By Richard S. Zembek and George W. Jordan of Fulbright & Jaworski LLP | George W. Jordan III is an IP senior counsel at Fulbright & Jaworski, L.L.P. Specializing in patent litigation and IP due diligence, he frequently writes on patent monetization and validity. He can be reached at gjordan@fulbright.com. Richard S. Zembek is an IP partner at Fulbright & Jaworski, L.L.P. He helps companies protect, enforce, license, manage and secure IP rights. He can be reached atrzembek@fulbright.com. |
After the Nortel patent auction resulting in a winning bid of $4.5 billion and Google’s
announcement that it entered an agreement to acquire Motorola Mobility, along with its sizeable patent
portfolio,
for $12.5 billion in cash, there should be no doubt that patents can be critical business assets of great
strategic
and financial value. This is an opportune time for companies to consider or reconsider how they
monetize their
patent assets, especially in light of the burgeoning monetization services offered to companies by
defensive
patent aggregators (e.g., RPX), advisory firms (e.g., IP Navigation Group and
IPinvestments
Group), investment firms (e.g., Altitude Capital Partners), and market makers (e.g.
, Ocean Tomo).
A patent monetization program is a system for obtaining a return on a company’s
patent
assets. The program permits a company to: (1) better understand competitors and position itself to
defend market
share, (2) enhance shareholder value by identifying potential new revenue streams; and (3)
demonstrate the importance
of investing in patents to management. Consequently, the need for a patent monetization program is
not limited
to companies that do not produce products or that view themselves as licensing companies. Companies
with unused,
redundant, under-utilized, or insufficient patent assets may benefit from the program. Even companies
unc...
