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IP, IP Asset, Patent

Another Interesting Use Of The IP Auction Marketplace

ICAP announced an offer a Covenant Not to Sue (CNS) from MOSAID Technologies during a sealed-bid auction on September 27, 2011. The CNS covers U.S. patents 5,650,770, 6,198,390, 6,518,889 and 5,963,130, described as “essential to all cellular telephones which implement the Federal Communications Commission’s E-911 emergency call standard.”

The patents have been on an interesting ride, including a write-up in the New York Times back in 2009 when they were being offered in a Pluritas patent auction.  The article mentions settlements with Qualcomm, Motorola, LG and Samsung.  In addition, MOSAID quickly sued HTC and Sony Ericsson after acquiring these patents in early 2011. According to the release, “MOSAID believes that a number of companies that offer cellphones require a license to these patents.”  While it may believe that, I wonder if MOSAID knows what companies those might be.

The assignment history shown above indicates that MOSAID received the patents from “Hawthorne Heights, LLC.”  While Hawthorne itself has virtually no history, the company name did show up under a list of acquisitions by Allied Security Trust.  AST applies a “catch and release” philosophy to defensive acquisition by acquiring patents, licensing them to its member companies, and then selling the patents back to private purchasers.  However, not all members are automatically licensed.  Instead, AST grants a license only to the members that funded the original acquisition.  From a list of acquisitions claimed to be accurate through June 9, 2011:

So what licensing opportunities remain? Consider Research in Motion. RIM is a member of AST, and is mentioned as a specific target in the NYT article, but beyond that there’s no public information about whether or not RIM participated in the AST purchase.  Further, if MOSAID is correct in suggesting that the patents are essential to practicing the E-911 standard, many other companies not lucky enough to join AST might fear the Hobson’s choice between admitting infringement or non-compliance with FCC rules.

Ultimately, the level of remaining interest in licensing the portfolio may very well be unknown, but it won’t be after companies submit their anonymous bids to ICAP.



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