Patent Attorney Costs:
Flat Fees Work Better for Clients

One of the first questions many potential clients ask is: “How much do you charge?” This can be difficult to answer without more information from the client. Unlike other patent law firms that bill by the hour and can easily quote an hourly rate for their patent attorney costs, our firm charges flat fees for patent attorneys to do specific work. This means we have to understand enough about what needs to be done in order to accurately quote a flat fee for that work.

The Billable Hour System: Bad for Clients

According to Clio’s legal trends survey report for 2022, most consumers (67%) want the option to pay for legal services via flat fees. In spite of this clear consumer preference, 97% of law firms charge hourly rates for their services.

The Billable Hour rate model charges clients based on the number of hours spent on their case, billed in 6-minute increments (rounded up). This leaves small businesses and individuals feeling like they’ve written a blank check for legal fees, with no control over the final cost.

You Can’t Budget If the Final Cost is Uncertain

Since the final cost for patent attorney services billed by the hour is uncertain, clients may find it difficult to estimate or control their expenses. This lack of predictability can be financially burdensome, especially for individuals or businesses with limited resources. If the work takes longer than expected, you could end up spending significantly more than budgeted or planned.

You Could Run Out of Money Before the Finish Line

If the hourly fees add up to more than you can afford to pay, you might unexpectedly need to stop the work before it’s finished. The money you already spent would be wasted. You can’t file an unfinished patent application.

You Might Hesitate to Contact Your Patent Attorney, Even When You Need To

When you have to pay for every minute of your patent attorneys’ time, you’re more reluctant to contact them. But your patent attorneys can’t effectively advise you if they are missing information. Sometimes the freedom to ask a quick question – without worrying about how much it will cost – can prevent larger, more expensive problems from arising later.

Cheaper Hourly Rates Can End Up Costing More

Comparing hourly rates doesn’t give you an accurate idea of the final cost for a patent attorney. Cheaper hourly rates can actually add up to a more expensive final bill. Senior patent attorneys cost more per hour, but they are also more experienced and efficient, and thus can typically finish the same work in less time. If a senior patent attorney charges $500 an hour and finishes researching, drafting, and submitting a document in 10 hours, the final cost would be $5,000. But if a junior patent attorney, who only charges $300 an hour, takes twice as long to finish the same work, the final cost would be $6,000.

Billing by the Hour Rewards Inefficiency

Under the billable hour model, law firms have a financial incentive to work slowly and inefficiently. The longer it takes to finish work, the more hours can be billed to the client. This can incentivize patent attorneys to write overly broad patent applications that fail to consider what is most valuable for your business to protect. Overly broad patent applications result in many more rounds of office actions to argue with patent examiners, thus increasing the overall cost to obtain an issued patent.

Nickel-and-Diming Every Minute and Every Expense Inflates the Final Cost

When you are billed by the hour and charged for every expense, it costs money to track and itemize the billing for all those expenses. Every sheet of paper printed or copied. Every cent of postage paid. Every minute spent on the phone, responding to email, researching online, drafting and reviewing documents, even thinking about your case. And then every minute it takes to track, compile, and invoice those expenses.

Each block of time gets rounded up to the nearest 6-minute increment, meaning that dividing the work into separate, smaller tasks results in paying for more time than you actually used.

Imagine how this typical back and forth interaction between an Inventor and a Patent Attorney would be charged under the billable hour model:

And that is just with the standard 6-minute billing increments that most attorneys use. An ABA analysis found that 21% of lawyers rounded their hours up to the next half hour or hour. Rounding up to the next half hour, your invoice would be 4 billable hours for those 58 minutes. Rounding up to the next hour, your invoice would be 8 billable hours.

Of course, you could call your patent attorney and argue that you were overcharged, but you would have to pay the billable hourly rate for that conversation too.

Retainer Fees Tie Up Large Amounts of Money Until the Work is Finished

Attorneys collect money upfront before performing any work. But billing by the hour means that they can’t predict what the actual final cost will be. So they charge you thousands of dollars in retainer fees, which represent a certain number of billable hours, plus expenses, to get started on your case.

The retainer is held in a client trust account, and then they regularly invoice and pay themselves from that account as they work on your case. Once the retainer is spent, work stops until you pay another retainer to continue. When the work is complete, any retainer money remaining is returned to you.

For a small business, keeping thousands of dollars set aside as a retainer for legal fees can tie up money that is needed for other expenses. And having to pay additional retainer fees at unpredictable intervals can make it difficult to budget properly.

Flat Fee Rates: Better for Clients

Instead of charging clients for every billable hour and each individual expense, the flat fee rate model charges clients a flat fee for specific work.

