Reason Why Conflict Clearance in IP Field Is Very Important

Reason Why Conflict Clearance in IP Field Is Very Important

As you may know, a patent law firm may not represent plural clients in the same technical field so that no conflict matter arises. This principle is very important, since patent attorneys handle clients’ inventions that include a lot of confidential information.

In the past, most of the Japanese IP law firms stuck to the principle and they seemed to appropriately perform clients segregation based on the technical fields.

However, recently, Japanese IP firms are getting bigger like in other countries, although they are still much smaller than US firms. Please see the table below showing top 10 Japanese IP firms (ranking based on the number of patent attorneys).

Japanese IP firms are getting bigger like in other countries.

 

In general, as the firm grows, they tend to place emphasis on large companies’ cases and to raise their service fees, so that they can make payment to satisfy the firm’s payroll, overhead and client disbursements.

Further, the number of patent applications in Japan (excluding PCT national phase entries into Japan) has decreased as shown in the following graph.

Number of patent applications in Japan is decreasing.

 

Under the circumstances, Japanese IP law firms, especially big firms, have no other choice but to handle multiple clients’ cases in the same technical field. In order to avoid any conflict matter, such firms basically establish firewalls (so-called a “Chinese Wall”) so that attorneys handling one client’s cases may not access database for other clients in the same technical field. Further, some Japanese applicants, especially large companies, perform conflict check procedures by themselves.

However, under the current situation, it is highly probable that conflict matters occur on a daily basis and a patent attorney handling one client may know its competitor’s confidential information. Ideally speaking, we think that each IP law firm should handle only one client in each technical field, although we also understand the difficulty. One of the reasons that we established our firm was to pursue our ideals, and therefore, at our firm, we perform our conflict check procedure to confirm that we have no conflict with representing the client every time we receive a new patent application. We check and review not only the title of the application but also the entire claims with reference to the relevant portions of the specification and figures, so that we can confirm that there is no conflict being adverse to the existing clients.

The criterion of our judgment is simply the order we receive the client’s formal instruction. We represent overseas venture companies and individuals and each of them files less than one application in Japan a year. As our firm grows, we sometimes receive cases from large global companies, but if we are aware of any conflicts that would preclude us from handling the case, we sincerely report the situation. It appears to be attractive at first glance to receive cases from large companies, but our policy is to cherish each client’s one patent application in Japan in the long term, regardless of the number of applications they file. Of course, we hope all of our clients that we provide our services to may grow together with our firm (and file many applications in Japan in the future …).

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