We learn from Corp. Counsel, June 2010 at 81, that Hewlett-Packard’s law department is retaking most of its patent prosecution work in-house. Two years ago, only 32 HP patents were prosecuted internally; in 2009 the company handled 350 in-house and its goal for 2010 is 600 (See my post of Aug. 17, 2010: Xerox uses outside counsel for its patent work.). HP may have taken advantage of softness in the hiring market to strengthen its internal capabilities.
The General Counsel is referred to as saying that “the lawyers doing the in-house prosecution work are happier and more focused, and the costs are lower than sending it all outside.” I imagine “happier and more focused” means they are more engaged than outside lawyers. I wonder if the inside lawyers have quotas?
The ability to bring work in-house en masse is a privilege of larger law departments. HP offers a good example of economies of scale. It is also a good example of the weakness of lawyers per billion of revenue. Clearly, when HP is fully staffed with a cadre of patent scriveners that benchmark ratio will rise but if they are more cost-efficient than external counsel its total legal spending as a percentage of revenue should fall.