In order to accurately quote a flat flee, the patent attorney needs to take the time to fully understand the client’s needs and create a plan to efficiently and effectively protect what matters to the client’s business. Thus, the value of the work becomes the focus of the engagement, rather than the attorney’s time. With flat fees, clients benefit from knowing the final cost before the attorney begins the work.

Flat Fee Attorneys Have Happier Clients

A 2016 report from LexisNexis found that 68% of clients on flat fees would ‘wholeheartedly’ recommend their attorney, compared with only 45% of clients on hourly fees.

You Can Budget for the Final Cost with Flat Fee Patent Attorneys

When patent attorneys quote flat fees, you know what the final cost will be, and can budget accordingly. No more blank checks for an unknown number of billable hours.

According to a 2016 report from LexisNexis, 92% of clients on flat fees ended up paying either what they expected or even less. By contrast, 63% of those on hourly fees ended up paying more than they expected.

A Predictable Cost Enables You to Set Aside the Funds Needed to Finish the Work

When you agree to the patent attorney’s flat fee for your patent application, you have peace of mind that you’ll be able to get your patent application finished and filed. You don’t need to worry about going over budget and running out of money halfway through.

Contact Your Patent Attorney Without Running Up Your Bill

When you pay a flat fee for patent attorney services, you don’t have to pay extra for phone calls and emails when you have questions. You have the freedom to reach out and get legal advice before making any decision about your company’s intellectual property. This can prevent problems from popping up later and ensure that your attorney has all the information needed to do the best work possible for you.

Flat Fee Rates Reward Results and Promote Efficiency

As Nathaniel Burney writes, “Billing by the hour can actually be a bad thing if one happens to be the kind of lawyer who gets results.”

Flat Fees align the attorney’s interests with the client’s interests: getting results. When patent attorneys charge flat fees, the emphasis becomes the value of the work instead of the time spent, thus rewarding attorneys who solve problems quickly and efficiently.

Flat Fees for Patent Attorneys Eliminate the Billing Bureaucracy

Patent Attorneys who charge flat fees eliminate the overhead expenses of billing by the hour, costs that would otherwise inevitably pass on to the client. You don’t end up paying for timekeeping and invoicing costs like: tracking software for phones, emails, printers, and copiers; and administrative staffing to handle monthly invoicing.

No Money Tied Up in Retainer Fees – You Only Pay for the Actual Work

With the billable hour model, your money is tied up in retainer fees, and you have to wait until the work is finished to get the remaining balance returned to you. When a patent attorney quotes a flat fee, you only pay the flat fee for that specific work and don’t have to pay any extra money as a retainer.

The flat fee is considered “earned on receipt,” which means that the attorney is not required to deposit it to a trust account and then invoice against it to pay themselves. Since the flat fee is payment for the agreed upon work, with no remaining retainer balance, none of the money needs to be held in trust.

How Our Patent Attorney Flat Fee Process Works

Our Free Consultation Figures Out the Scope of Work

Our free phone consultation is how we figure out what work we need to do and what the flat fee should be for that work.

Firms that bill by the hour limit your initial consultation to 30 minutes before they start billing you for their time. But we need enough information upfront to be able to accurately quote a flat fee for our patent attorneys’ work, so we don’t put a time limit on our free phone consultations.

Everything you disclose in the free consultation is confidential. US Patent Regulations require that all patent attorneys keep your invention secret — whether you hire them or not.

Since all patentable inventions are unique by definition, the work required for each patent application is also unique. So you will need to disclose enough about your invention for us to understand the scope of work. More complex inventions may require more complex patent applications to protect them, which will be more work and cost more. And some inventions may require multiple patents to protect separately stealable parts of the whole. We need to fully understand the work required before we can quote a flat fee for patent attorney services.

Our Simple Engagement Letter Explains the Work Covered by the Flat Fee

Instead of an overly complex contract you would need another lawyer to review before you signed, we send you a simple engagement letter that explains the process and the flat fees involved.

You Don’t Pay the Flat Fee All at Once, You Pay in Installments

The engagement letter outlines the payment itemization for your specific case. For example, when writing patent applications, we only ask for the first half of the flat fee to start the work. After you approve the patent illustrations, you pay the patent illustration fee. Once we finish the first half of the patent application, including the patent claims, you then review and approve the draft. Upon payment of the second half of the flat fee, we complete the rest of the patent application. After you approve the final draft of the patent application, we file it at the USPTO, paying the filing fee directly to the US Patent Office using your payment card. Dividing the total patent preparation and filing costs into smaller payments, spread out over months, makes the process more affordable for individuals and small businesses.

Adding New Disclosure May Require an Additional Flat Fee for the Additional Work

Inventors are always inventing and improving their inventions. But if you add new disclosure or make changes after we’ve quoted our flat fee for patent attorney services, we may have to add an additional flat fee to account for the new work that represents.

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