THINGS YOU NEED TO KNOW BEFORE YOU START – Part 2
This is a continuation of the discussion on the due diligence steps attorneys considering Legal Process Offshoring (LPO) should take before outsourcing their work. As stated in the prior article, the practice of offshoring/outsourcing has received the approval of the ABA, other state bar associations and the USPTO, but this approval comes with certain parameters. Whether considering assistance with nonprovisional or provisional patent applications, patent searches, patent drawings, or other patent services, protecting your client’s data, as well as ensuring you do not fail to uphold your duty of effective representation to your client throughout this process are your primary considerations.
PERFORM THE NECESSARY DUE DILIGENCE ON THE LPO PROVIDER BEFORE OFFSHORING YOUR WORK
1.The USPTO and Export Control
The USPTO issued a Notice in the Federal Register in 2008 (FR Doc E8-16830 filed 7/22/08) that many people have misinterpreted to mean that the agency does not allow the offshoring of work that includes the preparation of patent applications. On the contrary, the USPTO was clarifying its role in screening patent work for export control issues. The agency noted that it issues a foreign filing license for patents to be filed in other countries, a part of which includes export control screening. But it does not provide the same type of screening for subject matter sent to other countries for the purpose of patent application preparation. The exporting of data for the preparation of patent applications continues to be covered by the Bureau of Industrial Security and its Export Administration Regulations. This is why it is critical that your offshoring partner possess the capability to screen your disclosures for export control purposes, and that screening is done in the US or by a US citizen overseas prior to revealing the disclosure to a non-US citizen.
2. The duty to supervise the outsourced services
Once you are satisfied that the LPO provider has the expertise to do the work, and will adequately protect your client confidences and secrets as well as protect you from potential export control and conflict of interest issues, you are ready to start - but your duties do not end here. Your continued duty throughout the LPO process, is to vigilantly supervise the outsourced services. There are a number of ways to accomplish this depending on the project that is outsourced. For searches, the attorney must know the databases to be searched to ensure a comprehensive search. In addition, the attorney should request a copy of the search terms and classifications prior to the start of the search. This review is critical to ensure the LPO provider is conducting the search in the same way that the attorney would if he or she was conducting the search on their own. Obviously the results must also be scrutinized so that the attorney feels comfortable the search is comprehensive and the findings are supported by the evidence.
3. Draft Patent Applications and Office Action Responses
Even more so than with searches, it is critically important that the attorney establish an iterative process with the LPO Provider to ensure that draft Patent Applications and Office Action responses are the attorney’s work. It is a violation of your duty to your client to take a draft response from the LPO Provider, sign it and file it without a thorough review of the work. One approach to consider for draft applications is to have the Provider send you “an understanding of the invention” after it has reviewed your disclosure. This will ensure the Provider is approaching the work exactly the way you want. A second approach is to have the Provider send you a draft of the claims, again to ensure that the claims will not be too broad or too narrow. Once the draft application is completed, you should have a pretty good idea of what it contains because you have been involved throughout the drafting process. This also has the added advantage of reducing the amount of time you need to spend editing a draft before filing it. Similarly with Office Action Responses, have the Provider send you an outline of its approach for your review ahead of time. Once you have reviewed and edited or approved it, the finished product should closely mirror your approach. By spending a small amount of time up front and during the process, you will save a significant amount of time reviewing and/or editing the draft before filing.
4. The Duty to Inform your client
Because offshoring would be considered a significant event related to your representation of your clients, you need to disclose to them ahead of time of your plans to offshore some of their work. Some clients may have objections to sending disclosures off shore, so the best approach is to include this disclosure in your retainer agreement that they will sign. Because your clients will rely on you as their representative to ensure their interests are protected, so as long as you are supervising the work and reviewing it before filing your clients should not have an objection. This is particularly true if they are going to receive a price discount because you are able to save them money by offshoring. It is also important that your billing be transparent in this regard. If the costs of offshoring are going to be passed along directly to the client, such as with drawings, the client must know this ahead of time. If you are providing the service for a fixed price then it is important that the amount of the fee is in proportion to the value of the services performed.
LPO can be an effective and efficient tool for your IP practice. Safeguarding your practice and your client’s interests while doing so are of the utmost importance. The due diligence steps before and during the LPO process described above are critical to your effective representation of your client and the protection of your practice. The business benefits to your practice of utilizing LPO are readily apparent, as are the benefits of mitigating the risks involved.