The top five things that can lead to a breakdown in IP firm-client relationship

The second part of the IP STARS 2017 report looks at the issues that can lead to a breakdown in relationship between in-house counsel and external IP advisers

What do the following have in common? (a) missing deadlines; (b) unethical business practice or activities; (c) failing to deliver services on terms agreed; (d) little or no transparency in billing and costs; and (e) failing to manage costs. The answer is that these were identified as the main reasons for a breakdown in a relationship with an outside adviser by the 1,200 in-house practitioners surveyed in IP STARS annual research.

Normally clients are the ultimate decision makers on the steps taken by their external IP adviser or agent. Those doing filing and prosecution work may well be reassured that only 33% of respondents strongly agreed that obtaining an IP right with little value can affect the relationship. But litigators should seriously consider alternative dispute settlement options such as mediation and negotiation, as 55% strongly agree this can affect a relationship.

client relationship survey

On the flip side, the majority disagree that lack of social interaction with in-house counsel (23%) and cultural differences (20%) affect a client relationship. Most firms socialise and interact with their clients in different ways to nurture relationships, and will surely continue to do so, but should note that only 19% strongly agreed that this helps and 59% are neutral.

To complement this question we asked in-house counsel to tell us what would make them terminate the services of an external IP adviser or agent (see box). Again, issues around costs and billing feature heavily in the comments, so were conflict of interest, insufficient communication and loss of key contacts or partners.

In a competitive market, and one where clients are demanding more for their money, external advisers must continue to demonstrate exceptional client care to minimise the risk of client relationship breakdown, deliver results at reasonable costs and add value in order to differentiate themselves. All of this culminates in a positive, demonstrable reputation which can be used to win new work.

Ending relationship – selected comments

  • "Abusive billing practices or subject matter incompetency."
  • "Excessive delays in communicating. Overcharging fees or repeated errors in billing."
  • "Ethically slippery."
  • "[Not respecting] matters addressed in our business Code of Conduct that we expect of ourselves and our business partners."
  • "If because of their advice the situation ends up being more expensive than settlement in the very beginning."
  • "Poor conflicts protocol."
  • "Failing to give feedback and information on the progress of work."
  • "Loss of key contact or significant change in team."
  • "No longer adding value."
  • "Failure to take responsibility for and proactively communicate a mistake."
  • "Not listening or respecting our needs."
  • "Disappointing results."
  • "Forwarding cases to another person in the firm without informing client."
  • "Lack of cooperation and help with options to manage costs, for example insisting on sending hard copies of correspondence at extra expense when we have asked only to receive emails."

What in-house counsel want

Also read the first part of this report which revealed what in-house counsel care about the most when selecting external IP advisers or agents.

This article was originally published in Managing Intellectual Property