AI’s Disruptive Impact on Patent Attorney’s Business Model

Falk Metzler
7 min readMay 8, 2024

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Like only a few other legal areas, Patent Attorneys and IP professionals seem threatened by the rise of Artificial Intelligence and Large Language Models; terms that both stand a beacon of progress and a potential disruptor for private patent practices.

As AI technologies increasingly permeate patent drafting and prosecution processes (and beyond), patent attorneys are confronted with a dual imperative: Grasping the profound implications of AI on their traditional practices and at the same time navigating the economic uncertainties it introduces.

In this blog post we address the transformative role of AI in patent law and will underscore the critical need for patent attorneys to not only understand but also actively adapt to their profession’s transformation . By embracing AI as a tool for enhancement rather than a threat to obsolescence, patent attorneys can safeguard their relevance and capitalize on new opportunities in an AI-augmented future.

INCREASING PRESSURE

Displacement and Automation

One of the key concerns for patent attorneys is the potential displacement of their traditional roles due to automation. For instance, a Goldman Sachs report from March 2023 assumes that 44% of legal tasks can potentially be automated by generative AI, a figure that in the patent industry may in fact be significantly larger, because patent prosecution, the backbone business of most patent practitioners, revolves around analyzing and producing text, making it susceptible to automation. For European Patent Attorneys for instance, especially those with international clients, interactions are often limited to document exchanges without face-to-face consultations. Their work involves textual tasks like aligning disclosures with claims, crafting claims that capture the invention’s essence, and meticulously comparing prior art with a claimed invention for assessing novelty and inventiveness.

These tasks, though critical, are systematic and rule-based, making them prime candidates for AI automation. AI’s precision and efficiency in handling complex analyses will therefore significantly streamline the patent prosecution process, reducing the reliance on human expertise for these fundamental yet labor-intensive pre-grant patent work of patent attorneys.

In fact, AI’s skills in tasks like patent searches, prior art analysis, patent document generation, swiftly analyzing vast patent databases, and even flagging potential infringements is about to disrupt the status quo. This automation raises valid apprehensions about the future role of human experts in these domains.

This shift will gradually redefine the role of patent attorneys, pushing them towards more strategic, advisory, and interpretative functions that leverage their deep legal and technical understanding beyond what AI can currently achieve. The apparent pressure on patent attorney’s traditional business model will probably be the biggest challenge for this technically skilled but conservative profession in the coming decade.

Shift in Skill Demand

The widespread adoption of AI in the patent industry will not only disrupt the profession’s traditional business model, but likely also the skill sets required of patent attorneys. As AI systems become increasingly adept at typical tasks of patent attorneys, the demand for attorneys skilled in data analysis, AI oversight, and technology management will likely surge. Attorneys who can effectively leverage AI tools, interpret their outputs, and strategically manage AI-driven workflows will be highly sought after.

For that reason, patent attorneys will need to actively expand their skill sets, continuously learn and engage in cross-disciplinary collaboration. Those who can seamlessly integrate AI into their practice will be well-positioned. Others will likely suffer competitive disadvantages and economical setbacks.

Economic Pressure

Another the top concern of patent attorneys is client price pressure. As AI makes patent work more efficient, clients will demand lower fees since the work is less labor-intensive. In fact, it seems inevitable that clients will want to share in at least some of the efficiency gains from AI through reduced pricing. Patent law firms will have to balance maintaining margins with keeping clients happy.

Adding to this concern is the expectation that so called alternative legal service providers (ALSPs) will likely gain a competitive advantage over traditional IP law firms by using AI to automate more legal work at lower costs. The expected reduction of volume of work outsourced to traditional patent law firms will additionally increase competition and price pressure for the industry.

Disruption

The legal industry in general and the patent industry in particular are facing a seismic shift in their professional habitat. Until 2030 at the latest, AI will have had a profound impact on the industry, not mere incremental changes, but a fundamental disruption of the patent profession’s operational framework. Traditional legal roles will be reshaped, including even potential obsolescence in certain areas of IP law like in the patent attorney’s business. As patent law firms need to integrate AI, they are challenged by significant alterations in their practice, their client interaction, their fee structure and turnovers, their skills and more.

Generative AI may represent a “Kodak moment” for patent attorneys, signaling a disruptive shift in their traditional business model. As AI automates the creation of bespoke writing content, patent attorneys face downward pressure on fees for drafting services, as their value proposition shifts from content creators to editors and advisors. This economic upheaval mirrors Kodak’s failure to adapt to digital photography, underscoring the urgency for patent attorneys to embrace AI and redefine their roles.

TRENDS IN LEGAL AI FOR PATENT LAW

The Benefits of AI for Patent Attorneys

In the first place, the integration of AI in patent drafting should of course be viewed as a transformative opportunity for patent attorneys. Automating labor-intensive tasks like patent application drafting will dramatically enhance efficiency, reduce operational costs and ultimately allow attorneys to focus their expertise on strategic aspects and providing value to clients.

