Stout Expert Profile: Kevin McElroy

Stout Expert Profile: Kevin McElroy

We sat down with Intellectual Property expert Kevin McElroy to discuss what goes into being an expert, how he approaches his work, and his overall experience.

November 17, 2023

Kevin McElroy - Intellectual Property and Damages Expert



M.B.A., University of Chicago, Booth School of Business
B.S.F.S., International Political Economy and International Affairs, Georgetown University

Focus Industries


Healthcare, Medical Devices, Software, Technology, Media, Telecommunications, Consumer Product

Courts Testified In


Federal, State, Circuit, American Arbitration Association

Q&A With Kevin

Describe your practice to us and how you got to this point in your career.

My career has been devoted to understanding, analyzing, and articulating the economics of intellectual property (IP). This has, from one angle or another, been the focus of every day that I have spent at work in my career. I have valued all classes of IP – patents, trademarks, trade secrets, copyrights, and even some things that don’t fit neatly into those buckets – to help firms and inventors use these assets in their business. I was one of the first employees at a start-up that built the world’s first financial exchange that directly listed patent portfolios as consumable, tradeable assets – like a commodities exchange. And I have worked on hundreds of litigation engagements, each with their own set of facts and circumstances that have each required an open mind and a bespoke approach to fairly and compellingly articulate the economic impact of IP assets, their use, or their infringement.

What makes you particularly qualified as an expert in IP disputes?

My practice proceeds from a few core principles. First, that for any asset that has value, that value can be articulated. Much of my work relates to analyzing intangible assets that professionals with different training and specializations do not feel comfortable putting a number on. But when you say right at the outset that, if someone owns this, has paid for it, and wants it valued, there is certainly a way to articulate that value, then you’re not making up an answer, you’re trying to discover something that already exists. 

And second, that in order to find that value, the right balance of open-mindedness and reliance on well-accepted principles is essential. Most of the cases I take on look 90% similar to something I’ve done before, or something that exists in the case law. The key to doing this work well, in my opinion, is recognizing and leveraging those similarities while also understanding the 10% that is new and different and solving that new problem with creativity and an open mind. 

What about IP litigation interests you the most?

The concept that ideas have value and, often, more value than traditional, tangible asset classes. Intuitively, this shouldn’t be surprising – the companies that are most successful and profitable are the ones that are able to innovate and put great ideas into practice. But, actually putting a number on that is a really interesting challenge. The litigation aspect makes that challenge all the clearer – whatever you do to perform your analysis, there is going to be a counterparty motivated to point out the flaws and try to prove you wrong. There is no greater motivation to do your best work than knowing that it is going to be evaluated and critiqued by really smart people.

What was one of your more notable cases and why?

I was hired by a defendant to value a geographical exclusivity term of a larger contract. To me, this is sort of the very essence of IP valuation – it’s something that you wouldn’t normally think of as an asset in the same way you would think of a patent or a brand as an asset. And yet, it’s absolutely possible that geographic exclusivity could be a key driver of profit for a company, so it’s totally valid to try to model the value of that contract term. 

Ultimately, the jury agreed with my valuation of the term, which was validating. But even apart from that, it’s an example of a novel way of thinking about business assets that is illustrative of what is interesting about working in this space.

What types of clients do you work with? How do you bring value to them?

I’m typically retained by outside counsel hired by a party to a litigation, but while working on an engagement, I will often interface with in-house counsel as well as folks on the business and technical sides of a firm. In terms of bringing them value, I find that the best and highest value-add work that I do proceeds from an iterative process where I listen to as many perspectives as possible before, during, and after forming my own opinions. I may have an initial impression of the way a piece of IP can drive value, but ultimately my conclusion is only as good as the information that I’m working with.

Having an open mind and marshalling all different types of expertise – from technical people who understand how an invention works, to attorneys who understand patent claims from a legal perspective, to people who live and breathe a relevant product line or industry – is often the only way to understand all of the context necessary to perform what typically has to be a fairly nuanced analysis.

