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Raising the Bar Allows Trademark, Patent Attorneys to Incorporate
07 September 2012
For the first time, patent and trademark attorneys will be able to practice under the corporate structure of a larger law firm, thanks to a provision in Australia’s Raising the Bar Act which allows them to incorporate.
Prior to the Act, says Leiann Vicars, a senior associate at King & Wood Mallesons, it was an offence for a firm to allow a practitioner to practice as an attorney if the firm was incorporated. “The problem it created was that a non-incorporated partnership couldn’t be part of an incorporated firm, resulting in two separate firms and two separate sets of books and files.”
Lawyers at Ashurst said that the most significant impact of this change will be for firms that include both patent and/or trademark attorneys and other professionals, usually legal practitioners. Currently, if the legal practitioners of such firms operate through a corporate structure, the firms must operate a separate unincorporated partnership for the attorneys.
“Allowing patent and trademark attorneys to incorporate will remove the need for this separation and therefore the additional expense incurred from having to doing so. Practically, this may enable more legal firms in Australia to offer patent and trademark attorney services,” the Ashurst lawyers said.
Jane Brown, a lawyer with Choy Lawyers in Melbourne, says that incorporation will provide a very tangible benefit for some. “This gives greater confidence for patent and trademark attorneys to practice outside of a ‘law firm’ environment, as they are now able to incorporate and therefore protect their personal assets,” she says.
Despite the benefits of incorporation – the limiting of liability and the ability to form shared practices with other professionals – Brett Connor, a partner with Freehills Patent Attorneys in Melbourne, believes the Act is unlikely to have any practical effect on incorporation. “Very few, if any, large firms will incorporate due to tax issues related to incorporation,” he says. “And as the most likely professionals to join with in an incorporated entity are legal practitioners, the ability to do so is still dependent on the respective state based laws which govern the operation of legal practitioners.”
Mark O’Donnell, a partner at Madderns Patent & Trade Mark Attorneys in Adelaide, cautions that the practical effect of incorporation is unknown at this time. “It may be practical and advantageous for newly formed firms to incorporate but the advantages for existing firms may be outweighed by the difficulties,” he says.
