Epson Joins RPX’s Defensive Patent Service

RPX Corporation announced today in a press release that it has acquired a sixth member for its Defensive Patent Aggregation service.  RPX, which acquires patent rights and provides them as a defensive patent aggregation, has also acquired memberships with IBM, Cisco and other large and small technology companies.

RPX’s service was introduced in November 2008, and their management is already responsible for more than $2 billion in patent transactions.  Companies pay an annual membership fee to RPX in order to reduce patent risks and costs created by non-practicing entities (NPEs).  NPE’s, or patent trolls, acquire patents for the sole purpose of offensive licensing against operating companies.  Also, since NPEs do not make or sell products, they are not subject to counter-claims.

The president of RPX, Eran Zur, said “IT companies like Epson have become very common targets for patent assertion from non-practicing entities and RPX addresses the industry’s need for a strong patent defense offering.  We expect that the RPX service will help Epson avoid substantial future litigation and licensing costs.”

RPX Throws Itself Into Patent Infringement Lawsuit

San Francisco-based RPX Corp. has thrown a curveball into a patent lawsuit between Acacia Research Corp. and 20 defendants.  As Law.com reported, Acacia announced on Friday that a subsidiary called Light Valve Solutions reached a licensing agreement with RPX, a company the buys and licenses patents for its paying members.

RPX markets itself as a defensive patent pool, which buys and licenses patents for its members.  The company also promises not to sue for patent infringement.  RPX involved itself in the lawsuit by announcing that the defendants who sign up with RPX get a license to the Acacia patent, letting them out of the suit.  “If they don’t sign up with us, they’re still being sued.  If they get access to this portfolio through us, they’re not just getting access to this portfolio, they’re getting access to everything we have,” said John Amster, a co-founder of RPX.

Many patent lawyers have commented how it’s the first time they’ve ever seen something like this occur.  “I’ve never seen patent rights acquired mid-litigation like this,” said Michael Dorfman, who represents Sanyo, Eiki Internation Inc., and Christie Digital Systems USA Inc.  “I think it presents an interesting business option for companies interested in settling.  It’s a third option that wasn’t available before.”

Will joining a defensive patent pool amid litigation become a common practice?  Maybe not, but in this case it might save companies a great deal of money.

Lawsuits Making You Hot Under the Collar? Jump in the Patent Pool

The Institute of Electrical and Electronics Engineers (IEEE) has announced a two year pilot program with Via Licensing, to aid in the development of patent pools.  The collaboration will encourage intellectual property holders to establish joint licensing programs, through which they can offer licenses and royalty rates for all patents involved in the poll, Cnet News reported.

The roles the two companies will take on have also been defined.  Apparently, Via will facilitate negotiations with the participating companies, while the director of new business ventures for IEEE, Edward Rashba, stated his company’s role would be to “build awareness.”

To put the agreement in simple terms, Rashba said that “if you’re an implementer you have a one-stop shop to get all the licenses you need to develop your product.”  He also said, “We feel we have the opportunity to address some of the key challenges facing the technology industry.”

One of the main problems concerning the technology industry at the moment is the threat of costly patent lawsuits.  Last month we reported on RPX, which is a new company that buys patents with the intent of providing licenses to their clients.  Companies pay an annual fee, and several big names like IBM and Cisco Systems have already signed up.  As far as patent pools are concerned though, they have not proven to be a very common way of alleviating all of the licensing complications.  Only about a dozen high-profile patent pools exist, and eight of them are administered by Via.

Due to the difficulty and the time it takes to develop a patent pool, Rashba stated that the goal of the agreement is to form one patent poll by the end of two years.

RPX Looking To Fend Off Patent Trolls

RPX, a San Francisco start-up, was recently launched with the intent of acquiring patents to shield technology companies from costly lawsuits.  As The Wall Street Journal reports, RPX hopes to keep patents out of the hands of “patent trolls,” who obtain patents for the sole purpose of suing companies for royalties or licensing fees.

RPX is being financed by two venture capital firms, Kleiner Perkins Caulfield & Byers and Charles River Ventures.  While RPX plans to sell membership fees based on a company’s yearly revenue, it is reported that they have already negotiated deals with IBM and Cisco Systems Inc.

So far, RPX has spent $40 million on 150 patents, and they currently have 60 more applications.  However, some worry if this start-up is truly a worthwhile venture.  RPX has reported that they plan on spending $100 million during their first 12 months, and quick math suggests they have spent roughly $190,000 on each patent they already own.  With all of this money being thrown around, one may wonder if RPX will be out of money before they can put a sizeable dent in the patent troll problem.