Patent Annuity Invoice Savings:
Agent Fees
Agent Fees - Where's the Money Going?
This week, we continue our deep dive into patent annuity invoice savings and shift from last week’s currency focus to another murky topic – agent fees.
What Are Agent Fees?
Many PTO’s support direct payment from annuity providers, but a number of jurisdictions still require payment by a local agent. All annuity vendors have an agent network with negotiated rates, which are (theoretically) passed along to clients. Compared with currency costs, agent fees normally represent a smaller percentage of the invoice, but they can add up.
How Can Agent Fees Deliver Annuity Invoice Savings?
Like currency costs, attempting to get the detail behind agent costs from (some) annuity providers can be a frustrating experience. Some argue that this is confidential competitive information that can’t be shared. Car manufacturers don’t publish itemized costs for car manufacturing; fast food restaurants don’t publish the cost of buying a hamburger bun.
The challenge with agent fees is that most clients assume that agent fees are treated like any other third-party legal disbursement and passed directly to the client. Unfortunately, there have been several incidents where a vendor charged an agent fee when no agent was used or added additional markup to agent fees. These practices inflate the total cost of annuity payments and are challenging to monitor.
What You Need to Do For Annuity Invoice Savings
While most vendors don’t make it easy to understand patent agent costs, that doesn’t mean you shouldn’t try. Here are three tips to help you gain control of your agent costs.
- Require that your annuity vendor identifies jurisdictions where they use agents
- Require that your annuity vendor provide and maintain an agent fee schedule
- Revisit your annuity contract, strengthen language related to agent fees and get a cost schedule
