Part I of this 2 part series covered a discussion with Matthew Rappaport, founder of IPCheckups, a patent analytics firm which is looking to uncover the super secretive patent portfolio of Intellectual Ventures, a company which may be the largest patent holder company in the world.
After speaking with Matthew, I got in touch with Nicholas Gibson, International Marketing Director of Intellectual Ventures. Specifically regarding the IPCheckups project, he gave the company's official statement. However he was more than happy to answer more 'broad' based questions regarding the functioning of Intellectual Ventures. I present it as follows:
The company's official statement in response to the IPCheckup's IV project:
IV’s patent holdings have been the source of fascination for many years. We and many other patent holders believe that patents should be respected regardless of who owns them. Those interested in viewing granted patents and patent applications can search the USPTO's public database.
Ultimately, we hope to see the day when invention rights are respected whether they are owned by individuals, universities, Fortune 500 companies, start-ups or invention investment firms like Intellectual Ventures.
Other questions:
Swaraj: Your website mentions that you have 40,000 patents and are growing. How does one find out if they may be infringing / want to license any of these patents? Does such a party have to disclose any of their own information to IV in order to find out about this?
IV: Any company selling a technology and wanting to try and check if the product is infringing someone else's patents, need only go to the USPTO (or corresponding websites for the Japan Patent Office, Chinese Patent Office, etc.) and look up patents and publicly available patent applications that fall in the same technology category and class. When they are doing their search for prior art and pre-existing patents in particular fields, they should be looking for the technology represented in the patents, not for who own the particular technology. If IV happens to own one of the patents they discover, by all means please come and talk to us about taking out a license.
In some situations, IV approaches certain companies when we believe that their technology may be infringing one or more patents that we own. Our hope is always to resolve these types of situations amicably, and we are happy to say that we are usually able to resolve these in such an amicable manner.
We would consider taking enquiries from any company that wanted to "check" with IV to see if they were perhaps infringing one of our patents. However, as you suggest, we strongly urge any such companies not to share confidential information with us. If the discussion was serious and there seemed to be a way that we could help, we would want to enter in to a non-disclosure agreement in order to protect the rights of both IV and the company with the technology in question.
Swaraj: Is there any specific purpose behind selecting certain sectors to trade patents in? How do you choose the sectors in which you trade patents in?
IV: We invent and build patent portfolios in areas that we think will be important technological areas for the world in coming years. This means areas that have both technological importance AND a potential market potential. We have a wide range of interests, but we do not invent in every areas of technology. For example, we generally do not invent in areas traditionally the realm of pharmaceutical companies. We are making investment decisions in a wide range of technology areas, much as a venture capitalist does. And similar to a venture capitalist, we understand that not every single one of the areas we are investing in will turn out to be profitable for us. But that is why we maintain a portfolio at scale with diversity- this is a form of investment risk management.
We also have a program called Global Good, which invents technology to solve problems in the poorest parts of the world. Global Good applies the same expertise and resources used in our commercial effort, but focuses on saving lives in the developing world rather than generating profit. For example, the effort includes inventions for malaria prevention, detection and eradication as well as a device to improve vaccination campaigns. More details are available at http://www.intellectualventures.com/index.php/inventions-patents/our-inventions/global-good
Swaraj: There's a lot of talk regarding IV using shell companies. Does IV have any statement about this?
IV: The fact that we use shell companies has generated a great amount of interest, which surprises us. We neither pioneered the use of shell companies to manage our intellectual property assets, not are we as prolific in the use of this tool as many people would like to believe. Our use of so called shell companies has primarily been a tool we use for accounting purposes to help organize the assets we purchase. However, our president Adriane Brown has previously commented that this tool is something that we have been and are moving away from.
Swaraj: Is there anything that you can reveal regarding what IV see as a plan for growth ahead?
IV: IV will continue to invest in new inventions from outside inventors around the world, we will continue to invent on our own. We will also continue to purchase the most valuable patents from others, when it makes sense for our business strategy. This is what we have already been doing for years and we will continue to execute on our business model. We are happy to say that more and more companies are working with us to gain access to the inventions and invention rights they need. Further, more city, state, and national governments around the world seek our advice on building their own long-term intellectual property strategies.
Swaraj: How much of the patent portfolio is created by the in house invention lab, and how much outside? Does the in house lab focus on any specific sectors?
IV: Our in-house invention effort files roughly 500 patent applications per year and has been granted more than 700 patents since we began inventing in 2003 (the remainder are still in the application process....as you well know, the US patent office can sometimes take quite a long time to issue patents). These ideas are generated through invention sessions with our team of 120 elite senior inventors. The lab is actually a separate entity, which works on our inventions when they need additional research or prototyping to prove their viability for commercial or humanitarian use. As one example, our in-house invention team invented a new type of metamaterials-based satellite antenna for broadband access, which the lab then refined and prototyped to prove that the technology could work as a commercial product. That project was then spun out as a separate company (KymetaCorp.com) to commercialize this new antenna technology. Spin-out companies like Kymeta and TerraPower (http://www.terrapower.com/home.aspx)are one way to monetize our portfolio, but our primary focus is on licensing.
As you know, even after applying to the USPTO (for example), patents can take anywhere from 3 to 5 years to issue and so thousands of our patent applications are currently pending. However purchasing an already existing patent immediately places that asset within our portfolio where we can quickly make it available to our customers. Currently, the majority of our portfolio, therefore, consists of patents that we have purchased from others (leading Fortune 500 companies, the world's best universities, start-ups, and individual inventors).
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I would like to thank both IPCheckups and Intellectual Ventures for speaking with us and sharing their views.
SpicyIP has always favoured transparency, and I personally would like to encourage people who believe IPCheckups are helping the patent system by introducing some transparency, to go to their indiegogo crowdfunding page and contribute to show their support.
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