Letter from AmeriKat II: Good Day Sunshine (patents)

Google's $900 million bid for Nortel's patents

Last Monday Google announced a bid to buy almost 6000 patents and patent applications from Nortel, the bankrupt Canadian telecoms equipment manufacturer, for $900 million. The patents include patents for wireless, internet and social platform technologies. The bid comes as part of Google's strategy to shield itself from patent litigation. The thinking is that if you buy enough patents that cover a wide and diverse range of technologies and industries, you may have a patent in your legal arsenal that may have otherwise been used against you. Google currently possess a comparatively weak patent portfolio in comparison to their market share and expansion into mobile operating systems, especially in relation to android-related technology. Readers may recall that Oracle sued Google last fall for patent infringement of its Java patents by Google's open-source android operating system. (District Judge Alsup, who is presiding over the case, last week received a tutorial in Java. Also, for a fun trade secret case involving HP and Oracle see this recent news here)

Although it was reported that other tech companies were expected to make bids for Nortel's patents, there may be few that can beat Google's incredibly high bid. On Monday, Google's general counsel and Senior VP Kent Walker(picture, left) wrote on Google's blog that

"... one of a company’s best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio, as this helps maintain your freedom to develop new products and services. Google is a relatively young company, and although we have a growing number of patents, many of our competitors have larger portfolios given their longer histories.

So after a lot of thought, we’ve decided to bid for Nortel’s patent portfolio in the company’s bankruptcy auction. Today, Nortel selected our bid as the “stalking-horse bid," which is the starting point against which others will bid prior to the auction. If successful, we hope this portfolio will not only create a disincentive for others to sue Google, but also help us, our partners and the open source community—which is integrally involved in projects like Android and Chrome—continue to innovate. In the absence of meaningful reform, we believe it's the best long-term solution for Google, our users and our partners."

The planned sale of Nortel's patent portfolio must first beapproved by judges overseeing Nortel's bankruptcy cases in the US and in Canada. As reported by Bloomberg, anyone planning to beat Google's offer has to beat it by at least $25 million more than Google's initial offer, or at last count, $5 million more than the last offer. Anyone have $905 million to spare? The AmeriKat wonders what the return on investment is on purchasing a patent portfolio which with patents and/or applications that will have only about 20 or so years of life in them? Will Google ever make back theri $905 million on savings to legal fees or from patent damages? Or does that even matter as long as Google is sending a message to would-be plaintiffs that their patent portfolio is now robust, so sue at your peril? What do readers think?

US and UK unite for some more sweet patent harmony

David Kappos's UK harmonization tour last week not only yielded a Monday morning breakfast at UCL, but progress on the UK and US's joint action plan to combat the problem of patent backlogs and their effects. The joint announcement was made by Kappos and Baroness Wilcox, (compare the IP experience) Kappos stated that:

“The joint action plan highlights that while 21st century patent challenges are global in scope, so too are their solutions. Work sharing is a powerful tool that equips examiners to extract value from our skilled colleagues in other patent offices. By reducing redundant workloads and chipping away at the backlog, we can collaborate to unleash millions of jobs lying in wait and breathe life into our economies.”

The action plan is designed to allow an examiner in one office the ability to reuse work already done by an examiner in the other office on a corresponding applications, as much as possible to avoid duplication of work.

Kappos was also interviewed by The American Lawyer recently regarding the recent patent reforms (read interview here) and the America Invents Act (see recent AmeriKat posts here). When asked whether he thought it was that the House would pass a similar bill, Kappos replied:

I am off-the-charts optimistic.

The AmeriKat loves the enthusiasm.

Three Heads, one mind

It was soon apparent that the three Heads
were in congenial agreement with one another

It's a busy day for tytoc collie, so he has popped in and out of the first Managing Intellectual Property International Patent Forum (here) this morning rather than sitting there, glued attentively to the succession of stellar speakers.  The one thing he did attend in its entirety was the press briefing which three talking heads --  USPTO head David Kappos, UK IPO Head John Alty and his colleague, Patent Head Sean Dennehy -- gave to a small but select gathering of press representatives (there were no coffee facilities).

It was soon apparent that the Heads were not invited there in order to air their differences -- their peaceful messages of global harmonisation, cooperation and mutual respect could scarcely be mistaken for anything else. They spoke eloquently on the need to cut the pendency of patents in the pipeline, bust the backlog, generally build up trust and find ways of letting their examiners into each others' computer systems withou too much regard for hierarchies and passwords.

