Business of Law
Tool against ‘trolls’
Posted Mar 1, 2009 10:00 PM CDT
By Richard Acello
Bothered by “patent trolls,” those pesky creatures who wait for inventions to hit the market and then cry, “I’ve got your patent; now pay me”? John Amster says he has a solution.
Amster, an intellectual property lawyer, is a co-founder of RPX Corp. in San Francisco, which buys up patents. For a fee, subscribers get access to all the patents in its portfolio.
“We provide a patent-defense aggregation service,” he says. “We buy a significant volume of patent rights, either actual or potential threats to companies that will be our members. ... [Members] get a license to everything in our aggregation.”
RPX, open for business since September, boasts IBM, Cisco Systems and Epson as clients.
How does RPX know which patents are relevant to clients? “If something’s on the market being shopped by patent brokers and they come to us with a write-up of why your products are infringing on it, that’s a pretty good indication,” Amster says.
In January the firm entered a license agreement with patent portfolio holder Acacia Research Corp. RPX said some defendants in a patent suit Acacia filed could get out of the suit by signing up with RPX.
The cost of membership depends, Amster says, on a company’s revenue.
Scott C. Harris, an intellectual property lawyer in Rancho Santa Fe, Calif., says RPX’s business model may have legs.
“RPX is approaching the nonpracticing entity issue from a new angle,” Harris says. “Overall, this [approach] can reduce the costs to companies caused by their infringement of patents of others. If the model can work, it’s a win-win.”