IP Market Updates
February 15, 2017
A lot happened since our most recent IP Market Updates on February 3rd. One constant though; we still do not know who the hell is in charge of the USPTO. As of today, the mystery surrounding Michelle Lee’s tenure (or not) is still unresolved and some have even started to question the validity of the patents issued under her signature since her position has been officially tagged as “vacant”. Since most investigative reporters in the US seem to have their hands full elsewhere, it may be a while before we know for sure who steering the ship. In the meantime, former Chief justice Rader has promised -if he is selected- to “make patents great again”…
RPX Corp, the large publicly traded defensive patent aggregator is again in trouble. After being pressured in the past by its activist shareholders for his poor performance and runaway operating costs (someone has to pay for all those expensive patent experts), it announced that its profits dropped 68% in the last quarter. This in turn triggered a request from its CEO John Amster to take the company private. RPX’ board refused and Amster was forced to resign. The main problem with RPX is that it was created at a time when NPE litigation was at a high and its main role was to take the “better” patents off the market before they would be asserted against its members. Now that most NPEs have gone the way of the dodo, there is no bugaboo anymore to wave in front of members to extract those hefty annual dues. Thus the decreasing revenues. Our prediction is that RPX will have, like most NPEs already did, trim its cost considerably and adapt to the new normal where NPE driven litigation is a much smaller fraction of the Courts’ docket.
Others have fared much better; theOttawa based NPE Wi-Lan has just announced that its profits have more than doubled in the last quarter of CY16, despite making some aggressive investments in patent portfolios from the like of Kodak and Global Foundries. A recent licensing deal announced with Micro Semi earlier this month should also help drive Q1 revenues up.
Meanwhile, we are seeing a resurgence of what we call “Privateers” deals, i.e. large technology companies selling their patents to NPEs who will then sue their competitors or other infringers. This is a common (and very hypocritical) stance by the tech industry who vigorously badmouths NPEs in front of Congress and theCourts, but turns to them at the first occasion to assert valuable patents (especially standard essential ones) without the PRstain of having to sue themselves. In that category, we have recently seen new assertion initiated by the Japanese patent sovereign fund IP Bridge using patents it bought from Panasonic and Fujitsu, and from US-based NPE PanOptis, who is suing on patents it acquired from Erickson and (again) Panasonic.
So it is almost refreshing in a sense to see Blackberry (formerly RIM) go to court by suing Nokia directly. It should also be noted that a lot of the most recent cases were NOT filed in the US courts, but either in Germany, Japan or China. No one should need a better sign to conclude that the IP community has lost some faith in the US patent system to fairly protect inventors…
In response to this however, we are seeing a couple of encouraging signs from the adults in the room of the US IP community. First, the Intellectual Property Owner (IPO) Association, which comprises several of the large tech companies, is pushing hard to get a legislative fix to the Court created Mayo-Alice doctrine mess around patent eligibility. It is good to see concrete proposal rather than the perennially flawed anti-troll narrative for once. Similarly, a mix of industry and community leaders have teamed up to create the (Center for the Intellectual Property Understanding (CIPU), a non-profit that aims at bringing a better understand and less confused view of patents as an important property right and an engine for innovation.
Talking of engine, we are firing off on all cylinders so far with the closing of our second sale in 2017, and a few more deals in our sight. Onward!
Other relevant news below.
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Are Patent-Friendly PTAB Decisions On the Rise?
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