Moreover, AI’s analytical skills can aid in comprehending intricate technical nuances, facilitating attorney’s practice and adding value to services. If done correctly, the adoption of AI does not have to diminish the patent attorney’s role; rather, it could augment their capabilities to the benefit of clients and attorneys.

Advancements in AI

The adoption of AI technology in the patent industry is expected to evolve significantly over the next 5 years. Here are the top three key developments:

Increased Automation and Productivity: AI tools will continue to automate routine tasks, such as prior art searches and initial patent drafting, allowing patent attorneys to focus on higher-value tasks like strategic planning and client counseling. This will lead to increased productivity and efficiency in the patent process. This adoption will likely lead improved patent quality.

Technological progress and accelerated adoption: AI and LLM technology is expected to evolve significantly over the next five years. Enhanced predictive power, personalization, and efficiency, will drive AI adoption across legal practices. There may even be a chance that AI could achieve human-level performance in many tasks by the end of the decade, with some even suggesting the possibility of human-level AI by 2030. The trend towards human-AI collaboration is expected to intensify, with AI and LLMs augmenting human skills and enabling new forms of teamwork.

Evolving Legal Frameworks: In terms of patent law, legal frameworks will need to adapt to address questions of inventorship and patentability. On a broader scale, the legal landscape of AI is expected to become more complex, with governments at various levels seeking to regulate the deployment of AI. One first prominent example of legislative regulation is the EU’s AI Act , which may serve a blueprint for other jurisdiction.

PREPARING FOR THE AI-DRIVEN FUTURE

Education and Skill Development

Attorneys will have to adapt to the new AI landscape. To thrive, they’ll need to acquire AI literacy — understanding the intricacies of machine learning processes. Patent attorneys should actively seek training in AI technologies, data analysis, and computational thinking. Developing a deep comprehension of how AI systems operate, their strengths, limitations, and ethical implications is crucial. By gaining these skills, attorneys can effectively leverage AI as a powerful tool, ensuring they remain in control of patent processes.

Strategic Adaptation

To prepare for the AI-future, patent law firms must actively adapt their business models. The following steps may be necessary along this path:

  • Invest in AI training programs tailored for patent professionals, equipping them with the skills needed to leverage AI effectively.
  • Develop clear AI implementation roadmaps, addressing data governance, regulatory frameworks, and change management — mitigating risks while maximizing AI’s potential.
  • Explore AI-powered tools for patent drafting, prior art searches, and office action responses. This allows attorneys to focus on high-value tasks.
  • Implement robust quality control measures to ensure AI outputs meet legal and technical standards.
  • Rethink billing models, offering AI-assisted fixed-fee services or subscription-based models aligned with client needs.
  • Embrace transparency, educating clients on AI’s role in delivering cost-effective, high-quality services.
  • Foster a culture of continuous learning and innovation.
  • Encourage cross-functional collaboration between legal, technical, and business teams to identify AI use cases that drive adoption.
  • Regularly review and update AI strategies based on emerging technologies and industry best practices.

Collaboration and Innovation

Apart from internal and management measures, patent law firms should consider to work closely with technologists to understand AI capabilities and limitations, ensuring their legal services align with the technology. By bridging expertise across domains, novel solutions can emerge, transforming legal services delivery. Patent attorneys gain a competitive edge by leveraging AI’s potential, while technologists benefit from legal insights to develop responsible AI applications.

CONCLUSION

It should be clear by now, that AI’s impact is poised to reshape the patent law landscape profoundly. The risks and concerns that this paradigm shift brings about, can only be mitigated by patent attorneys and IP law firms by actively engaging with evolving AI technologies to remain competitive in the upcoming legal era.

Although risky and complex, this transition presents numerous opportunities, such as reduced drafting costs may increase patent filing volumes. Forward-thinking patent attorneys can capitalize on AI to streamline operations, focus on higher-value services, and position themselves as strategic IP advisors.

Failure to adapt, however, could leave firms trailing behind AI-driven competitors, missing critical insights, and struggling to deliver efficient, high-quality services at competitive prices.

The time to act is now. As a patent attorney, you should begin to examine and then exploit AI’s transformative potential to future-proof your practice. The opportunities are vast — seize them, or risk obsolescence.

At ALPHALECT.ai, we explore the power of AI to revolutionize the European IP industry following a clear vision for its future, building on decades of collective experience in the industry. For answers to common questions, explore our detailed FAQ. If you require personalized assistance or wish to learn more about how legal AI can benefit innovators, SMEs, and legal practitioners, don’t hesitate to contact us at your convenience.

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Falk Metzler
Falk Metzler

Written by Falk Metzler

Co-Founder of Alphalect.ai and committed to transform the traditional European IP landscape.

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