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A hook-up with team behind Micron NPE Round Rock is Alcatel-Lucent's latest foray into IP sales

Alcatel Lucent may have made another big privateering play. A brief press release issued by Sound View Innovations LLC states that it “has acquired approximately 500 Alcatel-Lucent patents in force worldwide, with the majority of the acquired portfolio in the United States and Europe”. These cover “a broad range of technologies relevant to social media, content distribution, and distributed computing”.  

A quick perusal of the USPTO database indicates that the assignments actually took place in mid-January, and that many of the patents involved were originally filed in the 1990s. This may imply that Alcatel is looking to see whether it can get one final payday out of them; or – perhaps – that they are thought to be foundational rights that could read on an awful lot of stuff currently being made and used out in the big wide world.

That we may be looking at the latter scenario becomes more plausible when you discover just who is behind Sound View. The firm’s website does not contain a great deal of information, but it does reveal its executives: Gerard A deBlasi, President and Chief Executive Officer; David V Elkins, Chief Financial Officer, Treasurer and Controller; K McNeill Taylor Jr, Vice President, Law and General Counsel; and James E. Burris III, Vice President, Licensing. Many of the readers of this blog may recognise these individuals as senior members of the management team at Round Rock, the NPE established at the instigation of Micron back in 2009 and which has since done very well out of monetising the patents it received from the company. Indeed, Round Rock and Sound View share the same New Jersey address.

If the rumours are right and Round Rock has been bankrolled by major players on Wall Street in the past, it is possible that these same entities have played a role in doing this deal with Alcatel. That, of course is speculation; but what we can say with a fair amount of certainty is that a firm like Round Rock would not purchase patents on the off-chance they may reap some rewards. To get involved, they would have had to have had a fairly high expectation of future success.  

Alcatel finalised a $2.1 billion loan from Credit Suisse and Goldman Sachs in December 2012, secured against, among other things, its 29,000 strong patent portfolio. Since that time it looks to have done at least two other privateering-style deals – with Vringo and Wi-Lan - in addition to the one with Sound View. Speaking at the IPBC Asia in Singapore last November, the company’s senior VP of IP Craig Thompson stated that the banks get a percentage of every licensing deal that Alcatel agrees. Whether this happens with sales as well is not known, but privateering does allow the seller to retain an ongoing interest in royalties that the buyer generates. This is something that Micron seems to have benefited from since its patent sale to Round Rock. For its part, Goldman Sachs was one of the organisations behind the creation of IP Value back in the early 2000s.

Joff Wild
IAM Magazine
14 February 2014

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IP management, Licensing, IP litigation, Patents, IP business

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