patent litigation has proven to be one of the most competitive areas for Biglaw firms, particularly on the singularly important metric of profitability — as in the ability to command premium rates. Contrary to the increased Madison Avenue-feel of many prestigious Biglaw corporate practices, the declining ability of patent litigation groups at many Biglaw firms to avoid heavily discounting to attract and maintain work has given the practice the feel of a rough-and-tumble parking lot flea market. A few years ago, I saw a statistic that showed that the two Biglaw practice groups that were undergoing the most pricing pressure were patent litigation and employment litigation. The democratization of access to Biglaw work product is a big reason why.

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A few years ago, one of the better arguments for the continued viability of Biglaw’s edge over other firm structures revolved around the idea that Biglaw firms had the ability and will to invest in world-class knowledge management infrastructures. The idea was that the technological innovation in the areas of database management, remote access, and the like would allow Biglaw firms to index, store, and then exploit the vast amounts of intellectual capital and work product that had been generated by the firm over the years. In short, Biglaw lawyers would have access to all the information that the outside world had access to through the Internet (and more specifically for law through the traditional resources like Westlaw and Lexis), but would also be able to develop an internal resource exclusive to the firm’s own lawyers. The former has proven true, of course, but at many firms the latter never has. And in patent litigation the game is already lost. It might not be in M&A, since the Skaddens of the world are not known to be putting their deal documents out for public consumption. But if I want to compare how Boies Schiller, Gibson Dunn, and Covington handle responding to inducement claims brought against their clients, I can do so for a monthly cost less than a prime rib at a upscale Manhattan kosher steakhouse. And I can get the analysis going in seconds, with early opinions formulated in minutes.

Anyone practicing patent litigation has access to the exact same tools. It does not matter if they are Biglaw partner sitting in a downtown high-rise, or a boutique law firm owner like myself doing the research from an airport lounge. Access to the information is no longer constricted by physical space or cost. So while the past may have belonged to the Biglaw of mahogany-lined library shelves, technology has made Biglaw’s litigation work product more accessible than ever. And you can bet that we will be taking advantage of that perhaps unintended gift when it will help us do a better job for our clients. But I am also aware that when information is unshackled, there is a greater premium placed on those who know how best to synthesize it. So Biglaw’s collection of talent can’t be ignored. And we are out to show that we can’t be either.

Please feel free to send comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.

Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique. The firm’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

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