Having read the various comments in response to the post The Great Unregulated (why so many anonymous?) I think the issue is not whether there are regulated firms that provide poor value, or unregulated ones that are excellent, so much as whether the area of advice is important enough for society to ring fence in some way to protect consumers. For example, nobody would dispute that only doctors should be let loose on the public to provide certain types of services. So, that is the question, what types of legal services should be reserved activities that only lawyers, patent attorneys, trade mark attorneys, or whatever other discipline is permitted to provide?
Consumer protection?
If the aim of the Legal Services Act is in part, consumer protection, then these sort of questions need to be considered. Fine distinctions between trade mark attorney, and registered trade mark attorney, or trade mark agent, are not going to be easy for the public to understand. The question is, should the public be protected against the clerical assistant who worked for a short stint in a law firm, and who then sets himself up in business as a trade mark agent because they can’t find any other work? Their knowledge may be miniscule, but it will be greater than that of the lay public, so they may well be able to attract work if they price themselves cheaply enough. Does society think that trade mark registration is important enough to become a reserved activity? What about web design, search engine optimisation, marketing and many other areas where anyone can set up in business…. with little experience, and pick up the ropes as they go?
The Unregulated
What is unhelpful in my opinion is the rivalry between professional bodies, and all the protected titles that are devised in order to mark out a particular group as the ones who should be consulted above all others for that particular area of work. Surely, other regulated entities are not the real problem. If the people who should not be allowed to mislead the public by use of titles are the unregulated sector, (possibly those people with little background in law, who may be passing themselves off as suitable to provide legal services), then let's find solutions to stop some of their unregulated activities.
If we thought trade mark registration work should be a reserved activity, then it might be relatively easy to prevent certain people filing trade marks as agents for others. They might still find a role providing help to the public to draft their own applications, but at least their limited capacity to act would mark them out as a different type of trade mark agent. But in the absence of some radical measure like this to distinguish between providers, what is the point of reserving use of titles, if there would be some other title that the unregulated would be able to use in order to provide their desired service?
Protecting Titles
In the meantime, we are in the ridiculous situation where confusion reigns over who may or may not call themselves trade mark attorneys. For example, recently, after verifying on this post that there appeared to be an error in the IPO’s booklet Choosing the Right IP Adviser I wrote to the IPO to point out that solicitors could also call themselves trade mark attorneys and could they please correct the error. To my astonishment this week I received the following reply from ‘Debbie’ of the iPO:
Thank you very much for your feedback on the 'Choosing the Right IP Adviser' booklet which has been forwarded to me from Paolo Senese. Please accept my apologies for the delay in response but I have been absent due to a bereavement.
I can confirm that the point you have raised re: page 7 about Trade Mark Attorneys is being looked at. This issue has also been raised by another Attorney.
The text in the booklet was taken from the CIPA website relating to Trade Mark Attorneys and cleared internally by TM colleagues, but as you rightly state this does not tie in with Section 84 of the Trade Marks Act 1984. Thus, "trade mark agent" and "trade mark attorney" remain open for anyone to use.
I have been discussing with CIPA and I understand that the Protected Titles Committee recently considered the matter and was making a report to Council on 5th January in which it is suggested that the public would be misled now by anyone using the term if they are not on the Register of Trade Mark Attorneys. The reason for this is that the treatment of trade mark attorney is now in all other respects analogous with the treatment of patent attorney and with the "Register of Trade Mark Attorneys" now in place the public is likely to assume that someone using the title is entered on the Register. Thus the Committee is proposing that Council should issue guidance to Fellows that they should not use the title unless they are also entered on the Register. Whether that will be accepted by Council I do not know and am trying to establish the outcome of the report with CIPA.
CIPA has confirmed that they will not be updating their website until the outcome is known with the view that I would amend the publication at that time.
I will be more than happy to provide you with an update when I hear anything further from CIPA.
Thank you for your interest in the IPO publications and if you have any further feedback in due course this would be most welcome.
