IBM has always been a regular seller of its patents as a means to drive value from its giant portfolio. As we have reported in the past, some of those deals have taken the form of hybrid licensing/sale transactions which can carry some significant tax advantages.
But even by its own standards Big Blue has been on something of a tear this year, selling large portfolios to the likes of software business Pure Storage, IT services company HCL Technologies and e-commerce firm Wayfair.
Now, according to recent USPTO assignment records (here and here), it has sold more than 500 assets across two tranches to an entity called Daedalus Group. Details on Daedalus are scant but its managing principal is listed as Ed Gomez, who has a long track record in the IP monetisation space, including stints at Altitude Capital, Walker Innovation and General Patent Corporation.
If Daedalus were to now pursue a licensing campaign it would be a change of tack for patents that IBM has sold recently. Most of them have been acquired by operating companies that typically look to patent deals for defensive reasons.
According to the assignment document, which details the transfer of the largest tranche, Daedalus paid $9 million for that stockpile of patents and applications, which as well as US assets also includes rights in Europe and Asia. Given that IBM has traditionally been one of the most active licensors in the market we can assume that the patents come with a significant number of encumbrances.
This latest transfer, which the IP team at Houlihan Lokey advised the tech giant on, confirms that IBM’s huge portfolio - which according to the most recent IAM/ktMINE US Patent 100 includes a little over 60,000 US patents - continues to attract interest from a range of businesses.
Putting an extra twist on this is the tech giant’s recent acquisition of open source leader Red Hat. That deal closed in the summer and, as we have already detailed, could end up having a large bearing on IBM’s IP strategy as the company decides whether to join the License on Transfer Network (LOT).
Big Blue has until the turn of the year to decide whether to sign up but, according to a statement that it released after the Red Hat deal was announced, it is committed to the “continued freedom of open source via such efforts as… the LOT Network”. Joining the defensive patent operator does not rule out monetisation of those assets - a point that CEO Ken Seddon has been keen to stress - but it does place additional encumbrances on the patents.
In other words, if and when it joins LOT, IBM may be looking at a much lower valuation for its grants which may in turn slow down its rate of deal making. Its activity so far this year suggests that is firmly on the mind of its IP leaders.
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