30 March 2022

Who Were The Leading Australian Patent Prosecution Firms in 2021?

Running raceWith significant increases in both standard and (especially) innovation patent applications, 2021 should have been a bumper year for patent attorneys operating in Australia.  And although that was true overall, the benefits were not uniformly distributed.  While some smaller firms experienced gains in filing numbers well above the overall growth rate, a number of larger firms within the publicly-listed ownership groups struggled to keep pace.  Spruson & Ferguson remained the biggest filer of new applications – particularly following integration of the Shelston IP business – but achieved virtually no overall growth in new filings.  The number of applications filed by third-placed Griffith Hack actually fell in 2021, with the firm narrowly avoiding falling behind fourth-placed FB Rice.

Having a focus on incoming work from foreign applicants, Spruson & Ferguson filed only marginally more new standard patent applications on behalf of Australian residents than its closest competitors, Davies Collison Cave and Griffith Hack.  About half of all filings handled by Spruson & Ferguson originated in the US, slightly above the overall proportion of 45% Australian standard applications by US applicants.  A handful of firms – particularly RnB IP, Pizzeys, and FPA Patent Attorneys – rely far more heavily on US-originating work, while Madderns is notable for handling a higher proportion of filings from China than from the US.

Looking beyond filings to ongoing patent prosecution work, Spruson & Ferguson was the leader in 2021, by a large margin.  Generally speaking, firms with larger numbers of filings over the previous few years had more prosecution work in 2021, which was an advantage for Spruson & Ferguson and Griffith Hack despite their failure to keep pace with their competitors in terms of growth in new filings.  The flip side of this, of course, is that relatively lower filing numbers in 2021 will result in less prosecution work over the coming years.

Read on for all the details.

New Application Filings

The chart below shows the total number of Australian patent filings, broken down into standard, innovation and provisional applications, made by the top 18 firms.  The chart also shows filings made by ‘non-attorney’ agents (i.e. where the filer is a person or entity other than a registered patent attorney, attorney firm, or any named applicant or inventor), and ‘self-filings’ (i.e. where the filer is a named applicant or inventor).

2021 Australian Patent Filings by Application Type

Spruson & Ferguson – a member of the IPH Limited (ASX:IPH) group – was, by a considerable margin, the biggest filing agent for Australian patent applications, following integration of the Shelston IP business from 1 November 2021.  (All applications originally filed by Shelston IP have been attributed to Spruson & Ferguson.)  Fellow IPH firms Griffith Hack, Pizzeys, and AJ Park placed third, seventh and eleventh respectively.  The two major members of the QANTM IP Limited (ASX:QIP) group, Davies Collison Cave and FPA Patent Attorneys, placed second and sixth.  (The third QIP Australian patent attorney firm, Cotters, did not quite make the top 18.)  The top ten was rounded out by ‘traditional’ privately held firms FB Rice (4th), Phillips Ormonde Fitzpatrick (5th), Wrays (8th), Alder IP (9th) and Madderns (10th).  It is notable, however, that Alder IP earned its place due to innovation patent applications filed on behalf of Chinese applicants, without which it would not have appeared in the chart at all.

In common with previous years, the overwhelming majority of self-filings in 2021 were innovation and provisional applications.  Other applications filed without professional assistance were dominated by innovation patents, mostly filed by Australian residents providing a local correspondence address on behalf of Chinese and Indian applicants.

Innovation patent applications grew by 71% overall, driven strongly by the imperative to file before phasing-out of the system from 26 August 2021.  Firms that have been relying heavily on innovation patent filings – most obviously Alder IP and, to a lesser degree, firms such as Madderns and Patentec – have now lost this source of work and revenue.  Unless they can pick up a significant amount of new standard and provisional filing business they can expect to drop down the rankings in the new post-innovation patent environment.

As I have previously reported, 2021 saw an increase of 10.6% in new standard patent application filings.  However, as the chart below shows, this growth was not distributed uniformly across patent attorney firms.

2020-21 Relative Change in Standard Patent Filings

Notably, almost all firms within the IPH and QANTM listed ownership groups, with the sole exception of Davies Collison Cave, achieved less than 10% growth in filing numbers, with Spruson & Ferguson barely breaking even and Griffith Hack losing ground.  Of the larger privately-held firms, only Wrays achieved an increase in filings significantly above the overall average growth of 10.6%.  The biggest winners from the surge in standard patent applications appear to have been smaller privately-held firms.

Standard Patent Filings by Australian Residents

The chart below shows the number of Australian standard patent applications filed by leading attorney firms naming at least one Australian resident applicant.  The ranking in this chart is based on the total number of standard applications filed (i.e. not including innovation and provisional applications) from all countries of origin.  On this measure Alder IP and Patentec have dropped out, making way for Halfords IP and Houlihan2 to enter the list.  The chart indicates the proportion of ‘mixed origin’ applications, i.e. those including one or more non-Australian joint applicants.  As can be seen, the majority of applications filed by Australian residents do not include any foreign co-applicants.

