Jon Brodkin at Ars Technica reports on a patent dispute between Yahoo and Facebook. Yahoo filed a patent infringement case against Facebook in March, and now Facebook has acquired 10 patents from patent accumulators–otherwise called trolls or non-operating entities–to assert against Yahoo. PC World follows up with Yahoo’s effort to get the patents thrown out.
What’s interesting is that three of the patents Facebook acquired are from New York University. These are related and have one inventor in common, Alexander Tuzhilin, a professor of Information Sciences.
6236978 (referenced by 190 other patents!)
7603331
8103611
The transaction by which Facebook acquired an interest in the patents has been described as a “purchase”. Maybe it was, or maybe it was a license. In any case, Yahoo’s response has been to challenge the validity of these three patents. I don’t know if that will get anywhere, but I would expect that NYU got its money upfront, so it might not matter much from that perspective.
The thing that would be more worrying is if NYU is providing patents to feed lawsuits for infringement. I’m sure it’s not the first time this has been done by a university, but it is also not technology transfer. Facebook apparently isn’t acquiring the NYU patents in order to develop the inventions, but rather to assert the patents against a company that it claims is using the inventions! Should NYU have offered the patents first to Yahoo, which Facebook asserts is actually using the inventions covered by the patents? Perhaps it’s moot because Yahoo asserts in its response that it’s not using the inventions claimed by the patents. Maybe Yahoo would have declined.
I expect we will see more of this–university patents that have gone unlicensed (here, even one issuing earlier this year) being used as fodder for patent litigation. There is money doing so, but it’s not technology transfer, and it undermines the public justification for universities to be involved at all in the patenting business. Would it have been any better if Prof. Tuzhilin and his co-inventors had obtained the patents personally and assigned them to their own patent management company? Certainly for NYU, it would be better if they were focused on technology transfer and not on patent arbitrage. One might also wonder if Prof. Tuzhilin concurs with NYU’s sale of patents to Facebook for use in the Yahoo dispute, and whether he would approve the deal if held the patents personally.
If universities accumulate patents that they cannot license for “commercialization”, then I expect we will see more of this–transferring patents for the purpose of fueling litigation, patent arbitrage, patent trolling. There’s good money it, but it isn’t a purpose of Bayh-Dole, it doesn’t protect the investments of commercial developers, and it doesn’t conform to any public mission of a university.