RatnerPrestiaâ€™s traditional method for valuing our services, and thus the amounts billed for those services, depends on both objective and subjective considerations.Â These include the professional time required to render services in a given matter valued on the basis of the nominal billing rate for the professionals involved.Â
This valuation is qualified, however, taking into account the efficiency with which the services were performed, and the training time involved, if any.Â Consideration is then given to subjective factors such as the degree of responsibility entailed in rendering the service, the valuation that similar services might justify in other firms, and the quality of the end result of those services, to the extent that quality is perceived to be significantly above or below what we think the client should expect.Â Finally, this valuation may be adjusted, before or after the services are billed, to take into consideration any reasonable assessment made by the client with respect to any factor affecting that valuation.
Non-traditional methods for valuing our services are becoming increasingly commonplace and we encourage clients to suggest or inquire about such non-traditional billing practices, also known as Alternative Fee Arrangements, or AFAs.Â In some cases, AFAs may involve â€śBillable Hoursâ€ť as a factor in the valuation process but in many cases they do not.
Patent and trademark prosecution services, for example, often lend themselves to fixed fee arrangements, depending on the nature and volume of a particular clientâ€™s work.Â We render such services to a number of clients on a fixed fee basis for defined phases of patent and trademark prosecution.
For clients seeking predictability of charges for freedom to operate studies, risk assessments, transactional counseling and even litigation, we offer options based on division of the expected services into a number of discrete stages.Â At the inception of each stage, we discuss with the client the objectives to be achieved in that stage and the effort and resources that we estimate will be needed to achieve that objective.Â When we are sure we are aligned with the clientâ€™s objectives and expectations, and we have an agreed upon definition of the scope of services to be rendered in that stage, we then provide to the client a hard estimate, or possibly even a fixed fee, that we expect to bill at the conclusion of that stage.
As still another example, we may agree to participate in the planning stage of a due diligence study, at no cost to the client, for the sole purpose of defining intellectual property issues that should be investigated and, at that time, consider a fee arrangement, possibly fixed on either a total project basis or a stage-wise basis.
In the wake of the recent economic downturn, many companies are faced with tighter budgets and increased pressure to manage expenses, including legal expenses.Â Companies are asking their outside counsel, including their IP counsel, to abandon the traditional hourly billing model and switch to alternative fee arrangements.Â We feel the approaches outlined above, are responsive to the needs of these clients and that is the reason we encourage clients to discuss with us a reasonable billing arrangement that best suits their needs.