Bloomberg BNA’s Patent Trademark & Copyright Law Daily™is the IP industry’s premier news service, offering objective, timely,and reliable daily news coverage and commentary from leading IP law...
By Joseph Marks
June 3— Companies such as Panasonic Corp., Intel Corp., Huawei Technologies Co. Ltd. and Korea Telecom used the brokered patent market to adjust their patent portfolios in the first quarter of the year, according to data provided to Bloomberg BNA by Richardson Oliver Law Group LLP.
The brokered market comprises just a small portion of the overall market for patent sales between companies, but it can offer insights into broader trends.
The number of assets available in the market received a boost in the first quarter. Patent brokers listed over 6,000 new assets, double the nearly 3,000 listed in the previous quarter.
However, those assets were offered as a smaller number of larger packages of patents. The number of packages listed dropped to 164 from 272.
The median asking price for new assets listed by patent brokers was $124,670 during the most recent quarter. That’s up more than 30 percent from the previous quarter and up 13 percent from the first quarter of 2015. The range of asking prices was very wide—more than $9 million between the highest and lowest sums.
Brokers matched buyers and sellers for 13 deals on packages of related patents during the quarter, according to the data. Those deals comprised 594 total assets, 283 of which were granted U.S. patents. The remainder were either pending U.S. patents, or were granted or pending foreign patents.
By comparison, 551 assets were sold in 32 brokered patent deals during the final quarter of 2015. There were 340 brokered assets sold in 37 patent packages during the first quarter of 2015.
ROL Group tracks the reassignment of patents from the various listed packages to identify when a sale is executed. Due to a lag in recording reassignment at the Patent and Trademark Office, ROL Group assumes that a given package is sold if any of the U.S. patents listed in the package are shown as reassigned on the PTO's system.
"The robust brokered patent market continues to supply patents to those who underinvested in specific technologies, while providing a source of revenue for those that overinvested," said Kent Richardson, a partner at ROL Group. "Using the market, CEOs dynamically tune their past technology investments to adjust for their current product roadmaps."
ROL Group advises companies that want to acquire patents and has visibility in much of the brokered market.
Brokers can also help companies acquire patents in fields where competitors and likely legal adversaries operate, giving them defensive leverage if those companies go after them for alleged infringement.
The top brokered market buyer this quarter was Intel, which bought a package of 462 assets from Panasonic in a single deal. Those figures reflect the number of assets Intel bought, not their value.
Many of the granted U.S. patents in that sale likely focused on radio frequency amplifiers, which are used in microwaves and numerous other products, according to data from ROL Group and the PTO.
Panasonic may be shedding unneeded assets as part of its strategic shift away from consumer products and toward enterprise systems. The company is also preparing to invest up to $1.6 billion in a joint venture with Tesla Inc.
Overall, Panasonic has sold nearly 500 patents since the beginning of 2016, including nearly 400 to an organization called Sun Patent Trust, according to PTO data. Panasonic only purchased 26 U.S. patents during the same period.
The second largest asset transfer during the most recent quarter in the brokered market involved Dit-Mco International Corp., a Kansas City-based producer of electrical wire testing products, which was recently acquired by a collection of investment and private equity firms. The company bought a package of 73 U.S. patents and two additional assets from KT Corp., formerly Korea Telecom and South Korea’s largest telephone company.
The third largest volume brokered deal this quarter involved Orange S.A., the French multinational telecommunications corporation, which sold 16 U.S. issued patents to the Luxembourg firm 3G Licensing S.A. Those were likely included in 76 U.S. patents Orange sold to 3G Feb. 12, according to PTO data.
3G’s main business is licensing former Orange patents that are essential or useful for the third-generation mobile communications standards, according to the firm’s website. 3G has purchased more than 400 Orange patents worldwide, according to the site.
Other notable brokered buyers for the quarter include Huawei, which is suing Samsung Co. in the U.S. and China for infringing smartphone patents, and Uniloc Luxembourg S.A., which stepped away from a proposed merger with the patent assertion entity Marathon Inc. in February. The sellers were individuals in both cases.
Defensive patent aggregators were absent from the list of brokered deals during the quarter. That’s a shift from the final quarter of 2015, when defensive buyer RPX Corp. was the largest volume purchaser in the brokered market. RPX bought 102 U.S. issued patents in two brokered deals during that period plus an additional asset.
The defensive coalition Allied Security Trust was the third highest volume brokered buyer that same quarter with 59 total assets, 37 of which were U.S. patents. AST’s members include Google and Verizon among others.
AST did not make any brokered purchases during that quarter.
Asking prices for newly listed brokered assets varied dramatically during the most recent quarter, according to ROL Group data, ranging from just over $8,000 to $10 million.
Minimum asking prices have hovered between $5,000 and $8,400 since the first quarter of 2015, according to the data, putting the $8,000 figure well within range. The $10 million top asking price, on the other hand, is five times the nearest high during that period, which was $2 million in the second quarter of 2015.
The standard deviation for this quarter’s newly listed asset asking prices was $1,157,790.
To contact the reporter on this story: Joseph Marks email@example.com
To contact the editor responsible for this story: Mike Wilczek in Washington at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)