BOSTON — Intellectual property firm Fish & Richardson will jettison close to 40 additional lawyers this year by shutting its Austin, Texas, office and cutting corporate transactional lawyers firmwide even as it collects more lucrative patent litigation work than its peers.

By the end of the year, Fish & Richardson expects to close the Austin office, which lists 26 lawyers on the firm’s Web site. The firm also said it plans to bid goodbye to most of its 14 corporate attorneys, except for a “small number” of Northeast lawyers whose practices leverage the firm’s intellectual property expertise and strength.

Meanwhile, Fish & Richardson topped a patent litigation list with 77 cases last year, according to the 2009 Patent Litigation Survey recently published by IP Law & Business, an NLJ affiliate publication. The firm’s caseload is 21% lighter than it was in 2007, but it has 20 more cases than Chicago-based Kirkland & Ellis, the next law firm on the list.

In a statement, Fish & Richardson said it “continues to make strategic decisions to invest the firm’s resources in ways that build on our fundamental strengths and core competencies.”

The firm’s decision highlights the challenges that IP firms face in recessionary times. Closing Austin was a difficult decision but ultimately “best for the future of the firm,” noted the statement. “Throughout these turbulent times, the firm’s enduring commitment to our clients remains paramount.” The firm is planning a severance program for the Austin lawyers and workers.

Corporate groups can bring in new work for intellectual property firms, but many firms are “making the decision to double down in areas of strength” in the current market, said Kent Zimmermann, a Chicago-based consultant with the Zeughauser Group legal consulting shop. “When I see a firm like Fish & Richardson, which is known as IP firm, cutting their corporate department in a market where corporate departments are faltering badly, it’s not completely shocking,” he said.

Corporate budget cuts hit corporate transactional and intellectual property litigation practices especially hard this year, so it makes sense for a firm to focus on its stronger group, said Michael B. Rynowecer, president of Wellesley, Mass.-based BTI Consulting Group. “They’re keeping certain corporate partners, [so it looks as though] they’re trying to leverage the IP litigation strength, but abandoning the stand-alone corporate market,” Rynowecer said.

Fish & Richardson started slashing its head count last November, only a month after opening its 11th office in Houston. From November through January, 49 attorneys and technology specialists were laid off or left Fish & Richardson. 

Then in May, the firm laid off 35 lawyers and 85 support staffers, according to NLJ sister publication The AmLaw Daily.

It’s important for law firms not to hold on to underperforming partners, practice areas or offices, particularly if they do not align with the firm’s strategic plans, Zimmermann said.

“Now is the time to be decisive in making tough decisions and to get lean,” Zimmermann said. “A lot of firms delay in making tough decisions, but now is not the time to do this.”

Sheri Qualters can be reached at sheri.qualters@incisivemedia.com.