2021 Australian Standard Patent Filings with Resident Applicants

While Spruson & Ferguson was the largest filer in 2021 on behalf of domestic residents, it is not as dominant in this segment of the market.  Firms that handled a higher proportion of filings for Australian applicants relative to their overall ranking (i.e. those with a larger mix of domestic clients) include Griffith Hack, FPA Patent Attorneys, Michael Buck IP, and Halfords IP.  Conversely, Pizzeys and RnB IP (which was founded by two ex-Pizzeys partners, resulting in litigation that is still ongoing) have business models that are almost entirely reliant on filings by foreign applicants.  AJ Park also files few applications on behalf of Australian applicants, however this is primarily because it is a wholly New Zealand based firm.

Standard Patent Filings from Leading Countries of Origin

The following chart shows the number of standard patent applications filed by leading firms on behalf of applicants resident in Australia and in the top five foreign jurisdictions – the USA, China, Japan, Germany, and the UK.

2021 Australian Standard Patent Filings by Country of Origin

In 2021, 45% of all Australian standard patent applications were filed by applicants based in the US, and it is therefore unsurprising that many firms handle a high proportion of US-originating filings.  There are, however, a few firms that are particularly focussed on serving US-based clients.  Of those firms that filed over 500 applications in 2021 (RnB IP and upwards in the rankings), the most heavily skewed towards US business are RnB IP (91%), Pizzeys (75%), and FPA Patent Attorneys (61%).  Madderns, by contrast, is notable for a relatively low proportion (28%) of US-originating filings, and high proportion (34%) of filings on behalf of Chinese applicants.

Prosecution Events

While filing new applications is a significant source of revenue for patent attorney firms, it is only the beginning of a process of prosecution (i.e. examination and – hopefully – acceptance and grant) that typically extends over a number of years.  In Australia, the most common ‘prosecution events’ include filing a request for examination, receiving and advising on examination reports, preparing and filing responses to examination reports, and processing the acceptance of successful applications.  The chart below summarises the total numbers of these events over the five year period from 2017 to 2021.Australian Standard Application Prosecution Events 2017-2021

While there are annual variations, resulting from the pipeline of pending applications, and examination resources available to be allocated to them, the total number of prosecution events has recently been fairly consistent, at nearly 100,000 per year.  On top of filing new applications, each of these events generates additional work and revenue for the patent attorney firms that are responsible for handling the corresponding applications.

The chart below shows a comparison of a measure I have called ‘prosecution intensity’ for the leading patent attorney firms in 2021.  This measure is a weighted sum of standard patent filings plus all of the above types of prosecution events for each firm, over the full year.  Exam requests have the lowest weighting in this scheme, with office actions (examination reports and acceptances) given a double weighting, and substantive attorney actions (filing applications and responding to examination reports) given a triple weighting.  This is obviously a pretty crude measure, and is not intended as an accurate representation of typical work and/or revenue generation.  But it does provide for a simple comparison between firms across all aspects of patent prosecution.

2021 Leading Firms Relative Standard Patent Prosecution Intensity

Using this measure of prosecution intensity, Spruson & Ferguson’s lead over its closest competitors is even greater than on the measure of filings alone.  This is presumably because prosecution intensity reflects ongoing activity resulting from applications filed in previous years, when the firm (and the predecessors that have since been merged into it) had a larger share of new filings.  A similar observation can be made of Griffith Hack, which experienced a reduction in new filings in 2021, but remains slightly ahead of Davies Collison Cave in prosecution intensity on the strength of its higher numbers of filings in the past.

The prosecution intensity measure highlights the importance of past filing performance in determining the present volumes of prosecution work available to each firm.  By extension, it also foreshadows the impact of present gains (or losses) in new filings for the volumes of prosecution work likely to be available in the future.  While firms can pick up prosecution work through transfers of existing applications and portfolios, clients of Australian and New Zealand patent attorneys are generally hard to shift.  In an earlier analysis, I found that only 1.4% of nearly 280,000 ‘live’ cases were transferred between firms over a 16 month period, and that these transfers mostly resulted in a general redistribution of responsibility, rather than any systematic flow of business to particular firms.  For the most part, then, it can be expected that changes in the number of filings in a given year will be reflected in prosecution intensity during subsequent years.

Conclusion – When Past Performance Is Indicative of Future Results!

While there was little change in the names appearing at the top of the list of leading patent attorney firms in 2021, the largest firms struggled to achieve growth in filing numbers at or above the average increase of just over 10%.  Meanwhile, a number of smaller firms grew their filings by more than twice the average rate.  Firms within the IPH group, in particular, failed to keep pace with the overall growth in Australian patent filings in 2021.  Even so, the significant lead held by the larger, slower growth, firms means that there is little prospect of them being caught by smaller, higher growth, firms in the foreseeable future.

Maintaining filing numbers is important not only for present performance, since new applications filed in one year are the source of prosecution work for a number of subsequent years.  Looking at a measure of ‘prosecution intensity’ confirms that firms with relatively higher filings in previous years were stronger performers in 2021.  By the same token, we would expect to see those firms with greater filing growth in 2021 convert that advantage into high prosecution intensity in coming years.


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