Puzzle

Why to acquire patents

Whether the goal is to monetize non-core assets, let someone else assert the patents without any of the risks of retaliation or bring some non-dilutive capital while avoiding the long and expensive march that litigation brings forth, the reasons to sell one’s patent abound.

 

But when you flip the urban legend narrative and look to why someone is looking to acquire, the answer is not always as clear and the reasons will differ from one buyer to another. Here are a few to consider:

  • Avoid a lawsuit:an obvious motivation to acquire a patent portfolio is for an infringing (or soon to be infringing) company to avoid the costs, risks and reputational damages of being sued for patent infringement. This strategy allows the company to obtain a valuable corporate asset (rather than a mere license to practice), which can in turn be monetized if it is also infringed by others. The cost for buying a given portfolio is usually less than it would cost to defend a lawsuit and challenge the validity of the patent(s) in question, without any of the uncertainty built into litigation. In most cases, this is preferable to other alternatives and yet, I am always surprised that so few companies avail themselves of this opportunity. The assets are most always offered at a much lower price than a patent owner will later require taking a license in the context of a lawsuit and don’t forget about the potential for significant damages should it make it all the right to trial.
  • Monetize Assets Directly:This is the classic NPE play. An entity, preferably a well-funded one will essentially become a proxy for the inventor who does not have the appetite and resources to take on large companies that may be infringing its patents.  The NPE takes all the risk, invests millions it may take to drive a successful campaign and, assuming it is successful, shares in the net proceeds with the inventor.  On the other end of that spectrum, we see defensive aggregators buy patents to then license their members and prevent them from being on the receiving end of an assertion claim. Both types of entity play a valid and necessary role in this ecosystem.
  • Acquire Freedom to Operate:  Another solid reason to acquire patents is to dredge a path that will allow an operating company to innovate and bring new products in a given space. This strategy provides piece of mind to the acquiring company, knowing that it can build on a solid IP foundation that will leave it substantially risk free for the foreseeable future. This is particularly well suited for someone acquiring a portfolio of a certain size that is related to a specific area that the company is entering.
  • Build a solid portfolio overnight:It takes well over a decade to organically build a decent patent portfolio. I remember when I joined Microsoft in 1995; despite its size and market dominance at that time, the company was still filing a hundred or so patents a year and only a few of the ones filed in the previous years had already issued. This left the company quite ill equipped when the likes of IBM came knocking at its door to discuss cross patent licensing terms. One way to speed this lengthy process and “bulk-up” rapidly is to acquire strategic patents on the open market, with an eye to portfolios that comprise key assets reading on the most likely competitors or applicable products.
  • Secure International Coverage: Many companies make the same mistake of filing most if not all of their patents in only one main jurisdiction – usually where they are usually located (e.g. US, Germany, etc.). The companies that make it overtime irremediably want to enter new markets and find that their relative IP protection in their domestic market does not extend globally and other patent owners are waiting for them… Acquiring strategic global patent portfolios can provide cover in foreign markets where the company wants to enter. This is why we have witnessed many Chinese companies lately, such as Didi or Oppo, splurge on patent acquisitions with strong international coverage.
  • Diminish The IPO Target: Most fast growing startups (think of all those unicorns) will reach the milestone of going public years before any patent strategy they may have (assuming they even do) has time to materialize. Yet, the moment they announce their upcoming IPO, some smell blood and start asserting their patents while it has some perceived artificial leverage. However, the smart ones make sure they acquire a core foundation of patents before making any such announcement. A good example of this strategy is Uber, which had virtually no patents a few years ago and then embarked on a rather aggressive acquisition program before lifting their foot from the gas pedal about 2 years ago after they had amassed a critical mass of assets in combination with their internal portfolio which was starting to contribute as well. They did this all before they went public.
  • Buy and Hold: Finally, many buyers acquire patents for defensive reasons, meaning they do not really need those rights, but the assets read on some of their direct competitors and they want to have some ammunition should they later face a patent assertion claim from one of them.  Sometimes, they also make the speculative bet that these patents will become quite strategic over time (e.g. Standard Essential Patents) and they may want to have some leverage in the industry.

