Intellectual-VenturessmallPresident Barack Obama made it clear earlier this month that he wants to investigate the practices of patent-holding firms. Now,  it looks like the Federal Trade Commission is taking action.

The New York Times reports that the F.T.C. is planning to announce an investigation of the “patent trolls,” that will require companies to answer questions about the legitimacy of their business.

Bellevue-based Intellectual Ventures, which the NYT mentions in its article, is one of the biggest patent holding companies and will surely be investigated. The patent holding firm, which is owned by former Microsoft CTO Nathan Myhrvold, has come under scrutiny recently for its practices following a This American Life report investigating the company’s actions.

Intellectual Ventures has acquired more than 70,000 patents during its 13-year history, and has earned more than $3 billion by licensing those patents to other companies who ”use them to make computer equipment, software, semiconductor devices, and a host of other products,” the company said in legal documents.

But the firm, which has yet to produce a blockbuster commercial success of its own, has become quite litigious in recent years. It has sued companies such as ToshibaCanonSymantecAT&T, CenturyLink, Windstream, and most recently it took its patent fights to banks like Capital OneFirst National Bank of Omaha and PNC.

Patent trolls — also known as Patent Assertion Entities — were responsible for 62 percent of all patent infringement suits in the U.S. last year, according to a report from the National Economic Council and the Council of Economic Advisers. The number of suits stood at mind-blowing 2,500 last year. That’s up from 1,500 suits in 2011, or 45 percent of the total. Compare that to 2006 when they were responsible for just 19 percent.

Previously on GeekWire: This chart shows what’s royally messed up in the U.S. patent system

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  • Guest

    Okay, a couple things are getting tiring. One, GW’s clearly anti-IV editorial policy, which of late doesn’t even make a pretense at offering balanced coverage. Do you honestly think IV is worried about the validity of its business model? You may not like it. I’m not even sure I do. But there’s little reason to think it’s not legal and above board, particular compared to lesser entities who are far more suspect. Two, every reference to Myhrvold including the tagline “Former MS CTO”. He hasn’t been CTO in over a decade and wasn’t particularly well known when he was that. So why keep making this association? Is the idea that linking him to the “evil empire” or “M$” furthers the negative editorial policy? Here’s an idea. Try to get through the next IV story with something approaching balance and w/o reference NM as anything other than what he’s most famous for: founder and owner of IV.

    • fdsj

      Not sure how did you draw the conclusion that GW has an anti-IV editorial policy. IV gets mentioned in GW lately because of its questionable practice is in the news. GW is simply reiterate what’s out there. Don’t try to bash the messenger. And even more bizarre is how you link “MS CTO to evil empire”. There are many dozens of news in GW referring people as former MS employees. I don’t see them complain and interpret the reference negatively – in the contrary, it may even be considered as a vote of confidence for their technical competency. The problem, therefore, perhaps is not that GW is biased but because you have a biased viewpoint. It would be nice if you can disclaim yourself from having any association with IV – not that matters. I personally don’t have any affiliation with GW or IV, just in case you are wondering.

    • SeriouslyIV

      Seriously IV PR, cut it out. Only someone on the defensive would write this drivel. You are the only one stating that associating Nathan Myhrvold with MS is bad, so then you realize you are also admitting that he has a bad reputation or are you saying that MS is bad? Make up your mind. Myhrvold either has a bad reputation or worked for a “evil empire” using your words.

      What’s wrong with GW mentioning that Myhrvold was CTO at MS? How many people do you think know Microsoft and how many people do you think know IV? You are the only one deriving any negative connotation from this reference. Should we stop referring to Bill Clinton as a former President and just say he’s non profit founder now? Seriously, the victim card is wearing a little thin.

      Please give examples of GW’s supposed anti-IV editorial policy. Right now, you’re as bad as Fox News, seeing things that don’t exist. And yes what IV is doing may follow the letter of the law, but not the spirit and there’s a significant difference between. One reason why the FTC is getting involved. Perhaps your legal counsel can clue you in.

      When one engages in this type of unethical behavior it’s called abusing the system for your our own selfish greed.

      Seriously IV.

  • Guest

    What do you mean? The writer used the fair and balanced term “mind blowing” to help thoughtfully convey all sides of the issue.

  • guest

    what IV is doing is perfectly legal, they are exploiting the inefficiencies in the patent litigation system. the cost to litigate a patent is an unbelieveable amount – driven by lawyers fees and antiquated legal system

  • Kevin Pierce


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