I was amazed that the IPO seem to think that CIPA have the right to make changes except possibly with regard to their own members. If CIPA wish to issue guidance to Fellows that they should not use the title Trade Mark Attorney unless they are also entered on the Register, I doubt this would have effect on anybody else’s use of this term. It's also surprising that the CIPA website has this statement about the term Trade Mark Attorneys. What happened to consultations with other interested parties?
While I agree with CIPA that all these terms are confusingly similar, I do object as a solicitor, to them effectively trying to deprive solicitors of the use of the title. It speaks volumes about the problems that need to be addressed. I read recently that there is a realisation that greater consideration is needed as to the activities that should be reserved and what Alternative Business Structures (ABS) will be able to provide once legal services are deregulated. Otherwise, consumers are in danger of being misled.
While Jeremy’s suggestion that some further research is needed in this area is correct, it clearly needs to focus on both regulated and unregulated IP providers.
Showing posts with label legal practice. Show all posts
Showing posts with label legal practice. Show all posts
Saturday, 29 January 2011
Tuesday, 27 October 2009
The future for small practitioners
This morning I held a breakfast meeting for small firms of solicitors to discuss the future under the Legal Services Act 2007, when the rules allowing Alternative Business Structures come into effect in 2011. We had an interesting discussion, and I may post another blog about some of what we discussed, but here I just want to mention the business model of running as a consultant rather than a law firm. This is what is happening in society generally, and is something too few solicitors consider when embarking on life outside large law firms.
It seems to be a clever way of operating as a solo nowadays to set up as a consultant rather than as a sole practice. There is a glut of lawyers, and the danger in setting up a solo practice is that you may find yourself trapped in a situation where you can't close down the firm (unless you're willing to pay 6 times your annual Professional Indemnity insurance by way of run off cover), and yet have to continue unless someone either buys the practice from you, or is willing to take over your liabilities.
Many solo firms lack the business and marketing skills required to create a truly successful business that someone will buy off them. The problem is that they set up their firms for the wrong reasons - redundancy, or for lifestyle reasons, and then find it doesn't provide the income they had hoped for.
If you don't set up your own law firm but instead offer your services on a case by case basis to other law firms (usually the larger ones) at far lower hourly rates than you would need to charge if you had your own law firm, you can still work from home, and get to use your expertise, but you stand to make a lot more money. You make more than you were making as a salaried employee, and much more than many solos make who set up their own firms.
You probably need to 'attach yourself' nominally to one of your client firms, who will put you down on their practising certificate renewal application form, but otherwise you are free to work for a number of different firms, and each assignment you undertake will be covered under the insurance of the client firm.
If you find a prospective client who wants your skills, but perfers to have you contract through a big brand law firm then you can refer the work to one of your bigger law firm clients, (collect a referral fee for this) and do the work at your normal rate. Similarly, if the client wants to pay lower fees you can refer the matter to a smaller client firm, again collect a referral fee, and do the work charging your normal rate. The client gets the same expert either way but gets to choose whether to use a large branded law firm or a smaller, cheaper one. You have none of the headaches about professional indemnity insurance. Your hourly rate is low enough to be affordable by either large law firms or smaller ones.
The wrong choice of business model underlies many of the problems solos face. Increasingly as it becomes more and more expensive to operate as a solicitor because of the regulatory overheads being piled up on law firms, why would anyone starting out want to burden themselves with a law firm? If you are a patent attorney, then it's easy enough for you to continue to practice. But for solicitors who don't want to or have nothing to offer if they drop their solicitor title, the solution is to set up as a consultant.
The time for running a lifeystyle law practice is coming to an end. Unless you've got a unique business proposition to offer clients don't set up your own law firm. The promise of lower fees and a more personal service, which you may or may not be able to deliver on, is increasingly not enough of a differentiating factor to win business for a solo practice.
