There has been some fuss in the press about this initiative, launched by Google and targeted at startups.

Basically, it seems to amount to Google giving some of its patents to startups “at no cost”, but subject to a few terms and conditions – and particularly on the condition that these startups participating in the LOT program (a royalty-free patent cross licensing agreement for which participation those small businesses will have to pay fees once two years have elapsed).

For those who don’t know, LOT (“licence on transfer”) is a program whereby the participants (including Google, Canon, Ford and various others) agree that they will grant a licence to each other’s patents if, and when, those patents are transferred to non-participants. The idea behind the LOT program seems to be protection of LOT participants from assertion of patents that have been transferred by other LOT participants to third parties, for example where those third parties are what is commonly known as trolls.

A troll by any other name would smell as sweet

A note on nomenclature; in this article, I intend to use the word “troll” to describe any entity which acquires a patent that it had no hand in originating and which later seeks to licence (or assert) that patent to (or against) a practicing business, without itself marketing the invention claimed therein. Note, though, that subject to the above I regard it as irrelevant for this purpose whether the entity acquiring the patent has (or does not have) any business of its own beyond patent licensing/assertion. In that sense, I use “troll” to encompass what might be called “patent privateer”, “patent licensing entity”, patent assertion entity”, “non-practicing entity”, etc.

A patentee is a patentee is a patentee is a patentee

Google’s program is stated to be driven, at least in part, by the problem of startups being attacked by patent trolls. This is interesting for two reasons.

First, it appears to this commentator that the only trolls that the scheme will provide protection against are those that have acquired their patents from LOT program participants.

Of course, this problem could perhaps be solved by the LOT participants not selling patents to trolls in the first place. However, in this regard, while Google’s material seems to paint a rather dim picture of trolls themselves, it seems more neutral in its description of when “patents are transferred to nonparticipants” by LOT members. And so it should be; why should it make a difference whether those “nonparticipants” intend to market the invention of the patent or whether they are trolls (as we have defined them)? 

It seems to this commentator that if a patentee is fully and properly entitled to sell its patent rights (and all the rights of assertion that go along with it) to whomsoever it chooses, which of course it is, then the inescapable corollary of that is that the purchasing party is fully and properly entitled to buy them and to exercise those rights accordingly, whoever they might be and whatever their business. Those are just two sides of the same coin. But that’s perhaps the topic of another article.

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By heaven, I think my patent’s as sharp as yours!

Second, some of the “fine print” that Google refers to regarding the program states: “Patents obtained…can only be used defensively…you can’t take these patents and just start suing someoneu037e rather, if you are first sued by someone or your products are accused of infringement in a third party litigation, then you’d be free to assert your Google acquired patents counter offensively.”

This seems fine, in principle. Incidentally, it seems also to prevent the startups to whom Google transfers the patents from using those patents in a troll-like manner themselves. However, it is unlikely to be of much practical use against typical trolls, who have no business to speak of (other than licensing/asserting patents), and therefore cannot infringe any patents themselves. Matthew Jones is an IP solicitor and partner a

Matthew Jones is an IP solicitor and partner at EIP, London.

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