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BlackBerry Friends Facebook

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(Photo by Sean Gallup/Getty Images)

Never doubt the ability of investor pleasure. Or assume that the one worth of a patent litigation — particularly for a publicly traded business monetizing its patents — is the quantity of damages at play. Those two classes have been bolstered by a wild day of buying and selling this previous Friday for a legendary parts business that has change into very depending on its enormous patent portfolio for income technology. The business? None aside from BlackBerry, the maker of digital companions for a technology of legal professionals. At one level Friday, the corporate’s market cap was up over $1 billion, earlier than fading over the course of the day to shut up 8%, or the equal of (solely) a couple of hundred million added to the corporate’s worth. In addition to the worth swing, over 150 million shares traded hands, capping off a frenzied spherical of buying and selling proper earlier than the weekend.

What set off the fireworks? At first it was rumors a couple of world patent settlement between BlackBerry and Facebook — rumors that have been rapidly adopted by confirmation {that a} settlement had been reached. As highly anticipated, phrases of the settlement have been introduced as confidential, however that didn’t cease traders from driving up BlackBerry’s share worth, maybe under the belief that Facebook had agreed to pay a major amount of cash in alternate for patent peace. The declining enthusiasm for the information, no less than as mirrored within the fade in BlackBerry’s share worth because the day wore on, was most certainly a mirrored image of refined traders recognizing that optimistic assumptions about what is the cost Facebook might have agreed to pay have been at greatest speculative. Yes, maybe a fee by Facebook was agreed to, however that reality (or the quantity) will probably not be confirmed till BlackBerry’s subsequent quarterly investor updates on the earliest. Still, Friday’s motion in BlackBerry’s share worth is a potent reminder of the potential worth technology for publicly traded firms embarking on a patent monetization marketing campaign.

While the phrases of the settlement might have been confidential, it’s worthwhile to contemplate what a settlement between BlackBerry and Facebook might have regarded like. It is much more worthwhile to guage how the moves and countermoves (a few of which I chronicled on these pages again in 2018) both sides employed through the years of litigation between the events might have contributed to the end result reached this previous week. While we are able to speculate that the settlement might have included a cross-license, as well as a worldwide license to BlackBerry’s portfolio that may preclude future assertions towards FB, it’s exhausting to essentially know what the precise settlement phrases are — regardless of how showing interest traders are in understanding the small print. What we do know is that either side have been capable of get to a deal after years of litigation.

From a timing perspective, it’s not stunning that the settlement comes on the heels of a adverse ruling for BlackBerry within the Federal Circuit. As reported in TheRecorder, BlackBerry’s try and overturn unfavorable Alice rulings in its circumstances towards Facebook and Snap appeared to go well because the “Federal Circuit sounded… as if it might revive” these patents. But regardless of any optimism which will have arisen from the oral argument, the Federal Circuit panel rapidly issued a Rule 36 affirmance of the ineligibility determinations. With that recent setback in hand, it actually seems that BlackBerry was motivated to call a halt to its marketing campaign towards Facebook earlier than extra harm was completed to the repute of its patent portfolio.

Despite the setbacks it confronted towards Facebook, it will be unfair to call BlackBerry’s marketing campaign a complete failure. For one, it did get to the purpose what place it might announce a settlement, with a ensuing rise in business worth as a consequence. It additionally confirmed that it might go toe-to-toe with a really expert patent defendant — one with the sources and can to execute a textbook activist patent protection technique, consisting of a countersuit, IPRs, and early validity challenges to the BlackBerry patents asserted towards it. In brief, BlackBerry managed to hold on and reside to battle one other day, maybe towards a much less inclined-to-fight-back opponent.

Assuming that the settlement didn’t lead to Facebook making a considerable fee to BlackBerry, then it’s probably that the cash spent on Facebook in its own protection paled compared to the monetary calls for BlackBerry might have made on the outset of the case. Which would make the protection prices, regardless of how substantial, cash well-spent — each when it comes to the monetary financial savings relative to BlackBerry’s calls for as well as with respect to the deterrent impact towards potential patent monetization hopefuls. The latter goal shouldn’t be underestimated, since if Facebook was capable of repel the assault of a (former) know-how large armed with a repute for innovation and lots of 1000’s of patents, what hope does a less-pedigreed patent proprietor have towards the corporate? Yes, patent house owners can and do win towards the most-dogged of defendants from time to time. But it stays a dangerous endeavor, particularly towards an organization like Facebook.

Ultimately, along with serving as a reminder that even a confidential settlement can deliver dividends to a patent proprietor, this case additionally reminds us that even probably the most heated patent disputes can and do settle sooner or later. The stability of energy between plaintiff and defendant might shift over time, as courtroom determinations and market elements make an impression. But settlement is at all times an possibility, and expert litigators do well by their purchasers by holding that in thoughts, whereas additionally seeking to drive the very best cut price accessible as soon as a settlement window opens. If something, BlackBerry friending Facebook drives that lesson residence.

Please be happy to ship feedback or inquiries to me at gkroub@kskiplaw.com or through Twitter: @gkroub. Any subject recommendations or ideas are most welcome.


Gaston Kroub lives in Brooklyn and is a founding accomplice of Kroub, Silbersher & Kolmykov PLLC, an mental property litigation boutique, and Markman Advisors LLC, a number one consultancy on patent points for the funding neighborhood. Gaston’s apply focuses on mental property litigation and related counseling, with a powerful deal with patent issues. You can reach him at gkroub@kskiplaw.com or keep track of him on Twitter: @gkroub.

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