In answer to a question from this Kat about his beloved Peer-to-Patent experiment (currently running in the USA and Australia and, er, not quite in the UK), David Kappos described as "poppycock" the notion cherished by some European Patent Office examiners that the contribution of members of public towards the identification of significant prior art would result in the loss of their jobs, or of their promotion prospects.  Despite having recruited 1,000 new examiners this year, there was no way that the USPTO could swiftly process the half a million applications they were expecting in 2011: "Peer-to-patent is not a substitute for examiners, but assists them", he emphasised -- and there would be no diminution of their sovereignty [Says Merpel, 'sovereignty' is an interesting choice of word, which actually reflects quite well the feeling one gets about certain patent-examining and granting offices].  The current US legislative bill would take Peer-to-patent within the USPTO, so that it could effectively orchestrate crowdsourcing within the system, without prejudice to any crowdsourcing that might be brought to bear outside it.  As for the UK, "We're following in Dave's footsteps", John Alty said.

Managing Intellectual Property's James Nurton asked about the possibility of a global patent system and mutual recognition.  "At this stage this would be A Bridge too Far", said David Kappos, displaying his erudition as a movie buff -- but it wasn't too too far. He also didn't say that the increasing use of bilateral agreements was not the consequence of a failure to achieve broader consensus, pointing out how useful they were in enhancing cooperation between offices and building trust.  Agreements for Patent Prosecution Highways could also be broadened from bilateral to plurilateral in their scope, by the simple expedient of admitting more countries to them.

Finally, what did the team think of the need for more dialogue between patent-granting bodies on the one hand and patent-exploitation-regulating bodies on the other, such as competition authorities?  Virtually painting an image of the lion lying down with the lamb and the little child playing by the viper's nest, David Kappos related how the USPTO had participated in the first ever conference with the Department of Justice and the Federal Trade Commission for exactly these purposes, as could be seen from the current USPTO guidelines on 35 US s.112, which he described as an "outgrowth" of this event.   John Alty confirmed that the Hargreaves Review had been asked to look at the tension [the politically correct term is not tension, but 'interaction'. Thanks, John, for calling a spade a spade] between IP and competition law. Soon we shall know what it saw ...

At this point, no doubt correctly suspecting that the Kat had another 37 questions to ask, James Nurton thanked the Heads and graciously led them to safety and towards the smell of coffee.

David Kappos comes to town!

INSTITUTE

The Directors Roundtable Institute,

with the cooperation of the IPKat,

invites you to attend a programme

for Boards of Directors and their Advisors

A DIALOGUE WITH DAVID KAPPOS

DIRECTOR OF THE U.S. PATENT & TRADEMARK OFFICE

Monday, 4 April 2011, 8:30 to 10:00 A.M. (8:00 A.M. Registration)

UCL Faculty of Laws, Bentham House, Endsleigh Gardens, London WC1H 0EG

There is NO FEE to attend and continental breakfast will be served.

*CPD Credit of 1.5 hours will be provided.

The event will be chaired by Lord Justice Jacob, Sir Hugh Laddie Professor of Intellectual Property, University College London.

AGENDA

The top official of the US Patent & Trademark Office will discuss key policies of the US Government regarding intellectual property including current patent filing and approval rules, and trade mark regulations.  He will be joined by a British government official, lawyers, and other experts regarding both UK/EU policies and American/European court decisions.  In addition, the speakers will analyse multi-national patent and trademark rights and litigation. 

The Directors Roundtable Institute is a not-for-profit which organizes worldwide programming for Directors and their advisors.  


tytoc collie weblog works for the intellectual property community and welcomes this initiative from the Directors Roundtable Institute.

REGISTRATION:  To register, log on to the Directors Roundtable Institute’s Website www.directorsroundtable.com and click on "Current Events and Registration". 


To contact the Directors Roundtable Institute, call Karen Todd at (727) 493-2067 or email to Jack Friedman, Chairman of the Directors Roundtable, at karen.f.todd@gmail.com.

*IBIL and AIPPI United Kingdom are proud to be providing this event with Directors Roundtable Institute.  AIPPI United Kingdom is accredited under the Solicitors Regulation Authority’s and the Bar Standards Board’s CPD schemes.  SRA CPD Reference Provider DKV/AIPP.  CPD credit 1.5 hours


tytoc collie has had a fair bit of fun over the past few days, speaking to various sweet souls and dignitaries in order to help make this event happen at short-ish notice. He both hopes and believes that it will be well attended.

David Kappos's official website and biographical details can be found here. Director's Forum is his public blog.  He also features on Wikipedia here.