As LFJ recently reported, despite the gradual relaxation of rules around Alternative Business Structures (ABS) for law firm ownerships in some states, we have yet to see a wider adoption of the practice across the U.S. However, one investment company is already taking advantage of the new rules in Arizona to form a business that acts as both a patent database and a law firm designed to offer an end-to-end service for new tech startups.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
As LFJ recently reported, despite the gradual relaxation of rules around Alternative Business Structures (ABS) for law firm ownerships in some states, we have yet to see a wider adoption of the practice across the U.S. However, one investment company is already taking advantage of the new rules in Arizona to form a business that acts as both a patent database and a law firm designed to offer an end-to-end service for new tech startups.
Reporting in Bloomberg Law details how MDB Capital Holdings, a Dallas-based investment company with a focus on intellectual property, secured approval from Arizona’s ABS committee to launch PatentVest as an approved law firm. MDB’s chief executive, Chris Marlett, described how PatentVest is designed to provide inventors with all the services they need to nurture their technology, protect those inventions with strong patents, and provide an opportunity for some of these startups to go public.
Marlett notes that by combining the investment facility and legal services in one business, this will allow clients to reduce the cost of legal services whilst also unifying the entire technology development and patent strategy process in one place. Whilst some critics of outside ownership of law firms have pointed to potential conflicts of interest between the investment incentive and the legal process, Marlett suggests that traditional law firms are incentivized by generating a high volume of billable hours, whilst PatentVest is focused on developing successful technology leaders.