 

Regardless of why companies acquire patents, there is a need for a more liquid market and more certainty over the asset class. Based on our own discussions with several buyers on a weekly basis and some recent trends (such as fewer IPRs, more favorable rulings in courts, a clear push in Congress to resolve the 101 issue), we predict that transactions will start accelerating again while valuation will continue their upward path. This should be good news, not only for sellers, but also for buyers who should be happy to trade a few more dollars for a more valuable and certain asset.

 

© October 2019 Louis Carbommeau – Adaptation Enric Batalla

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Gran transacción en el mercado de compra-venta de patentes: Cabier Institute vende la patente del Ecómetro a una PAE de California

La patente ha sido cedida a un gran despacho de abogados de Califorbia, que lo licenciará colaborativamente o agresivamente a las principales marcas automovilísticas de EEUU, que estén utilizando la patente. De esta manera, se puede afirmar que fabricantes como Honda, Toyota y General Motors están utilizabdo tecnología española en sus automóviles híbridos desde 2016. El primer titular de esta patente es un inventor de Cabrera de Mar, de la comarca del Mareseme, en Barcelona, que, a través de Iceberg IP la cedió a un pool de empreasrios catalanes que, a su vez, han llegado a un acuerdo con el despacho de abogados. Los términos económicos del acuerdo no pueden ser desvelados, pero han supuesto un negocio con un margen de más del 300% a sus participantes.

Esta noticia encaja con la visión y sentimiento generalizados en Silicon Valley de que las transacciones de patentes vuelven con fuerza, tras un año y medio de «bajón».

polaroid

Cabier Institute adquiere el portafolio Tynax-7000 de patentes de Polaroid sobre codificación y decodificación de señales de vídeo

Cabier Institute acaba de comprar a Tynax Inc., uno de los mayores brokers de patentes mundiales, el portafolio de patentes conocido como «Tynax-7000». Algunas de sus patentes podrían ser esenciales para los estándares MPEG-4, por lo que su valor se incremante cada día que pasa, al ponerse de manifiesto que la tecnología está siendo utilizada sin licencia de la patente. La nueva titular, Cabier Institute («The Barcelona Patent Hub»), la ha adquirido como uno de los primeros portafolios para nuclear un fondo de patentes del que pueda servirse la industria catalana y española para hacer frente a los competidores externos.

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Cabier Institute adquiere la patente del Ecómetro

Cabier Institute ha adquirido la patente US8909482 del Ecómetro a través del bróker británico ICEBERG IP. La patente protege un sistema llamado Ecómetro, inventado por Alberto Masó, de Barcelona, muy utilizado en los coches híbridos, que calcula y displaya el nivel de respeto con el medioambiente en la conducción del automóvil, por ejemplo usado por Toyota, Honda, GM, algunos de cuyos modelos (Accord, Rav4, ´Chevy Malibu) disponen de “Claim Charts.” Cabier Institute está en la búsqueda de compradores o licenciatarios para la patente, gracias a estas “Evidence of Use”, que prueban que la patente US8909482 está siendo muy infringida en USA.

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La «Guía Tynax para la venta de patentes»

Cabier Institute pone a disposición de sus clientes y amigos la primera parte del documento “Guía Tynax para la Venta de Patentes” Este documento es una guía que ayuda a los titulares de patentes a entender el proceso y aspectos relacionados con la venta de una patente. Es aconsejable una información adicional sobre cómo vender una compañía, un producto o una tecnología en desarrollo.

La pregunta clave es: qué se está vendiendo cuando se vende una patente

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Sistema español de patentes, en 7º lugar en el ránking mundial según la US Chamber of Commerce

Según el Indice Internacional sobre IP de la Cámara de Comercio de EEUU de 2017, en primer lugar figura el Reino Unido, seguido por Suiza, Suecia, Alemania, Francia y Japón, y España. Los criterios valorativos han sido varios, entre la confiabilidad del sistema jurídico, la protección del software, la posibilidad de oposición, y la fortaleza de las patentes concedidas. Muy buena noticia para el sistema de patentes y en general la economía españols, en parte debida a la implantación de la nueva Ley de Patentes de 2015.

korean

Korean Sovereign patent Fund Intellectual Discovery offloads a portfolio of 30 patents

Korean Sovereign patent Fund Intellectual Discovery offloaded another portfolio of about 30 assets in the audio coding and processing area to US based company called Unified Sound System.

​A small number of countries have created sovereign patent funds (SPFs) intended to help bolster national innovation and IP ecosystems: France, Japan and South Korea. Could Catalonia be the next to have one?