Posts Tagged: "InterDigital"

InterDigital CEO William Merritt writes: “It’s no secret that the regulatory environment is challenging for companies that license patents – in our case, patents that are deemed essential to wireless standards… One of the greatest frustrations for me is that so much of this rests on a bedrock of total miscomprehension of how standards are developed… I met with a reporter for one of the primary tech websites in the world, and he dismissed standards development. It became apparent he didn’t understand how the process worked at all… He didn’t realize that it was private sector companies – companies like ours – that committed significant engineering time and resources, and competed to develop the best solutions, and in so doing committed to licensing them fairly.”

The month of January started off quite busy, which in all likelihood was as the result of deals and announcements either held over or that simply couldn’t get done in the run up to closing out the year. There was a noticeable lull in news and announcements. This month some of the highlights included (1) an exclusive option to license drugs targeting Parkinson’s disease; (2) potential patent problems on the horizon for Facebook; (3) additional settlements in the Forest Laboratory’s BYSTOLIC® patent litigation; (4) the inevitable news from Acacia Research; plus more.

The IP Professional community must find ways to work with Wall Street to help educate and protect the credibility of IP as an emerging asset class, and not allow IP assets to become cannon fodder for deals or the investment “flavor of the month.” The InterDigital-Intel deal can be viewed as call to arms. Wall Street will ultimately choose to enlist or not credible transaction analysis. In most trades there are winners, and sometimes losers. Smart IP bankers will choose to do the homework and not be so quick to determine who, in fact, the beneficial parties are. Given the inefficiencies inherent in the patent marketplace, it is quite possible for a liquidity event like a patent transaction to have multiple winners. Reminding the financial community of this will not be easy.

To me a patent troll is not just someone who has acquired a patent for purpose of licensing or bringing a lawsuit, but rather one who is engaging in some kind of unfair business practice. The telltale sign of a patent troll is one who is abusing the patent right in order to shake down a defendant for payment. This type of behavior is typically exhibited by non-practicing entities who are not innovators, but rather acquire patent rights. However, the act of bringing specious claims to provoke a settlement would, in my opinion, be just as bad if brought by an innovator.