Posts Tagged: "patent license"

So here we are, many years later and IV’s philosophy seems to have changed. No longer is litigation a poor way to monetize patents, but rather IV sees itself as having a responsibility to litigate. The self-righteousness of IV’s claims is why they engender such distrust, even bordering on hatred. For so long they came in peace and now that they have the leverage they seem to be playing a different tune, and using patent litigation with greater frequency. They accumulated patents over time, sometimes getting as much as $50 million from companies like Google, eBay, Sony, Intel, Microsoft, Apple, Nokia and others, ostensibly for the purpose of obtaining a defensive patent position. Oh how the tables have turned.

Licensing your invention is a lot easier if you can show that it’s selling. That means you have to produce a small quantity of your product. Nice idea – until you learn that a plastic injection mold costs $25,000. Now what? Fortunately, there are options. You just have to know where to look.

You might want to consider some type of up front guaranteed payment to ensure that you get at least something. This may seem overly pessimistic, but it is the job of any attorney negotiating or drafting a license to assume that things will go wrong. The agreement can never contemplate everything, but with respect to payment you need protection. What if the licensee is paying you a defined percentage of sales but then decides to offer your product for free, or as an add-on to a sale, as is common in direct TV marketing? If your product is used as a “come on” and given away for free even 100% of $0 is still $0. That is why some type of minimum payment can be quite beneficial.

We conclude that the FTC has not identified sufficient evidence to raise serious doubt about the current efficiencies of the IP marketplace. Indeed, the available empirical evidence suggests that these existing rules and practices work well. The interests of consumers are well represented by standard setting organizations and competition among technology implementers who at the end of the day must make goods and services that people wish to purchase.

It doesn’t roll off the tongue quite like the famous Shakespearean line — “to be or not to be: that is the question” — the opening line of Hamlet’s soliloquy in Act 3, Scene 1, but the question that some inventors will ask themselves is whether they should seek out licensing opportunities or follow the path of manufacturing and selling.  Truthfully, many inventors probably don’t ask this question and instead jump past this fundamental question and straight for the licensing revenue, but is that the best thing in the long run?  Licensing takes a lot of work out of the monetization equation and minimizes risk, but foregoing manufacturing and pursuing licensing can significantly cut down on profit realized by the owner of the invention rights.

There are three major things that need to intersect to make a licensable product,” Lambert said. “First of all, you have the patentable side. Either it is patented or patentable, because essentially what we are licensing is intellectual property. Second, is the product marketable, meaning people want to buy it? Does it have unique features that people like, or need, or want. Lastly is it commercially feasible? That means that you can sell it, or make and sell it, for certain margins.

Just like in the story-line of Independence Day, where the alien death ships slowly but surely positioned themselves over each major city, with the eventual outcome well understood, so too is Intellectual Ventures (I.V.) slowly positioning itself as the patent overlord over many major industry segments. Just like in the movie, the eventual outcome is well understood. To wit: Complete usurpation of the U.S. Patent system. The outcome is a ,gigantic tax/toll collector controlling the pulse of innovation in the U.S. or, like the movie, extermination of innovation.

During fiscal year 2009, 596 new companies were formed as a result of university research, which is one more than the 595 formed in 2008 and 41 more than the 555 formed in 2007. The increase, while modest, does come despite a downturn in the U.S. and global economy, proving that even during a down economy good technology and innovation can and does create jobs. The AUTM survey also shows that invention disclosures continue to rise, patent applications are up, and during fiscal year 2009 there was a surprisingly high increase in foreign filings over fiscal year 2008.

How often have you felt you had a great invention that was just what the world was waiting for. Unfortunately, many would-be entrepreneurs are under the illusion that that is all they need for someone to beat a path to their doorstep, big check in hand. If only it were that easy! The average entrepreneur usually does not think about what is really necessary to make their invention a commercial success. As a result, their great ideas often fizzle before they ever have a chance to get to the marketplace.

There is an important role that open source could play moving forward, and that role is to set the foundation of innovation and technology, which is no small task in terms of importance and seems to perfectly fit with open sources strengths. But too many open source regimes are like the Borg of Star Trek fame, or a little like the Mafia. Once you are a member you simply cannot get out. With too many open source regimes once you join and take then anything that you produce must be free to be taken by other members of the consortium. It really is akin to a patent deal with the devil, and ignores human tendencies. Ingrained in almost everyone is a feeling they should be able to profit from their own work, and most would feel injured if they worked and others were allowed to take without some kind of in kind return.

As so many run to condemn patent trolls and would like to compromise the integrity and strength of all patent rights to combat what they perceive as bad actors, I wonder whether patent trolls are really a drag on the high-tech industry. Are patent trolls really costing the industry, or is the industry making much ado about nothing? One theory holds that the tech industry is treating the patent troll phenomenon as nothing more than a nuisance, and a nuisance that is not worth doing anything about. I have for a long time stated that there are obvious strategies that could be employed, but they are ignored in favor of doing nothing. But earlier today I heard an interesting twist. What if they simply don’t want to do anything and they view the patent troll matter as simply a cost of doing business?

Acacia Research Corporation (Nasdaq: ACTG), which in some circles is known as the mother of all patent trolls, announced today that a wholly-owned subsidiary has become the General Partner of the newly formed Acacia Intellectual Property Fund, L.P. The Fund, who together with the subsidiary, have provided a total of $27 million as an initial funding commitment. The Fund is authorized to raise up to $250 million, which should strike fear in the hearts of all of the likely targets of patent infringement lawsuits, namely those that make high tech products.

There are few things in this world that irritate me more than hypocrisy. Did you know that since 1976 Duke University has had 716 issued US patents, 266 of which in some way, shape or form relate to genetics and 156 of which relate in some way, shape or form relate to both genetics AND cancer. While Duke University throws Myriad Genetics under the bus over its patents on the BRCA1 and BRCA2 genes tied to breast and ovarian cancer, Duke has its own patent on identification and sequencing of the BRCA2 cancer susceptibility gene. How convenient!