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Owning patents: the new intellectual property battleground

Intellectual property is considered a driving force behind Google's recent purchase of Motorola Mobility for $12.5 billion. In Colorado and elsewhere there has been a mad dash to collect patents, seen as the crown jewel of intellectual property. Google's recent purchase netted 17,000 patents, with another 7,500 pending. Some say Google is playing catch-up, having naively relied previously on its own innovation to gain market share. That made it an easy target for lawsuits claiming infringement of existing patents.

The Google purchase appears to have been priced on a per patent basis, attaching even more value to intellectual property. Others suggest it evidences deficiencies in the patent system itself, forcing companies to pay gargantuan sums of money just to protect technologies they have already developed. Large companies seem to have decided the best way to protect one's business against infringement claims is to own the most patents. Others claim these companies use the patents as a "barrier to entry" for those with new innovations and that is an issue of interest to antitrust regulators.

One problem is that new innovations today often involve small improvements utilizing a number of existing technologies. The issue becomes figuring out who owns the rights if patents already in existence are used to create new innovations. The result is more lawsuits that eventually get settled by cross-licensing deals. This has become a vital battleground because the mobile phone offers a new platform of computing that everyone wants to dominate.

Regrettably, many see the patent office as part of the problem rather than part of the solution. There are many patent applications pending. A three-year backlog has caused lowered standards, resulting in a number of dubious patents. Help is on the way through the America Invents Act, which is pending in Congress. The Act will bring the United States in line with the rest of the world, citing patent ownership will rest with the person who is first to file. Big companies would then have greater legal certainty as to who was the rightful owner of a particular intellectual property innovation.

Patents and intellectual property are highly specialized areas of the law. The issuance of a patent can make or break a business. In Colorado, an attorney devoted to helping individuals and companies protect their intellectual property rights may help plan a roadmap for success.

Source: The Economist, "Inventive warfare Battles over patents are becoming fiercer and more expensive," Aug. 20, 2011

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