It seems to be a clever way of operating as a solo nowadays to set up as a consultant rather than as a sole practice. There is a glut of lawyers, and the danger in setting up a solo practice is that you may find yourself trapped in a situation where you can't close down the firm (unless you're willing to pay 6 times your annual Professional Indemnity insurance by way of run off cover), and yet have to continue unless someone either buys the practice from you, or is willing to take over your liabilities.
Many solo firms lack the business and marketing skills required to create a truly successful business that someone will buy off them. The problem is that they set up their firms for the wrong reasons - redundancy, or for lifestyle reasons, and then find it doesn't provide the income they had hoped for.
If you don't set up your own law firm but instead offer your services on a case by case basis to other law firms (usually the larger ones) at far lower hourly rates than you would need to charge if you had your own law firm, you can still work from home, and get to use your expertise, but you stand to make a lot more money. You make more than you were making as a salaried employee, and much more than many solos make who set up their own firms.
You probably need to 'attach yourself' nominally to one of your client firms, who will put you down on their practising certificate renewal application form, but otherwise you are free to work for a number of different firms, and each assignment you undertake will be covered under the insurance of the client firm.
If you find a prospective client who wants your skills, but perfers to have you contract through a big brand law firm then you can refer the work to one of your bigger law firm clients, (collect a referral fee for this) and do the work at your normal rate. Similarly, if the client wants to pay lower fees you can refer the matter to a smaller client firm, again collect a referral fee, and do the work charging your normal rate. The client gets the same expert either way but gets to choose whether to use a large branded law firm or a smaller, cheaper one. You have none of the headaches about professional indemnity insurance. Your hourly rate is low enough to be affordable by either large law firms or smaller ones.
The wrong choice of business model underlies many of the problems solos face. Increasingly as it becomes more and more expensive to operate as a solicitor because of the regulatory overheads being piled up on law firms, why would anyone starting out want to burden themselves with a law firm? If you are a patent attorney, then it's easy enough for you to continue to practice. But for solicitors who don't want to or have nothing to offer if they drop their solicitor title, the solution is to set up as a consultant.
The time for running a lifeystyle law practice is coming to an end. Unless you've got a unique business proposition to offer clients don't set up your own law firm. The promise of lower fees and a more personal service, which you may or may not be able to deliver on, is increasingly not enough of a differentiating factor to win business for a solo practice.
Sunday, 31 August 2008
Further thoughts
I was encouraged to see some interest in the topic of my post ‘Food for thought’ in the form of two anonymous comments and a few emails from people, the majority of whom were not looking to join my proposed network – indeed could not qualify given that they were neither UK solicitors nor UK based. But people did raise interesting points which I would like to answer in this post.
One theme that emerged from comments was how much some solos value the solo life with its absence of hassles of managing staff, having to recruit, run offices etc etc. Life is so much simpler just working solo, and the regulatory burdens are not too onerous for many in other jurisdictions. This may possibly be because they don’t operate the equivalent of our client accounts. Without doubt in most jurisdictions operating a client account is what brings into play the full weight of the regulatory burdens. Many also feel that their clients receive a better service from them than from large law firms.
I have to say immediately, that facilitating for solos the sort of lifestyle they currently enjoy and want to maintain is precisely what I’m trying to offer them the chance to continue in the future when it may be less possible to practice as solos – at least in the UK as solicitors. They could do so by joining the Azrights network and working from home.
One theme that emerged from comments was how much some solos value the solo life with its absence of hassles of managing staff, having to recruit, run offices etc etc. Life is so much simpler just working solo, and the regulatory burdens are not too onerous for many in other jurisdictions. This may possibly be because they don’t operate the equivalent of our client accounts. Without doubt in most jurisdictions operating a client account is what brings into play the full weight of the regulatory burdens. Many also feel that their clients receive a better service from them than from large law firms.
I have to say immediately, that facilitating for solos the sort of lifestyle they currently enjoy and want to maintain is precisely what I’m trying to offer them the chance to continue in the future when it may be less possible to practice as solos – at least in the UK as solicitors. They could do so by joining the Azrights network and working from home.
