Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

So, China - Buyers Sellers Litigation

55 views

Published on

Update on IP in China: Who’s Buying, Selling, Asserting, and Update on PAE Litigation

Published in: Law
  • Be the first to comment

  • Be the first to like this

So, China - Buyers Sellers Litigation

  1. 1. Business Sense • IP MattersBusiness Sense • IP Matters 1 So, China Kent Richardson, Richardson Oliver Law Group Ray Strimaitis, AST Contact Information: +1 (650) 967-6555 info@richardsonoliver.com
  2. 2. Business Sense • IP Matters Agenda Attorney-Client Privileged & Confidential 2 The really big picture Secondary market Litigation Licensing
  3. 3. Business Sense • IP Matters Context: Jurisprudence Information Access Attorney-Client Privileged & Confidential 3 46,673,153 OpenLaw.cn “NGO open organization for lawyers, judges, prosecutors, law teachers, scholars, students, and law-related staff.” 47,000 court court cases, papers, comments
  4. 4. Business Sense • IP Matters PACER °$.10 per page … Attorney-Client Privileged & Confidential 4
  5. 5. Business Sense • IP Matters Attorney-Client Privileged & Confidential 5 131K Reddit upvotes for Frida
  6. 6. Business Sense • IP Matters Jurisprudence Information Access Attorney-Client Privileged & Confidential 6 OpenLaw.cn “NGO open organization for lawyers, judges, prosecutors, law teachers, scholars, students, and law-related staff” 47M court court cases, papers, comments Search 3,550 courts 344,869 judges 32,171 law firms 441,703 lawyers
  7. 7. Business Sense • IP Matters Context: Fun Facts °2017 numbers °Invention patent applications: 1.38M °Utility model: domestic 1.7M, foreign 8K °Are we doing something wrong? °Where are we °Software – like the EU, no Alice °Genes – OK, no Myriad °Injunctions – OK, no eBay °* Attorney-Client Privileged & Confidential 7 Slide content used with permission from Dr. James Zhu, JunWe LLP When are we?
  8. 8. Business Sense • IP Matters Context: Fun Facts °2017 numbers °Invention patents: 1.38M °Utility model: domestic 1.7M, foreign 8K °Are we doing something wrong? °Where are we °Software – like the EU, no Alice °Genes – OK, no Myriad °Injunctions – OK, no eBay °It’s like 1999 Attorney-Client Privileged & Confidential 8 Slide content used with permission from Dr. James Zhu, JunWe LLP When are we?
  9. 9. Business Sense • IP Matters Agenda Attorney-Client Privileged & Confidential 9 The really big picture Secondary market Litigation Licensing
  10. 10. Business Sense • IP Matters What’s the Secondary Patent Market? 10 Seller Buyer Copyright 2017 ROL
  11. 11. Business Sense • IP Matters What Is in a Brokered Patent Package? • List of patents for sale, applicable market, infringement analysis (claim chart), background on the seller • Asking price, bid dates, special circumstances (license back, specific encumbrances) Typical package • Confluence Patent Portfolio • Single family (15 US Patents and 7 open applications) relating to social network data aggregation. • 2006 priority date. • Received July 2013 • Sold October 2014 • Asking prices: “7 figures” • Multiple claim charts presented for • Apple • Google • Facebook • Purchased by an operating company • Fingerprint Cards AB Example package from Patent Profit (Will Plut) 11Copyright 2017 ROL
