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Patent-Licensing Firm Takes Google & Samsung To Court

October 2, 2015 - Written By Fernando Bonilla

Patent-licensing company Unwired Planet has sued three of Android’s biggest players: Samsung Electronics Co., Huawei Technologies Co., and even Google Inc. itself. The company claims these companies violated licensing terms for patents it holds. Unwired Planet is seeking a ruling that would see the tech companies hand over hundreds of millions of dollars.

The trials are set to be held over a period of more than a year in length, an unusually costly process that is uncommon in the world of smaller firms like Unwired Planet. However, this particular company is traded publicly, granting it access to funds that private companies don’t have. Unwired Planet has selected a London court for its six trials. European courts are more likely to pass a favorable ruling for the patent company. In the United States, many high-profile tech companies have been sued over alleged violations and use of patented technologies. Many of these businesses have called on Congress to pass new laws limiting the power of patent licensing companies to sue in an abusive, money-grabbing manner.

The well-known term “patent troll” was coined in the ’90s by an attorney at Intel Corp. Noah Messel, Unwired Planet’s general counsel, called the term “hackneyed” and demeaning. Messel believes his business model is legitimate, explaining that Unwired Planet happens “to be at the point in our business cycle where what’s left is a patent portfolio.” The company is comprised of 16 employees though it previously had 2,200 under the name OpenWave Systems. Since then, it has transformed into a patent firm where its revenue comes from successful court trials, not from having any sort of product.

It seems their business model is at least somewhat successful, with Unwired Planet’s valuation sitting at $85 million. Their portfolio size jumped in 2013 after 2,185 patents were transferred from Ericsson. The patents involved in their current case are restricted to Britain though their holdings include many international patents. Unwired Planet’s newest lawsuit isn’t their only high-profile attempt. In fact, it would be their second strike at Google. The company sued at a U.S. court and lost a preliminary ruling in December. In response, Unwired Planet’s stock dropped a massive 40 percent. The company also sued smartphone maker Apple two years ago and lost the case. They haven’t given up, however, and are currently appealing the court’s ruling. A deal with Lenovo last year was successful and amounted to $100 million.