This Texas law firm saves money by flying 9 lawyers 1,900 miles to California every month on a luxe $3-million private jet.
Commuting to work on a private jet sounds like a perk reserved for movie stars and professional athletes. But it’s just a typical Tuesday for the lawyers of Patterson and Sheridan. The Houston-based firm relies on a glossy, maple-paneled $3-million Gulfstream G200 to regularly transport its staff to meetings with clients in Silicon Valley.
And while it may seem like a luxury, the firm argues it’s the most practical option.
“Given the nature of our work, it’s important to be in front of our clients and be able to look, feel and touch their technology,” Todd Patterson, a partner at the firm, which specializes in high-tech patents and intellectual property, tells CNBC Make It. He says the once-a-month trips allow for face-to-face meetings that provide a more hands-on, in-depth experience than a teleconference or video call.
Plus, relocating or opening a satellite office in the Bay Area — where commercial real estate is 40% more expensive, salaries are 50% higher and competition for technical talent is more intense, according to a 2017 report in the Houston Chronicle — would arguably make it difficult for the firm to hire new employees and ultimately result in Patterson and Sheridan passing some of the additional costs onto their clients.
Patterson, himself a pilot, founded the firm in 1996 and came up with the plan to commute via jet early on, after meeting with a client on the West Coast who ran a similar service.
“I just had a fascination with airplanes,” he says. “And it kind of piqued my interest.”
Patterson did some digging on costs, and then took a proposal to the firm’s chief financial officer, who thought it was doable. The firm, Patterson notes, has been flying for about 12 years and has had two jets.
They bought their newest one in 2016.
Although they do have a handful of secondary offices across the United States, including in San Diego and San Jose, California, where they fly frequently, the need for the plane is still prevalent, since the lawyers that “we send out there are the ones doing the heavy lifting,” Patterson explains. They’re more experienced with the tech that clients create.
A typical trip starts on a Tuesday around 7:30 a.m. CT at Sugar Land Regional Airport. The group departs the Houston hanger and makes their first stop in San Diego at 8:30 a.m. PT, where the lawyers working in that city deplane. The remaining passengers then head off to San Jose, where they touch down between 9:30 a.m. and 10 a.m. PT.
Wheels up to wheels down, the flight takes about four hours one way.
“We get pretty much a full day in San Diego and San Jose,” Patterson says, “work all day Tuesday, work all day Wednesday, and then we try to leave San Jose after lunch on Thursday. If we leave around 2 p.m.,” he adds, “we’re usually back in San Diego by about 3 p.m., and then back in Houston by somewhere between 8 p.m. and 9 p.m.
The lawyers cover more ground than just San Diego and San Jose on their trips, making stops in Del Mar, Los Angeles, Santa Cruz, Santa Clara, Palo Alto and San Francisco, as well as some northern cities near wine country, Patterson says. The firm will also use the jet to visit clients in places like Minnesota, New Jersey and North Carolina on occasion.
Though some might consider a private jet to be high class, Patterson considers itto be a workhorse, logging a stunning 150,000 miles a year. “We call it ‘the bus,’” he says. “It’s a regularly scheduled trip and it’s always full of people. It’s not extravagant. It’s more of a pedestrian experience.”
There are no flight attendants on board and the food service consists mostly of boxed lunches
The upfront cost of the jet, which runs about $2,500 an hour to operate, and the additional expenses for food, fuel and storage while the plane is idle, can make the commute pretty pricey.
But the firm is practical about how they use it. For instance, they sometimes lease it to other companies, Patterson says, which helps offset some of the costs. And when they use it themselves, they always try to make it a full flight.
But the biggest saver, perhaps, is that commuting allows the firm to avoid the exorbitant costs of living and working in California- a state where real estate is very expensive.
California ranks No. 11 of the most heavily taxed states in the country. A 2019 report from personal-finance website WalletHub finds that residents there have a 9.5% total tax burden, including 2.7% property taxes, 3.6% income taxes and 3.2% sales and excise taxes.
Patterson and Sheridan isn’t just saving money by flying to meetings on a private jet, though, they’re also saving time, a valuable commodity for lawyers who bill by the hour.
Because the firm can work on the flight, they get paid, unlike on a commercial flight, where the amount of work they can do is limited since most of it is confidential.
Culled from CNBC