  12. 12. Business Sense • IP Matters $0 $2 $4 $6 $8 $10 $12 $14 2011 2012 2013 2014 2015 2016 2017 2018 $12.5B in Patents Offered on the Secondary Market 12 Cumulative sum of asking prices of 110,000 plus patent assets in 119 technology categories Copyright 2017 ROL Unsold Sold Billions of dollars of unsold patents on the market. Litigation risks continue to increase $B
  13. 13. Business Sense • IP Matters Worldwide Distribution of Brokered Assets Attorney-Client Privileged & Confidential 13 US is still the biggest market China is coming up fast
  14. 14. 14 38 66 55 42 27 44 80 82 32 62 34 41 33 63 99 103 0 20 40 60 80 100 120 2010 2011 2012 2013 2014 2015 2016 2017 PATENTDEALS DEAL RECORD YEAR PATENT DEALS BY YEAR Sellers Buyers 82 Sale and 103 Purchases in 2017 by Chinese Companies AST ConfidentialSource: USPTO Assignment Analysis by AST, 2010-2017
  15. 15. 15 254 753 426 222 216 562 609 357 377 629 456 895 298 904 2635 1121 0 500 1000 1500 2000 2500 3000 2010 2011 2012 2013 2014 2015 2016 2017 TRANSACTEDUSASSETS DEAL RECORD YEAR TRANSACTED US ASSETS BY YEAR Sellers Buyers 2016 saw major patent purchases by Chinese companies AST ConfidentialSource: USPTO Assignment Analysis by AST, 2010-2017
  16. 16. 16 Top Deals involving Chinese and Taiwanese Companies No Seller Name Seller Country Buyer Name Buyer Country Deal Year US Assets 1 Microsoft USA Xiaomi Technology Co Ltd China 2016 560 2 Seiko Group Japan BOE Technology Group Co Ltd China 2016 425 3 NEC Corp Japan Foxconn Taiwan 2013 356 4 Intel USA Xiaomi Technology Co Ltd China 2016 333 5 Quarterhill Inc Canada TSMC Taiwan 2017 273 6 RPX Corp USA HTC Corp Taiwan 2013 231 7 Formosa Plastics Group Taiwan Intel USA 2015 191 8 Vanguard International Semiconductor Taiwan TSMC Taiwan 2011 178 9 Broadcom Ltd USA Pixart Imaging Inc Taiwan 2016 161 10 Hewlett Packard Co USA HTC Corp Taiwan 2012 156 11 Toshiba Corp Japan Alpad Corp China 2017 153 12 Alien Technology LLC USA Ruizhang Technology Ltd Co China 2015 151 13 Xperi Corp USA Shenzhen O-Film Tech Co Ltd China 2015 139 14 ADC Telecommunications Inc USA HTC Corp Taiwan 2011 135 15 GE USA BOE Technology Group Co Ltd China 2016 131 Source: USPTO Assignment Analysis by AST, 2010-2017
  17. 17. Business Sense • IP Matters Agenda Attorney-Client Privileged & Confidential 17 The really big picture Secondary market Litigation Licensing
  18. 18. Business Sense • IP Matters Interesting Results in Chinese Patent Litigation Win rates 2014 - 72% win for invention patents 77% for utility models Chinese government is pushing courts to protect IP rights Damages 30K US dollars – mean. 8K US dollars – median Probably double today Injunction is 84% Invention patents 94% Major reason for not issuing injunction Patent expired Plaintiff did not ask one >95% Major tech General - 84% Electrical - 14% Chemical - 1.5% NPEs Damages are so low, so not a big concern yet Lots of individual patent holders in China Attorney-Client Privileged & Confidential 18
  19. 19. Business Sense • IP Matters Research is in and Its Good for Patent Holders °Prof. Brian Love “Pat. Lit. in China” (Feb. 2016) °2006-2011 471 pat infringement cases (no UM or design) °USPTO & UC Berkeley Law School (Nov 2017 & Jan 2018) °IP Courts are plaintiff-friendly and neutral to foreign °Beijing IP Court (11/6/2014-6/30/2017 case summary) °P(domestic) 106 cases 82.2%; P (foreign) 10 cases 76.9% Attorney-Client Privileged & Confidential 19 Source: Dr. James Zhu, JunWe LLP