Once I have that context, I work with the other talented professionals at Stout, and we use our experience, our deep knowledge of financial and economic concepts, and our creativity and problem solving. At that point, I like to say we’re “turning words into numbers” – taking complex relationships between an invention, a product, a business, and a market and boiling it down to a quantification of its economic impact.

What trends are you seeing in IP? What can we expect in the next five to ten years?

In the 16 years I have been doing this work, legal precedent governing patent damages has become more and more stringent, and I expect that to continue. I think this will place greater emphasis on the expert to properly analyze value as well as to articulate and defend that analysis compellingly.

Downward pressure on patent damages awards, combined with increased invalidity risk, will also fundamentally change the trade-offs for companies that need to decide whether to publicly disclose innovations in an attempt to be awarded patents or to try to protect them as trade secrets. To the extent the latter becomes more appealing, we could see a continued increase in both the volume of trade secret litigation and the size of those awards. I think that consultants and experts in this space will want to stay up to speed on the relevant case law in both the patent and trade secret spaces to maximize the value they can provide to clients.

What are the biggest lessons you have learned in your career? What guidance would you give to people early in their career that are pursuing a similar career path? 

There is no substitute for the importance of a strong team. At the end of the day, an expert signs his or her name on the bottom of a report, but it is almost never the case that every word of the report and every number in a calculation is the sole work product of that individual. Our deliverables are significant undertakings with many moving parts, and even the best and most well-respected experts in this space need great teams who communicate well, understand their roles, and are motivated to find the right answers. My advice to those who are at the beginnings of their careers would be to understand their importance within this structure, to build and value those relationships, and to always be eager to mentor the people who come up behind them.

You have been at Stout for 10 years and recently became a Managing Director. What do you think was the biggest factor in achieving this position?

I have always tried to think about how to best add value to our firm and my colleagues in much the same way I try to solve problems for my clients. I have been fortunate to have great mentors at Stout who have empowered me to try to improve the way our group runs and make sure my colleagues and our clients are having their needs met. And, in the other direction, I have worked with incredibly talented professionals in junior roles who have been eager to learn and motivated to be part of something bigger than themselves. To the extent I give myself credit, it is largely for being forthcoming when I have seen a gap between the status quo and something that I think could be even better. Beyond that, the credit for my success at Stout is attributable as much to my team as to myself.

What makes Stout stand out among the competition?

At the risk of answering with a cliché, I do think Stout is in something of a Goldilocks zone in terms of our size. As we have grown – and we’re about five times larger now than we were a decade ago when I was hired – we have never shed the tenacious, small-firm mentality that attracted me to Stout in the first place. But our reach, our resources, and our brand have come so far since then. I do not know of any competitors who are small enough and trusting enough to let individuals who have great ideas make a difference while also being able to back them with the resources that they need to execute on those ideas.

What interests do you have outside of work?

I have two daughters, three years old and seven months old at the time of writing this, so my wife and I spend most of our “free time” taking care of them, which has been a wonderful privilege and challenge that I wouldn’t trade for anything. I also love to play tennis, and I try to read a couple of books each month.

What is an easy item on your bucket list that you haven’t done yet?

I have been a huge sports fan all my life, which has come with its fair share of thrills (go Yankees!) and frustrations (go Knicks!). Over the past 10 or 15 years, I have come to closely follow Tottenham Hotspur, a soccer team in the English Premier League. I have not yet gotten over to London for a game but plan to do so soon, maybe when my older daughter is ready to make the trip (she’s already my weekend morning game-watching buddy).

If you had a chance to live abroad with your family for a year, where would you choose and why?

Before we had our girls, my wife and I decided to take a two-week road trip all around Ireland, starting and ending in Dublin and making a big circle around the country in between. It was the best trip we’ve ever taken and, to the extent there was a downside, it was that we moved between different cities so quickly. I would love to spend a year in Ireland that was made up of a couple of months each in five or six of our favorite places – with our daughters joining us this time – and really immerse ourselves in the culture of the country.