Patent News | "Patent-Litigation Specialist Diversifies"

Category:Patent News

The path to success has gotten rockier for the Dallas-based law firm McKool Smith, which is coming off a remarkable 12-year run based largely on lucrative wins in patent-litigation cases.

The 177-lawyer firm, one of the biggest law-firm success stories of the past decade, faces dramatically different terrain today than it did back in 2000, when Mike McKool, the firm's co-founder, bet that pursuing infringement claims against technology companies could lead to big payoffs.

To the casual observer, it might appear that we are living through a golden age of patent litigation. Prominent technology companies like Apple Inc., AAPL +0.16% Samsung Electronics Co. 005930.SE +0.60% and Microsoft Corp. MSFT -0.26% are battling in venues all over the world, largely over the designs and features of smartphones and tablets.

Despite the appearance created by the smartphone wars—which have yet to render a big-dollar jury verdict in favor of a plaintiff—patent litigators and intellectual-property experts say that in recent years, federal legislation and court rulings have made it harder for plaintiffs to win patent cases. Critics, including some judges, have cast deep doubt on patent litigation generally, largely on grounds that the U.S. Patent and Trademark Office has issued too many dubious patents in recent years.

As a result, McKool Smith is finding itself facing headwinds.

"McKool is a very good firm with remarkably good leadership," said Max Grant, a patent litigator and partner at Latham & Watkins LLP who has followed the firm's rise. "But the landscape has changed, and there's a lot of talk within the patent bar over whether McKool can keep it up—and if so, how."

Mr. McKool didn't set out to get rich pursuing cases for plaintiffs—or to build a patent juggernaut. When he founded McKool Smith in 1991 with another Dallas trial lawyer, Phillip Smith, the firm had about a dozen lawyers, none of whom specialized in patents or intellectual property. "At the time, I couldn't even spell patent," said Mr. McKool, a calm-tempered, courtly Texan who will turn 63 later this month. "Our designs back then really were pretty simple—to create a really fantastic business-litigation boutique that we'd keep pretty small."

But over the next few years, a confluence of events persuaded Mr. McKool to change his mind.