As to the threats on the horizon that is potentially going to endanger the lifestyle of true solos See for example comments in the Law Society’s Gazette in the July 2008 supplement on Professional Indemnity Insurance (which unfortunately is not available online for me to link to), by Simon Young, a practice management consultant and Law Society Council member who
“predicts that increasing compliance demands are likely to give further impetus to the wave of mergers among smaller firms. He draws a parallel with sole practitioner independent financial advisers (IFAs), who struggled to cope with compliance issues on their own when the amount of regulation affecting their practices grew exponentially. IFAs were either forced to merge, outsource compliance at great cost or be roped in as tied agents…. There are now very few one-man-band IFAs. Compliance for the legal profession is undoubtedly a resources issue and I am afraid it militates against small businesses and sole practitioners in particular"..
By trying to find a way for solo lawyers to exist in peace in future as practising solicitor solos, I am hoping to find a solution that produces a WIN WIN outcome for everyone. Anyone who can see the writing on the wall – namely, that the growing regulatory burdens in the UK are going to increase the costs of operating a law firm, and so make it unviable for solo firms to operate as sole practices in future, will want to look around for possible solutions. The one I mentioned of joining Azrights network is one such possibility. Doubtless there are others. However, burying ones head in the sand is not a sensible option.
In view of the incredulity from some people showed as to whether the Inland Revenue would accept that solicitors operating in this way could be self employed, rather then deemed employees, I can confidently say 'yes' because the model is not a new one. There are many law firms operating this way, and indeed IFAs too. So at the time of writing the Inland Revenue does not have a problem accepting this way of working in the legal profession as anything but self employment. For further information about this and how the lifestyle works, here are some articles relating to a law firm in the UK – Keystone Ltd - here and here
“predicts that increasing compliance demands are likely to give further impetus to the wave of mergers among smaller firms. He draws a parallel with sole practitioner independent financial advisers (IFAs), who struggled to cope with compliance issues on their own when the amount of regulation affecting their practices grew exponentially. IFAs were either forced to merge, outsource compliance at great cost or be roped in as tied agents…. There are now very few one-man-band IFAs. Compliance for the legal profession is undoubtedly a resources issue and I am afraid it militates against small businesses and sole practitioners in particular"..
By trying to find a way for solo lawyers to exist in peace in future as practising solicitor solos, I am hoping to find a solution that produces a WIN WIN outcome for everyone. Anyone who can see the writing on the wall – namely, that the growing regulatory burdens in the UK are going to increase the costs of operating a law firm, and so make it unviable for solo firms to operate as sole practices in future, will want to look around for possible solutions. The one I mentioned of joining Azrights network is one such possibility. Doubtless there are others. However, burying ones head in the sand is not a sensible option.
In view of the incredulity from some people showed as to whether the Inland Revenue would accept that solicitors operating in this way could be self employed, rather then deemed employees, I can confidently say 'yes' because the model is not a new one. There are many law firms operating this way, and indeed IFAs too. So at the time of writing the Inland Revenue does not have a problem accepting this way of working in the legal profession as anything but self employment. For further information about this and how the lifestyle works, here are some articles relating to a law firm in the UK – Keystone Ltd - here and here
They are by no means the first or only such business, as there have been others before them, such as Woolley & Co who were one of the first virtual law firms.
My hope is to do something interesting using this model for growing an IP and Technology law practice. It remains to be seen whether there will be sufficient interest from small IP practices in the next few years to make it happen. Watch this space as they say!
Wednesday, 27 August 2008
Food for thought for IP lawyers
Times are tough – and in some ways, perhaps more so for sole practitioner solicitors in the increasingly onerous regulatory climate being imposed by the Solicitors Regulation Authority. Running a business for a ‘one man band’ is hard enough – never mind once you add into the equation an extra layer of compliance obligations.
