A big high five to Patrick Anderson over at the Gametime IP blog: he has done some deep digging and put together a piece that suggests Micron may not have been exactly candid when its spokesmen told me in June 2010 that it had no on-going interest in Round Rock. You will recall that it was around that time that it emerged that Micron had sold over 20% of its entire patent portfolio to the NPE in a move that it had initiated. This was just a few months after the company’s then CEO told the US Senate Judiciary Committee that as a result of the activities of NPEs:

Companies with a successful history of creating large numbers of jobs here in America through innovative products and services are being forced to divert resources away from innovation and into unjustified litigation and unwarranted settlements. Each diverted dollar means less innovation and less job creation. And the fact that Micron, and the others like us, must factor the costs of unjustified litigation into our product development decisions means that some products will not be brought to market.

Anderson reports that Micron may have received a $400 million promissory note for its patents and has dug up a February 2010 UCC Financing Statement from the company in which the patents are identified as collateral. Furthermore, he has reproduced a January 2012 court filing relating to litigation initiated by Round Rock against SanDisk in which Micron is identified as an entity which has an interest in the outcome of the case. What’s more, Anderson indicates that Intellectual Ventures is a pivotal player in this story – something which he has suggested previously as well.

Given the income that Round Rock is believed to have generated from the patents it purchased from Micron, it has always been a mystery why the company has never publicly disclosed the transaction. If Anderson is correct, it seems that it has certainly earned a great deal of money as a result of the deal and may well be doing so to this day; while it’s also worth remembering that in October 2010 Micron did disclose a $200 million licensing deal with Samsung, which may or may not have been related to its Round Rock tie up.

There is, of course, nothing wrong with patent owners legally cashing in on their rights in any way they see fit: patents are valuable assets that can enhance bottom lines and create significant shareholder value. However, I can’t help feeling that in saying what he did to the senators in February 2009 Steve Appleton obliged the company he ran to spend a lot more time and effort in creating a monetisation strategy than otherwise would have been the case.

I also remember that we probably would have been none the wiser about any of this but for an interview given by Round Rock founder John Desmarais, and I ask myself how many other NPE-slamming operating companies have done similar deals that have flown under the radar screens. It is difficult to believe that Micron is the only one. Maybe, however, the company might want to think about clarifying its position. This blog remains available as a platform should it wish to do so.

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Licensing, IP politics, IP litigation, Patents, IP business, IP finance

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