After US ITC decided to investigate Nvidia after Samsung's complaint regarding an alleged patent infringement, the South Korean consumer electronics giant seems to be getting one more good news. RPX has announced that it will buy the remaining 4,000 patents from the Rockstar Consortium for around $900 million. This agreement will also result in the end of Rockstar's lawsuits against a number of Android smartphone vendors such as Samsung, Huawei, HTC, and LG, among others. In 2011, Five technology giants, Apple, Microsoft, BlackBerry, and Sony collectively purchased 6,000 patents from a now defunct Nortel Networks for $4.5 billion, outbidding Google. 2,000 of those patents were distributed among these companies and the remaining 4,000 patents were collected under Rockstar Consortium organisation. Last month, Rockstar announced a settlement with Google concerning seven search related patents.
John A. Amster, Chief Executive and Co-founder of RPX said, “We are pleased to act as a clearinghouse and underwrite an agreement between the owners of Rockstar and our syndicate of licensees. Leading technology companies from multiple industries came together to shape this transaction. We commend everyone involved for their leadership and commitment to clearing the risk of the Rockstar portfolio by negotiating a reasonable purchase price in one efficient transaction. This is the largest syndicate of its kind, and it proves once again that our clearinghouse approach can transform the patent licensing process from one dominated by prolonged litigation to one that is transparent, scalable, and provides a rational outcome for licensors and licensees alike”
RPX Clearinghouse will receive license payments from a syndicate of over 30 companies, including Cisco and Google. Upon closing, which is subject to regulatory approval and other customary conditions, syndicate participants will receive non-exclusive licenses to the Rockstar patents, and RPX Clearinghouse will make the patents available for license to all other interested companies under fair, reasonable, and non-discriminatory (FRAND) terms.
RPX received a transaction fee for its work, a portion of which has already been included in 2014 guidance and the remainder of which will be recognized upon closing. In addition, RPX expects to contribute approximately $35 million to the transaction in exchange for ownership of the patents. RPX will recoup a majority of the investment from licensees already under contract. More details about the benefits to RPX and about financial implications will be provided when RPX reports year-end earnings in February.