  20. 20. Business Sense • IP Matters Privateering Comes to China Attorney-Client Privileged & Confidential 20
  21. 21. Business Sense • IP Matters Privateering – A Footnote So, privateering, ultimately not so popular Treaty abolishing privateering in 1856 “By the end of the 19th century the practice … had fallen out of favor because of the chaos it caused and its role in inadvertently encouraging piracy” Attorney-Client Privileged & Confidential 21
  22. 22. Business Sense • IP Matters Privateering – A Footnote Attorney-Client Privileged & Confidential 22 … because of the chaos it caused and its role in inadvertently encouraging piracy
  23. 23. Business Sense • IP Matters Agenda Attorney-Client Privileged & Confidential 23 The really big picture Secondary market Litigation Licensing
  24. 24. Business Sense • IP Matters Take-Aways °Be prepared to be surprised °Our views on intellectual property protection do not always translate – we need to adapt °What’s a good deal here may not be a good deal there and vice versa °Expect more deals, more litigation Attorney-Client Privileged & Confidential 24
  25. 25. Business Sense • IP Matters Multiple Sellers and Buyers 2016 - 2017 Top Sellers by Package Count Aaron Emigh Allied Security Trust (AST) ATT Clifford Sweatte Cypress Semiconductor Corporation Foxsemicon Integrated Technology, Inc. Hewlett Packard Enterprise (HPe) Honeywell International Inc. Huawei Technologies Co. Ltd. IBM Intel Corporation MITRE Corporation Panasonic Corporation Rovi Corporation (Before Tivo acquisition) RPX Satyajit Patwardhan Sergey Mavrody Siemens Silent Communication Ltd Verizon 26 Top Buyers by Package Count Allied Security Trust (AST) Apple Inc. Beijing Xiaomi Mobile Software Co., Ltd. Belisso Llc Blackbird Tech Llc Cria Inc. Empire IP, LLC Entit Software Llc Google Inc. Huawei Technologies Co., Ltd. Insight Interfaces Llc Intellectual Ventures Knapp Investment Company Kudelski SA Marking Object Virtualization Intelligence, Llc Microsoft Corporation Mobile Synergy Solutions, LLC (Monument Patent Holdings subsidiary) Copyright 2017 ROL Top Buyers by Package Count Munitech Ip SARL Nuance Communications, Inc. Open Invention Network, Llc Optimum Communications Services, Inc. Pathunt Ip Management Limited Rakuten, Inc. Regional Resources Limited RPX Servicenow, Inc. Sk Hynix Inc. Spectrum Patents, Inc. Taiwan Semiconductor Manufacturing Co., Ltd. Twitter, Inc. Uber Technologies, Inc. Uniloc Luxembourg S.A. Vector Capital Corporation
  26. 26. 27 Top Chinese Sellers by Number of Patent Deals during 2015-2017 Seller 2017 2016 2015 Total Since 2010 Foxconn 1 5 6 17 Industrial Technology Research Institute 4 2 3 27 Huawei Technologies Co Ltd 1 3 2 8 Lite-On Technology Corp 0 2 2 12 National Tsing Hua University 1 2 1 5 MiTAC-SYNNEX Group 2 1 0 5 Chinese Academy of Sciences 2 1 0 3 Nine Eagles Electronic Technology Co Ltd 2 0 0 2 Shenzhen University 1 1 0 2 GCSOL Tech Co Ltd 1 1 0 2 Delta Electronics Inc 1 1 0 2 Foxsemicon Integrated Technology Inc 0 0 2 2 Zephyr Technology Co Ltd 0 2 0 2 Integrated Digital Technologies Inc 0 2 0 2 Qisda Corp 1 0 0 8 Total Chinese Sellers 82 80 44 434 Source: USPTO Assignment Analysis by AST, 2010-2017
