New Round Set For Google, Ford Patent-Buying Program

By Dani Kass
Law360 (June 4, 2019, 4:25 PM EDT) — An organization that buys patents on behalf of Google Inc., Ford Motor Co., Microsoft Corp., Uber Technologies Inc. and other giants on Tuesday said it’s once again opening up its streamlined patent-buying marketplace.

Allied Security Trust is hoping to expand participation in the Industry Patent Purchase Program by, for the first time, allowing patent owners to continue marketing their inventions elsewhere during the program, the company announced. AST is also explicitly soliciting inventions from a broadened set of technology areas, including LED lighting and semiconductor manufacturing.

“Our members were pleased with the variety of submissions we received last year, where half of our membership participated in the program,” AST CEO Russell W. Binns Jr. said in a statement. “We are looking to build on this success and have broadened our technology areas of focus for submissions to help find more patents of interest across our membership and based on the business objectives of our members.”

AST is a cooperative that buys patents on behalf of its members, which also include Honda Motor Co. Ltd., IBM Corp., Oracle Corp., Philips, SAP SE, Sony Corp., Spotify Technology SA and Verizon Communications Inc.

Under the IP3, first announced in May 2016, patent owners can submit their patents and set a price at which they are willing to sell, with no negotiations. After the submission period, members can then review the offers and decide whether or not to buy them.

Last year, AST spent $3 million on patents during its last round of the IP3 program, its biggest year to date, according to the organization.

This year’s program will allow submissions from July 15 through July 26, and patent owners will be notified if they have a buyer by October, the organization said. AST is looking for patents that fall into a range of areas, including artificial intelligence, automotive, blockchain and financial services, cloud computing, health care technology, internet of things, medical devices and telecommunications.

Binns told Law360 that, in previous years, some patent owners were spooked by the idea of having to take their inventions off the market for months while waiting to find a buyer through IP3. But now the organization is allowing patent owners to shop around until the last 11 days of the program.

AST has said the goal of the program is to acquire solid patents with no validity issues that can be used for defensive purposes. That means IP3 looks for patents that could be asserted against the companies participating, either by the patent owner or by a nonpracticing entity that might acquire them, and mitigates that risk by getting a license.

When a finding of infringement on a single patent can lead to a judgment of many millions of dollars, acquiring and licensing a patent for far less than that far in advance is an attractive prospect for major companies, the organization has said.

–Additional reporting by Ryan Davis and Tiffany Hu. Editing by Jack Karp.