Monday, June 30, 2008

Tech giants form group to buy patents

Google is part of a group of tech heavyweights going on the offensive against the threat of patent-infringement lawsuits, the Wall Street Journal reported on its Web site Sunday evening.

The group, which calls itself the Allied Security Trust, plans to buy up key intellectual property before it is obtained by parties who might use it against them, the newspaper reported. Joining Google in the group are Verizon Communications, Cisco Systems, Telefon AB L.M. Ericsson, and Hewlett-Packard, among others.

To join the group, each company will pay about $250,000 put about $5 million into escrow for future patent purchases, the newspaper reported, citing people familiar with the matter

The organization is the latest tactic for a tech industry that says it is under attack from "patent trolls" seeking to buy intellectual property to extract royalties from companies that rely on that technology. The Coalition for Patent Fairness, a lobbying group that represents tech companies, reports the number of patent-related lawsuits rose to nearly 2,500 through October of last year from 921 in 1990, the newspaper reported.

A sweeping patent law rewrite backed by seemingly every prominent hardware and software maker was part of that effort, but it stalled in the Senate last month. The so-called Patent Reform Act of 2007 would have curbed the ability of patent holders to obtain what the companies consider disproportionate damage awards, spurring the rise of so-called patent trolls who exist only to extort large payments out of deep-pocketed companies. Microsoft, Google,

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