Increasing Litigation Risk with Increasing NPE Activities Exploiting the IoT (Internet of things) Wireless Connectivity Patents
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1) Wireless connectivity is key to enabling the Internet of Things (IoT), and over 10,000 patents related to wireless standards like LTE, WiFi, and Bluetooth were analyzed. 2) Over 3,000 patents held by over 160 assignees were identified as key to wireless connectivity standards for IoT. More than 700 of these patents held by over 30 assignees have potential for litigation. 3) Patent-holding companies like patent assertion entities (PAEs) and non-practicing entities (NPEs) hold most of the high-litigation risk patents, and some patents are being transferred between such companies for purposes of litigation and monetization.
Increasing Litigation Risk with Increasing NPE Activities Exploiting the IoT (Internet of things) Wireless Connectivity Patents
- 1. 1 ©2015 TechIPm, LLC All Rights Reserved http://www.techipm.com/ Increasing Litigation Risk with Increasing NPE Activities Exploiting the IoT (Internet of things) Wireless Connectivity Patents Many market researchers expect that the interconnected IoT devices will create a new market that will result in more than $1 trillion in value added to the global economy within 10 years. Wireless connectivity is the key enabler for the mass deployment of the IoT devices. To assess the potential patent litigation risk for the IoT wireless connectivity, patents that are related to the key wireless standards for the IoT connectivity (LTE, Wireless LAN, Zigbee, Bluetooth, NFC, UHF RFID) are analyzed to evaluate the technology innovation leadership. More than 10,000 issued patents in the US as of 2Q 2015 are reviewed. Patent disclosures in claims and detail description for each patent are analyzed as to whether the contents are within the scope of key technologies for the relevant standard specifications (3GPP, IEEE, ISO, NFC Forum, Bluetooth SIG). For details about the analysis, please refer “Wireless Patents for Standards & Applications 1Q 2015” (http://www.slideshare.net/alexglee/wireless-patents-for-standards-applications-1q-2015). More than 3,000 patents hold by more than 160 assignees are identified as the key wireless standard patents for the IoT connectivity. To assess the potential patent litigation risk, the identified wireless standard patents for the IoT connectivity are further analyzed to figure out the patents that might be exploited for litigation: Patents owned by a NPE (NPE Passive) that may be transferred to other entities that might exploit them for litigation; Patents owned by a NPE (NPE Active) will enforce them; Patents owned by a NPE (NPE PAE) will enforce them for
- 2. 2 ©2015 TechIPm, LLC All Rights Reserved http://www.techipm.com/ monetization purpose; Patents owned by a PE (Privateer) that may be transferred to other entities that will enforce them for monetization purpose; and Patents owned by a PE that are transferred to other entities for the unknown purpose (Suspected Assignment). More than 700 patents hold by more than 30 assignees are identified as the patents that might be exploited for litigation. PE PAEs, NPE PAEs, Privateers, NPE Actives, NPE Passives hold 44%, 31%, 9%, 8% and 7% of the total patents with the potential litigation risk respectively. The IPR share of patents for the Suspected Assignment is 1%. To find a specific patent litigation risk, individual patent with high litigation potential is further researched. One interesting fact is that there were the increasing ownership transfers of patents with high litigation potential to several NPEs for the purpose of monetization. For example, US6519223 (Ericsson: System and method for implementing a semi reliable retransmission protocol) that is a patent used in litigation (Case 6:10-cv-00473, Texas Eastern District Court) transferred to WI-FI ONE, LLC. Other examples are: US8457022 (Nokia: Method and apparatus for providing signaling of redundancy versions) that was transferred to Cellular Communications Equipment LLC is exploited in litigation (Case 2:15-cv- 00581, Texas Eastern District Court); US8411557 (Panasonic: Mobile station apparatus and random access method) that was transferred to Optis Cellular Technology, LLC is exploited in litigation (Case 2:15-cv-00300, Texas
- 3. 3 ©2015 TechIPm, LLC All Rights Reserved http://www.techipm.com/ Eastern District Court); US8935587 (LG Electronics: Method for effectively transmitting control signal in wireless communication system) that is identified as the LTE SEP (Standard Essential Patent) was transferred to Optis Cellular Technology, LLC. Another interesting NPE activity involving high patent litigation potential is the assignment to and from Cluster LLC. Cluster LLC involved in 45 assignment activities as an assignor (assignee: UPIP, WI-FI ONE, Optis Cellular Technology) and as an assignee (assignor: Ericsson, UPIP) as of 2Q 2015. For more information, please contact Alex Lee at alexglee@techipm.com.