WASHINGTON - To harry other nations without attacking them, monarchs like England's Elizabeth I commissioned ship captains to plunder merchant vessels, creating a type of pirate known as a privateer.
The term is used today to describe businesses that obtain patents from technology companies and then file infringement lawsuits against the sellers' competitors. Tech companies use privateers to distract their adversaries or collect royalties on the patents without provoking retaliatory litigation, said Ron Laurie, managing director of Inflexion Point Strategy in Palo Alto, Calif.
Nokia, Microsoft and Alcatel-Lucent are among companies connected with these licensing firms. Companies that would, in the past, assert their patents in lawsuits only to protect their property now say they work with privateers because they're obligated to make money from past research.
"The moral stigma of being associated with patent assertion isn't what it used to be," said Laurie, who advises companies on intellectual-property purchases. "The whole patent-assertion business is becoming more and more legitimized through these privateering operations."
The practice of selling patents and retaining the rights to share in lawsuit proceeds probably will grow as early innovators in mobile-phone development, such as Nokia and Ericsson, lose market share to the likes of Apple and Samsung Electronics.
It can also make it hard to figure out who actually owns a patent. The U.S. Patent and Trademark Office is discussing possible rules that would require more disclosure about the "real party in interest" in patents and applications.
"Every large company is selling patents today," said Ron Epstein, CEO of patent brokerage Epicenter IP Group.
"When they are selling, they are looking for the best possible price," he said. "Does an intelligent manager of a resource called a patent have a responsibility of getting the highest possible return for these assets, or do they have to worry about how it will harm competitors?"
