In years gone by, companies with extensive patent portfolios were loathe to sell these assets, strongly preferring to license them. These Patent Licensing Agreements (PLA) came in several flavors, most had some form of royalty payments for the licensor and the fundamental was that ownership of the patents remained with the original owner, i.e., the company granted the patent(s).
While not totally different today, much has changed in the disposition of thousands of US patents. Patents are now sold in much greater numbers than in decades past. Some of the reasons for this are:
· Corporate decision to shut down or sell of an operating division
· Near term need to financially rescue another part of the corporation
· Shift in corporate direction/strategy
· Pay a court imposed penalty
Patent sales are now so commonplace that online IP reporter sites like www.IAM.comrecently devoted a webinarto the patent selling process. This process, as one can see, includes seven steps. The assumption here is that the seller completed a validity check to the extent possible on each patent offered for sale.
It is noteworthy under Step 6 that the biggest buyers of patents review around 1,000 seller packages per year. This clearly puts the onus on the seller to develop a first class patent package. It also suggests that this is a buyers’ market putting more of a burden on the seller to find ways to get the most value for its assets.
Keywords: patent, patent portfolio, licensing, PLA, Patent Licensing Agreement, commercialization.
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