  27. 27. 28 Top Chinese Sellers by Number of Transacted Assets during 2015-2017 Buyer 2017 2016 2015 Total Since 2010 Formosa Plastics Group 0 0 191 191 Foxconn 6 25 119 315 Wistron Corp 0 106 0 106 Hanergy Thin Film Power Group Ltd 0 104 0 104 Ubeeairwalk LLC 0 0 70 70 Industrial Technology Research Institute 42 7 4 199 WALTOP International Corp 0 0 48 48 Chunghwa Picture Tubes Ltd 0 37 0 105 Hwz Intangible Assets Investment Management Ltd 0 37 0 37 Huawei Technologies Co Ltd 4 21 9 70 MiTAC-SYNNEX Group 2 29 0 41 Coolpad Group 31 0 0 31 Lexvu Opto Microelectronics Technology Co Ltd 0 31 0 31 Zhen Ding Technology Co Ltd 27 0 0 27 Grenergy Opto lnc 24 0 0 24 Total Chinese Sellers 357 609 562 3399 Source: USPTO Assignment Analysis by AST, 2010-2017
  28. 28. 29 Top Chinese Buyers by Number of Patent Deals during 2015-2017 Buyer 2017 2016 2015 Total Since 2010 Huawei Technologies Co Ltd 3 8 8 32 TSMC 2 12 5 31 Xiaomi Technology Co Ltd 2 2 4 8 Epistar Corp 3 0 1 8 Pixart Imaging Inc 1 2 0 5 YFY Inc 1 2 0 4 TCL Corp 0 1 2 4 Pathunt IP Management Ltd 2 1 0 3 BOE Technology Group Co Ltd 0 2 1 3 Hikvision Digital Technology Co Ltd 0 2 1 3 Wistron Corp 1 1 0 5 Mediatek Inc 0 0 2 5 Semiconductor Manufacturing International Corp 1 1 0 3 Lite-On Technology Corp 0 2 0 3 Atech Totalsolution Co Ltd 0 2 0 2 Total Chinese Sellers 103 99 63 467 Source: USPTO Assignment Analysis by AST, 2010-2017
  29. 29. 30 Top Chinese Buyers by Number of Transacted Assets during 2015-2017 Buyer 2017 2016 2015 Total Since 2010 Xiaomi Technology Co Ltd 96 893 50 1039 BOE Technology Group Co Ltd 0 556 6 562 TSMC 274 65 40 773 Pixart Imaging Inc 1 164 0 230 Alpad Corp 153 0 0 153 Ruizhang Technology Ltd Co 0 0 151 151 Huawei Technologies Co Ltd 18 71 58 286 Shenzhen O-Film Tech Co Ltd 0 0 139 139 YFY Inc 2 114 0 135 Apollo Ding Rong Solar Technology Co Ltd 0 104 0 104 Epistar Corp 74 0 24 111 Tcl Corp 0 53 42 96 AU Optronics Corp 0 0 76 79 Zhongshan Innocloud Intellectual Property Services Co Ltd 0 0 56 56 Metis IP LLC 0 53 0 53 Total Chinese Sellers 1121 2635 904 7315
  30. 30. Business Sense • IP Matters IAM Blog - ZTE • Interesting • Sale of four patents • Sued HTC in Nanjing Intermediate Court • Published rate sheet • Lower rates in China Attorney-Client Privileged & Confidential 31 Type of sale Volume sold until Jan 2027 FRAND unit royalty rates (US$) United States European Union China Standard Any (no limit) 0.10 0.10 0.05 Compliant 0 – 5,000,000 0.08 0.08 0.04 5,000,001 – 20,000,000 0.06 0.06 0.03 20,000,001 – 50,000,000 0.04 0.04 0.02 50,000,000+ $2.50m fully paid-up licence $2.50m fully paid-up licence $1.25m fully paid-up licence
  31. 31. Business Sense • IP Matters Attorney-Client Privileged & Confidential 32 BUSINESS SENSE • IP MATTERS ROL Group has over 60 years of IP strategy and execution experience. We ask the business questions first. We blend in- house and large law firm experience to create clear steps for success. We guide companies through unique IP challenges—like buying and selling patents, developing licensing programs, defending against patent assertions, and creating a value-driven IP portfolio. We give direction to businesses that share our passion for new ideas, creative problem solving and forward motion. Contact Information: +1 (650) 967-6555 info@richardsonoliver.com

×