Tomorrow, Google will open up a new avenue for patent owners to wave off patent trolls. But does the move spring from love or greed?
From May 8 to May 22, Google will be accepting applications for its new Patent Purchase Program, where companies and individuals can name their price for Google to buy their patents off of them. But some worry there may be more at stake for Google than purely altruistic motives, and they may be right. But it could still be a good deal.
Google announced the program on their blog, as a way to sooth the current patent marketplace.
“Patent owners sell patents for numerous reasons (such as the need to raise money or changes in a company’s business direction). Unfortunately, the usual patent marketplace can sometimes be challenging, especially for smaller participants who sometimes end up working with patent trolls,” said Allen Lo, deputy general counsel for patents, in the blog post. With this program Google hopes to keep patents out of the hands of patent trolls, also known as “non-practicing entities” (NPE) who enforces patent rights in an attempt to collect licensing fees.
“Then bad things happen, like lawsuits, lots of wasted effort, and generally bad karma. Rarely does this provide any meaningful benefit to the original patent owner,” continues Lo. “Hopefully this will translate into better experiences for sellers, and remove the complications of working with entities such as patent trolls.”
The post of course notes that there are some limits and fine print that applicants will want to make themselves aware of (non-expired, U.S. patent holders only for now, for instance), and also advise any interested parties to make sure they consult an attorney. And depending on who you ask, this could be a golden opportunity or a trojan horse.
While some have remarked that Google seemed like a safe choice, given their long-standing calls for patent reform, Jessica Gutierrez Alm noted in a post for DuetsBlog that it seemed like a potentially dubious deal:
While Google holds itself out as strongly against the traditional patent system, it continues to amass an enormous patent portfolio for itself. In 2014, Google earned the 8th-highest number of patents from the U.S. Patent and Trademark Office, for a total of 2,566 U.S. patents. When Google purchased Motorola in 2011, discussions focused on the valuable patent portfolio Google obtained in the deal. In recent years since the Patent and Trademark Office instituted a “fast track” program by which applicants can pay fees in order to have their patents cut in line and be examined more quickly, Google has utilized the program extensively in order to push its patents through the system. In 2014 for example, Google obtained 875 patents through the fast track program.
Despite Google’s long history of lobbying for patent reform and even pledging many of its software patents as open-source, it has been accused of patent trolling in the past. So is this new program just another way to obtain more intellectual property, disguised as good karma and a contribution to patent reform?
Accusations most notably came to Google after they purchased Motorola Mobility in 2011, pledging to “intensely” defend its mobile OS from Apple, Microsoft and other tech giant’s “strangle” of Android. When Google ultimately sold Motorola Mobility to Lenovo, they held on to a large majority of the company’s patent portfolio.
But it’s possible that Google’s providing relief to the patent market is, at least in some way, beneficial for everyone.
Firstly, because not everyone who has a patent is looking to use it—and that doesn’t make them a patent troll. It’s the same problem Michael Renaud, Jack Schecter, and Robert Moore of Global IP Matters had with John Oliver’s “Last Week Tonight” take on patent trolling; it ignores the past few years of patent reform that has gone on in the U.S.:
John Oliver, like many comedians and Congressmen, attaches the epithet “patent troll” to a broad class of actors, namely, any patent owner that asserts patents that it does not practice in the course of making something. John Oliver suggests that, because a subset of these actors engages in unfair or deceptive practices, the entire class should pay the price. This is at odds with most notions of fairness, as well as a system of property rights that has served the U.S. economy well since the Eighteenth Century.
Restricting patent rights to practicing entities would exclude some of the most innovative segments of U.S. society: universities, those that lack the capital to manufacture products that practice their patents, and even — famously — Thomas Edison. As the Government Accountability Office (“GAO”) found, “[h]istory is filled with examples of successful inventors who did not develop products based on the technologies they patented.”
…In an economy as specialized as ours, it makes little sense to require every innovator to be a manufacturer or else risk relinquishing the rights to their innovations. Those that excel at innovation should be entitled to focus on doing so without diverting their attention.
Given that backdrop, it’s possible that Google is trying to pick up the slack by honestly filling the void that would be filled by patent trolls. And though Google’s methodology for selecting and critiquing the patent sales applications it will receive remain largely in the dark, they have made one thing startlingly clear: The tech giant promises to grant a non-exclusive, non-transferrable, non-assignable, non-sublicensable license to the patent holder.
Now while that many qualifiers normally means a crummy deal, in this case if the patent holder still hopes to make use of the ideas this is a dream come true. If their deal is accepted by Google, the patent holder won’t retain the right to license their invention to someone else but they could still make something of it themselves. It could be a sweet deal for universities, or anyone else who filed a patent claim but doesn’t necessarily have plans to use it.
So it’s true, Google’s foray into the patent buying world could be part of the effort to grow its burgeoning patent portfolio for defensive purposes in the war of the digital roses. But that doesn’t necessarily make it a bad option for patent holders looking to capitalize on their investments.