Firms expanding due to intellectual property growth

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While many business-related practice areas took a hit during the recession, intellectual property has been a bright spot for local firms.

Several of Milwaukee’s larger operations have expanded or at least maintained their stock of IP attorneys and clients throughout the economic downturn: Foley & Lardner LLP added more than a dozen attorneys to its IP Litigation Group in the past three years, Quarles & Brady LLP added four IP attorneys and Michael Best & Friedrich LLP added five IP attorneys in 2010.

“In this economy we have seen that the most important assets companies have are intangible assets associated with patents and IP,” said Cynthia Franecki, chair of the IP department at Foley & Lardner’s Milwaukee office.

This is a stark change from pre-recession times, Franecki said, when companies relied more heavily on machinery and industrial assets.

As mergers and acquisitions and traditional corporate finance transactions dried up, companies became more protective of IP assets that required legal guidance.

“Frankly, it became a profitable area in which lawyers could participate,” Franecki said.

Given the complexity of IP litigation, said IP attorney Thomas Otterlee of Michael Best & Friedrich, it hasn’t taken much of an increase to stay busy.

“I get one or two more filings from 10 clients and that is 10 to 20 more,” he said.

In addition to the five IP attorneys the firm added last year, Otterlee said, four more have accepted offers this year.

Attorneys also said the recession made companies expect more for their money in IP representation, which prompted many to look to Milwaukee firms.

Quarles & Brady IP attorney Jean Baker said she attributes the firm’s IP expansion less to an increase in work and more to a shift in what clients want to pay for representation. Before the economic crash, national clients were content to retain counsel at coastal firms that billed higher rates, but that has changed, she said.

“The bubble may have burst with some types of IP services and people look to Midwest law firms as a good value,” Baker said.

Attorney Elisabeth Bridge of Whyte Hirschboeck Dudek SC, Milwaukee, routinely works with international companies on patents and said she agreed more affordable rates have become a strong selling point for new clients.

“Our billing hourly rates are substantially lower than New York or Washington, D.C.,” she said, “and that’s has been an attraction in building relationships with foreign counsel.”

That strategy goes hand in hand with clients looking to maximize the value of their IP assets, said attorney Brian Gilpin of Godfrey & Kahn SC, Milwaukee.

In his representation of clients such as Johnsonville Sausage LLC and Kohl’s Department Stores, Gilpin said he has seen an increase in companies looking to license activities in non-competitive fields.

Even for firms that haven’t increased IP staff, such as Godfrey & Kahn, not losing attorneys at a time when other businesses had to cut employees “almost feels like growth,” he said.

But as the economy continues to rebound, Gilpin said he expects the firm will look to add attorneys, as well.

“I foresee that happening in the not too distant future,” he said.

Jack Zemlicka can be reached at [email protected].