Lawyers Make Big Killing as File Drawer Yields $613M

Wiley Rein’s 100 or so partners are expected to collect at least $200 million of the Blackberry settlement.

By: Kim Eisler

To read the news coverage of the BlackBerry patent battle, you might have thought that Arlington-based NTP, which extracted $613 million from Research in Motion, BlackBerry’s Canadian manufacturer, actually existed.

In fact, NTP was the paper creation of two lawyers, Don Stout of Arlington and James Wallace, a patent lawyer at K Street’s Wiley Rein & Fielding. At most, NTP was a file drawer and a name on some legal documents.

After his firm invested about $7.5 mil­lion in the case over four years, Wal­lace was able to persuade a judge that Research in Motion infringed on a series of patents that subsequently were in­val­id­­at­ed by the US Patent and Trade­mark Office. At­torneys in the field say Wallace’s work was amazing—and incredibly profitable.

Wiley Rein’s 100 or so partners are expected to collect at least $200 million of the settlement, with the rest going to Stout, to about 20 of his investors, and to the widow of a Chicago inventor who claimed to have invented wireless e-mail before RIM thought of it.

In an average year, partners at Wiley Rein bring home $745,000. The BlackBerry settlement will add nearly $2 million per partner to the firm’s annual haul and should vault Wiley Rein partners to the top of the 2006 listings as Washington’s most profitable firm. Lawyers at Skadden Arps, who usually lead the list, make about $1.8 million a year.

Wallace, who brought the case into the firm and managed it, is likely to receive a little something extra. The native South Carolinian, who is unmarried, headed to London for two days to celebrate his victory. Then he traveled to New York, where he is defending a generic-drug maker against allegations by the manufacturer of the acid-reflux drug Prilosec that his client, Mylan Laboratories, infringed on some patents.

Another day, another side of the legal aisle—and a lot more dollars.