Maintaining low-quality patents isn’t a winning strategy

Getting whatever you can sneak by a patent examiner probably never was a wise strategy, but it is true that there was a time in the industry when patents were viewed as a numbers game. Once upon a time, the patent business viewed patent acquisition, whether by organic growth or outside purchase, as aking to a corporate version of global thermonuclear war. If you want to succeed, the thinking went, you needed to have more warheads (i.e., patents) than your enemies. At times, the quality of those patent assets were considered at best secondary, if not completely irrelevant.

While the size of a patent portfolio isn’t completely irrelevant, it is worse than useless to have a portfolio full of low-quality patents. Not only is there a growing cost associated with obtaining patents in the first place, but there is also a growing cost of keeping patents alive. The seldom told story in the popular press is that many patents do not enjoy the full patent term because there are three separate and increasing maintenance fee payments that must be made to keep the patent alive for its full term. Specifically, maintenance fees are due at 3.5, 7.5 and 11.5 years after a patent has issued. For a large entity, these fees are $1,600 for the first maintenance fee payment, $3,600 for the second, and $7,400 for the third.


Lenovo Buys Mobile Patents for $100 Million from Unwired Planet

Unwired Planet, Inc. (NASDAQ:UPIP) and Lenovo (HKSE: 992) recently announced that Lenovo has agreed to purchase a portfolio of patents from Unwired Planet and to take a term-based license to Unwired Planet’s patent portfolio. The aggregate consideration for the combined transaction is $100 million payable in cash. The transaction is expected to close by the middle of April.

Under the terms of the agreement, Lenovo is now licensed under Unwired Planet’s intellectual property portfolio, which covers standard essential, implementation, and application layer technology for mobile devices. Following the transaction, Unwired Planet’s portfolio will consist of approximately 2,500 issued and pending US and foreign patents. The patent purchase consists of 21 patent families owned by Unwired Planet, including patents for 3G and LTE mobile technologies and other important mobility patents.

“We are pleased to have reached an agreement with one of the world’s leading global technology companies,” said Philip Vachon, Chairman of Unwired Planet’s Board of Directors and head of its Intellectual Property Committee. “We wish Lenovo continued success going forward.”


The Evolution of IP Driven M&A

Today’s IP Driven M&A seminar has kicked off live from San Francisco! The day’s first panel was entitled, “The Evolution of IP Driven M&A”, and featured Chairperson Ron Laurie, Jose A. Esteves, Mark F. Radcliffe, and Kira Kimhi. The panelists discussed the differences between tech patents and life science patents in regards to the roles they play in mergers and acquisitions. They also shared their experiences in the changing patent system and the emergence of strong non-practicing entities.

Here are some of the highlights:

*There are more acquisitions when dealing with life science patents because companies that are built on life science patents can’t really be separated from their patents.  What then happens is that when a buyer looks to purchase the life science patent, they often acquire the entire company as a whole. With life science patents, there is a separation between the patent and the ultimate product, but not really between the patent and the company. Hence, the frequency of acquisitions over mergers. (more…)

Top 5 Patent Law Blog Posts of the Week

Today we continue our weekly installment highlighting the best of the patent blogosphere from the past week. If there are any patent blogs you think should be highlighted by our Top 5, please comment on this post and we’ll check them out.

1) IP Watchdog: Patent Mass Aggregators: The Giants Among Us – Written by guest authors Tom Ewing and Professor Robin Feldman, this post discusses how a handful of entities have amassed vast treasuries of patents on an unprecedented scale. The post points out how it is important to understand the method of organization and the types of activities that are causing a paradigm shift in the world of patents and innovation.

2) Patently-O: New Post Grant Options and Associated Proposed Fees – This post lists the new fees for petition for post-grant opposition or covered business method patent review, a petition for inter partes review, a petition for ex parte reexamination, supplemental examination, derivation, and third party submission of prior art in pending cases. (more…)

Chief Judge Rader to Speak at Patent Law Institute on All-Star Panel!

Patent law heavyweights will convene for what looks to be two very special days in New York City at PLI’s 6th Annual Patent Law Institute on February 16-17th.

 Chief Judge Randall Rader of the Federal Circuit will participate in an all-star dialogue panel between the bench and bar along with United States District Judge William Young and nationally-recognized expert practitioners Donald Dunner, Seth Waxman and Dean John Whealan of the George Washington University Law School.

Robert Stoll, who recently retired as Commissioner for Patents at the USPTO, is slated to open the program with a PTO keynote address. Commissioner Stoll is expected to report the latest developments regarding the PTO’s on-going implementation of the America Invents Act and other critical PTO developments.

Co-Chairs Scott M. Alter (Faegre Baker Daniels LLP), Douglas R. Nemec (Skadden, Arps, Slate, Meagher & Flom LLP) and John M. White (Berenato & White; Director of Patent Professional Development, Practising Law Institute) will navigate attendees through 6 exciting plenary sessions that discuss the practice impacts of recent Supreme Court and Federal Circuit decisions, AIA changes, current critical patent issues from the corporate counsel perspective, views from the District Court bench, the never-ending PTO changes and for good measure, an hour of legal ethics credit! (more…)