Clearly the new era of regulation will make it untenable eventually for true sole practices to continue in business. This is already evident from anecdotal stories of lawyers being refused insurance to set up new sole practices. How many of us are now waiting anxiously to find out the new premiums our insurers will impose? It is traditionally one of the worst times of the year for small firms of solicitors. On top of that is the impending difficulty small firms are expected to face in responding to the new questions the SRA will ask at practising certificate renewal time.
So, when a fellow sole practitioner mentioned that he was considering closing his practice, paying run off cover, and re-establishing himself as an IP consultancy, I thought there must be a better way. Surely it should be possible for highly skilled IP lawyers to be able to use their skills and solicitor title without having to run their own businesses, or go and find a job in a law firm. Many lawyers simply want to get on with their client work. They are not interested in running a business, especially one which involves spending more and more time familiarising themselves with and implementing an array of new regulations.
Then it occurred to me that perhaps I could help my friend, and he could help me. I want to grow Azrights into a top notch IP and Technology practice , and would welcome experienced lawyers on board to help achieve this. By joining Azrights as self employed lawyers, my friend and others would be able to continue working as solicitors, based either at home, or in their own offices anywhere in the country. They would continue to act for their own clients, except that they would do so under the Azright brand.
Among the benefits to them would be leaving all the regulatory and client account headaches to Azrights to manage. We would also provide the IT and email infrastructure to enable remote working. An added bonus is our website and blog which will soon appear prominently in search engines, providing an excellent resource for marketing. Lawyers in the network will be part of a firm, and will have opportunities for interacting with each other and giving and getting cross referrals. Further benefits include access to administrative and junior legal staff so that there is the option to delegate work which should be done at a more junior level,.
Clearly there is a huge difference between the network of lawyers I have in mind for Azrights, and some other types of lawyer networks, which are really only agents collecting revenue from the fees generated by self employed lawyers. If any IP solicitors out there are interested in discussing the possibility of joining Azrights network please get in touch.
Clearly the new era of regulation will make it untenable eventually for true sole practices to continue in business. This is already evident from anecdotal stories of lawyers being refused insurance to set up new sole practices. How many of us are now waiting anxiously to find out the new premiums our insurers will impose? It is traditionally one of the worst times of the year for small firms of solicitors. On top of that is the impending difficulty small firms are expected to face in responding to the new questions the SRA will ask at practising certificate renewal time.
So, when a fellow sole practitioner mentioned that he was considering closing his practice, paying run off cover, and re-establishing himself as an IP consultancy, I thought there must be a better way. Surely it should be possible for highly skilled IP lawyers to be able to use their skills and solicitor title without having to run their own businesses, or go and find a job in a law firm. Many lawyers simply want to get on with their client work. They are not interested in running a business, especially one which involves spending more and more time familiarising themselves with and implementing an array of new regulations.
Then it occurred to me that perhaps I could help my friend, and he could help me. I want to grow Azrights into a top notch IP and Technology practice , and would welcome experienced lawyers on board to help achieve this. By joining Azrights as self employed lawyers, my friend and others would be able to continue working as solicitors, based either at home, or in their own offices anywhere in the country. They would continue to act for their own clients, except that they would do so under the Azright brand.
Among the benefits to them would be leaving all the regulatory and client account headaches to Azrights to manage. We would also provide the IT and email infrastructure to enable remote working. An added bonus is our website and blog which will soon appear prominently in search engines, providing an excellent resource for marketing. Lawyers in the network will be part of a firm, and will have opportunities for interacting with each other and giving and getting cross referrals. Further benefits include access to administrative and junior legal staff so that there is the option to delegate work which should be done at a more junior level,.
Clearly there is a huge difference between the network of lawyers I have in mind for Azrights, and some other types of lawyer networks, which are really only agents collecting revenue from the fees generated by self employed lawyers. If any IP solicitors out there are interested in discussing the possibility of joining Azrights network please get in touch.
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