Drafting Patent Counsel Engagement and Disengagement Letters

Engagement letters are important and necessary to keep patent counsel out of trouble. According to the legal malpractice insurer CNA Financial Corp., in 65% of malpractice disputes reviewed, there was no engagement letter. Of the remaining 35%, only 15% involved a solid engagement letter that effectively limited the firm’s liability. Careful negotiation of the agreement is important to protect the parties’ interests.

Among the many issues that should be considered and addressed in engagement letters are: scope, patent services, fee agreement, right to purchase, right to assume responsibility for prosecution, exclusivity, waiver of conflict, severability, modification/waiver, and more. Further, in drafting the agreement, counsel must navigate complex ethical rules and opinions that govern acceptable and unacceptable provisions.

The disengagement letter is also critical. Termination of a relationship can happen for many reasons, but if the client thinks counsel represents them, then counsel does. Practitioners must ensure both the engagement letter and disengagement letter address the scope of the engagement, duties and compensation, confidentiality, and conflicts of interest, among other things.

Listen as our authoritative panel of patent attorneys examines the key provisions of an engagement letter and discusses the importance of a disengagement letter. The panel will offer guidance for structuring and negotiating engagement and disengagement letters.