Patent News

Oct. 6, 2014

IP Watchdog: Ethical Licensing vs. Bad Practices Damaging the Industry, by Gene Quinn

This post originally appeared in IP Watchdog on October 6, 2014.

Conversant IP is a patent owner that licenses their portfolio to others. They were the first such licensing company to take on the issue of ethical patent licensing. In fact, in November 2013, Conversant IP issued a groundbreaking set of guidelines for ethical patent licensing practices, in an attempt to initiate a discussion within the industry and to distinguish the many licensing entities that are not abusers of the patent or litigation systems. Then in July 2014, the company became the first licensing entities to launch a public awareness campaign.
“Sending ill-founded patent demand letters may be legal, but it’s just plain wrong,” said John Lindgren, President and CEO of Conversant said in July 2014. “This practice is hurting small business owners financially. It’s giving legitimate patent licensing a bad name. And it’s seriously undermining the public’s belief in the U.S. patent system and the value of patents as stimulants to innovation and economic growth.”

What brings this issue back to the pages of IPWatchdog is a recent presentation by Phil Shaer, Senior Vice-President and Chief Licensing Officer of Conversant IP, which occurred on Monday, September 29, 2014. Shaer was a featured speaker at the annual meeting of the Association of Intellectual Property Firms (AIPF), which was held at the Washington Plaza Hotel in downtown Washington, D.C. During his presentation he explained that Conversant IP is wading into the patent troll debate because it is necessary for them, and other licensing companies, to “stand up to the bad practices that are damaging the industry.”

“The fundamental issue is whether the patents are valid, infringed and enforceable, and if they are then we should be having a business discussion,” Shaer explained during his presentation at AIPF. “Ethical patent licensing shouldn’t be any different than ethical legal practice in general.” He would later go on to say, “litigation should only occur as the result of unsuccessful good faith negotiations.”

Acknowledging that many of the problems facing the licensing industry was brought about due to bad actors dominating the discussion, Shaer explained that the absence of legitimate patent owners who license real technologies from the debate has also contributed. Rather than self regulating the industry, legitimate patent owners and licensing entities have stayed in the background, which continues to contribute to the negative public perception of the patent system.