Our current patent system is a mess, many industry observers contend, and the number of patent lawsuits currently underway regarding technology IP borders on the ridiculous. To say that everyone is suing everyone doesn’t feel like much of an exaggeration. Microsoft, Oracle, Apple, RIM, Motorola, Google, and more – all suing or being sued.
For its part, Google has long tried to take the moral higher ground, if you will, criticizing patent trolls (those who buy patents in order to file suits and profit without actually developing the technology themselves). Google has argued that the current patent system stifles innovation. Indeed, the company has found itself on the receiving end of plenty of lawsuits, most notably in recent months, by Oracle, which is accusing Google of infringing on the company’s Java patents in the development of Android.
That history makes Google’s announcement today a little surprising, perhaps. Google says it is spending almost a billion dollars in a bid to acquire patent rights from Nortel, which filed for bankruptcy in 2009.
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Nortel and Google have entered into a “stalking horse” asset sale agreement that will include all of the former’s remaining patents and patent applications for $900 million. This will involve approximately 6,000 patents, spanning wireless, wireless 4G, data networking, optical, voice, internet, service provider, semiconductors and other patent portfolios. According to a statement from Nortel, this “extensive patent portfolio touches nearly every aspect of telecommunications and additional markets as well, including Internet search and social networking.”
Google has called for reform of the patent process, but in announcing the agreement today, Google seems to recognize that while reform is the long-term solution, that stance will do little good in the short-term. “As things stand today,” writes Kent Walker, Google Senior VP and General Counsel, “one of a company’s best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio, as this helps maintain your freedom to develop new products and services.”
Describing itself as a “relatively young company” without a sizable patent portfolio, Walker says that Google hopes that the acquisition of Nortel’s patent will “create a disincentive for others to sue Google.” Hopefully, Walker adds that it will help those involved in projects like Android and Chrome to continue to innovate. Of course, that argument runs counter to what Google has long maintained about the patent process. But if you can’t beat ’em, join ’em.
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