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Last month this blog reported on Micron's announcement of a $280 million patent licensing settlement with Samsung. In the same report I wondered whether the NPE Round Rock Research, which by now everyone must know bought a sizeable chunk of Micron's patent portfolio in the autumn of 2009, had anything to do with the deal. Well, if what I was told today by a very good source is correct, the answer is not directly, but quite possibly indirectly. For I understand that Round Rock also concluded a deal with Samsung at the same time as the one with Micron was agreed. And we are not talking about an insignificant sum here: my information is that it could have come in at around $200 million.
Furthermore, Samsung is not the only company that has done a deal with Round Rock. I have been told that Sony, Apple and Nokia have also taken licences from them. On top of that, the NPE is involved in litigation against HTC; this could result in the conclusion of another licensing deal.
When Micron sold its patents to Round Rock it did not issue an 8k or disclose the deal via a press release, which means it did not consider the transaction a material event. It did, however, disclose the $280 million Samsung licensing deal. All of which makes you wonder how much Round Rock bought the portfolio for and whether Micron is taking a share of any money the NPE raises on the back of it. I guess that if you are a Micron shareholder you will be fervently hoping that the company negotiated an ongoing percentage of Round Rock's licensing revenues, especially as Micron has denied having a stake in the NPE.
As for Round Rock, where its founder John Desmarais got the money from to buy the Micron patents has not been made public; though the rumour is that a number of heavyweight investors were involved. If the information I got today is correct, or even close to correct, they could well be reaping the rewards already.
UPDATE: I have received a bit more on the financing behind Round Rock Research. My information, which comes from an excellent source, is that it was organised through a company called Gemas Capital Inc, which was established in June 2009 by Zahid Rahimtoola, who is the chief financial officer of IP Value. In 2009 Round Rock signed a deal with IP Value to help commercialise its patent portfolio. IP Value's two investors are both financial heavyweights - General Atlantic and Goldman Sachs; though whether they backed Round Rock is not known. Whoever did is laughing all the way to the bank if what I have been told is correct. Apparently, they have recouped their money already.
Licensing, IP litigation, Patents, IP business, IP finance