Posts Tagged: "patent license"

LITAN: ”But let’s go back to the main point again from our paper, which is that we need to switch the national conversation about patents to doing a better job of exploiting what we have as opposed to arguing so much about what the standards should be going forward. If we did that, maybe we’d get some greater bang for the buck our of our innovation system. Because there are a lot of unexploited patents out there that could be commercialized. Of course, your point that a lot of patents will drop off because the maintenance fee won’t be paid in the four year period. That’s true for some patents, but certainly not all. In our paper we call the unexploited patents singles and doubles. Our current patent system is set up really only to reward home runs. It’s because of the costs and risks of commercializing the singles and doubles that we don’t see enough of them.”

LITAN: ”Cross industry variation in the use of patents shouldn’t mean that we should just junk the patent system. As I said, the alternatives to go to a system of trade secrets which has very, I think, suboptimal social implications relative to patents. Indeed I think when people object to patents they don’t think about well what else would firms rely on for protecting their hard-earned IP. Indeed, even companies that are heavily involved in the open source world are using patents as a ‘currency’ through which they can achieve collaboration with other firms. That’s why you see big firms like Microsoft and IBM cross license. They do it not only to insulate themselves from infringements against them but because patents are the tickets through which can collaborate with other parties to innovate, make better products and so on.”

Doug Croxall is Chairman and Chief Executive Officer of Marathon Patent Group, which is a patent acquisition and licensing company. I met Croxall in New York City in November 2014 at the IP Dealmakers Forum. Croxall has been successful in the patent monetization business for years and had a unique prospective on patents as an asset. “If you are going invest your family’s fortune, I don’t think you will put all your money in one equity,” Croxall explained on the panel so it is the same thing with respect to an asset or a portfolio of assets.” He would go on to say that Marathon Patent Group has learned from “what worked in other asset areas and applied it to this one.”

“Our promise to the small or medium size operating company is we will give them a simple and affordable way to understand the patent environment they’re doing business in, to find the hundred patents that are most statistically relevant to their product line. And provide them with either a license or a warranty that allows them to reduce the risk they’re facing on those one hundred patents. And if you’re a small or medium size operating company who is coming to understand that every business needs an IP strategy these days as IP becomes a more important part of markets and the economy then this is a very affordable and simple entry level strategy for understanding and dealing with patent risk. And that puts you in a much better position arguably than the position that you’re in right now which is you know very little about the risk you’re facing and you can do nothing about it.”

Recently I had the opportunity to interview Jay Walker, the founder of Priceline.com. Walker, with over 700 patents and pending patent applications, is one of the most prolific living inventors in the world. He is embarking on the monumental task to commoditize patent licenses in a way that streamlines the process, keeps costs down, maximizes the number of licenses and charges a low flat fee. A daunting task no doubt, but his methodology is unique and seems to me to be more likely to succeed than any other efforts, which really bear no resemblance to the Patent Properties model. Still, to call the task difficult is an understatement, but if anyone has the ability to pull it off it would be Jay Walker.

Simply stated, Jay Walker is one of America’s best-known business inventors and entrepreneurs… Recently I had the opportunity to interview Walker, along with the CEO of Patent Properties Jon Ellenthal. While nothing was ruled out of bounds for the interview we spent much of our time discussing his attempt to create a no-fault patent licensing system that will help innovators monetize patents through a uniform licensing regime that offers a variety of peripheral benefits to those who take licenses… In this interview with Jay Walker we discuss his effort to monetize patents, patent trolls, patent reform and the importance of patents in general.

The license agreement grants Reckitt Benckiser Pharmaceuticals Inc., a wholly owned subsidiary of Reckitt Benckiser Group plc, rights for the development and commercialization of XenoPort’s promising oral treatment for alcohol use disorders, a condition affecting more than 140 million people worldwide. Under the terms of the agreement, Reckitt will receive exclusive rights to develop and commercialize arbaclofen placarbil worldwide for all indications, subject to certain rights by XenoPort to negotiate with Reckitt Benckiser Pharmaceuticals on collaborations for non-addiction indications.

This No-Fault licensing system will price its license products based on the likelihood that a company is using a patented technology rather than on a legal standard of absolute certainty… In order to accomplish the ultimate goal, the Patent Utility will select statistically relevant patents for No-Fault licensing by using sophisticated software. The software compares the terms and concepts in millions patent claims in currently unexpired patents against the terms and concepts in the specifications of a company’s specific product line or service. It then scores all 2.1 million unexpired U.S. patents on a scale from 1-100 depending on their statistical relevance to the product or service.

First of all, congratulations! You made The Washington Post and they even spelled your name correctly. Unfortunately, AUTM was specifically called out in an article titled Patent Trolls Have a Surprising Ally: Universities… For a profession that keeps a low profile and goes out of its way not to antagonize people, you may wonder what in the world’s going on that you are gaining such notoriety. The answer is that you are in the sights of several groups who do not wish you well. Some want to weaken the patent system for their short term benefit, some believe society would be better off if inventions were freely available without patents; some don’t think it’s moral for universities to work with industry, and others believe they should determine who reaps the rewards of innovation. While operating on diverse belief systems, they all have one thing in common: they don’t like you.

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.”

As any viewer of “Shark Tank” can attest, the variety of financial arrangements which are negotiated between inventor entrepreneurs and investors is broad. A final agreement is always the result of negotiation between the two parties. Unfortunately, many inventors go into the gunfight with a knife, so to speak, over-matched and under-prepared.