Friday, February 14, 2014
Location, Location, Location
In recent years, there has been a large increase in the number of patent litigation cases held in the Eastern District of Texas. While this seemingly random district would not be where people would think to file for lawsuit, it is popular for a number of reasons.
To start, the district has a number of local rules that expedite the trial process. For patent cases, having an expedient trial can make all the different because as large corporations know best, time is money. With shorter trials, it is much easier for the plaintiffs to win because the defendant must put together a solid defense, which is pricey. This has caused Eastern Texas to be a place that the defendant wants to avoid altogether, while the plaintiff wants to file in this district.
The Eastern District is also infamous for favoring plaintiffs during trials as well as local technology. This has caused a number of companies, including Exxon, to form "Texas LLC's" in order to win favor with local courts.
Perhaps the most telling reason that the Eastern District of Texas has become so popular is because of the demographic. This region of Texas has a less education population than many other districts and is on average, an older population as well. This combination allows for a less technical audience to jury these cases, allowing for a better chance that the plaintiff will win.
I hope that districts across the map can become more universal in ruling. With districts like Eastern Texas, litigation becomes more of a strategy game than about the intellectual property.
Source: http://arstechnica.com/tech-policy/2013/01/east-texas-courts-are-back-on-top-for-patent-lawsuits/
To start, the district has a number of local rules that expedite the trial process. For patent cases, having an expedient trial can make all the different because as large corporations know best, time is money. With shorter trials, it is much easier for the plaintiffs to win because the defendant must put together a solid defense, which is pricey. This has caused Eastern Texas to be a place that the defendant wants to avoid altogether, while the plaintiff wants to file in this district.
The Eastern District is also infamous for favoring plaintiffs during trials as well as local technology. This has caused a number of companies, including Exxon, to form "Texas LLC's" in order to win favor with local courts.
Perhaps the most telling reason that the Eastern District of Texas has become so popular is because of the demographic. This region of Texas has a less education population than many other districts and is on average, an older population as well. This combination allows for a less technical audience to jury these cases, allowing for a better chance that the plaintiff will win.
I hope that districts across the map can become more universal in ruling. With districts like Eastern Texas, litigation becomes more of a strategy game than about the intellectual property.
Source: http://arstechnica.com/tech-policy/2013/01/east-texas-courts-are-back-on-top-for-patent-lawsuits/
Return on Investment
When Google bought Motorola in 2011 for $12.5B and then sold it in 2014 for about $3B, many people viewed it as a huge loss. Despite Motorola being used as leverage against Samsung and the benefits from that, Motorola also proved to be much more of a profit than is seen on the surface.
At face value, the purchase of Motorola is seen as about a $10B loss. When a closer look is taken, however, it can be seen that Google had much more up its sleeve. According to Gordon Kelly, "What it misses are the $3.2bn Motorola had in cash, $2.4bn saved in deferred tax assets and two separate Motorola unit sales totalling $2.5bn in 2013. Factor in Lenovo’s purchase against roughly $2bn of Motorola losses during Google’s ownership and Google has still only paid $3bn for what it retained."
Fortunately for Google, this were tens of thousands of Motorola patents that totaled in value at about $5.5 billion. These patents will serve Google for years in lawsuits against mobile phone manufacturers. In addition to this value is the intangible value of now owning Motorola's research and facilities. These facilities will serve to promote Google hardware, which is what the company is lacking. Google will now become less dependent on other companies to use their operating system and the autonomy that Google now has is priceless.
This purchase goes to show that there is much more to purchasing a company that the purchase price and the sales price. Motorola had many assets that Google could claim, which made the purchase of Motorola a net gain in the end.
At face value, the purchase of Motorola is seen as about a $10B loss. When a closer look is taken, however, it can be seen that Google had much more up its sleeve. According to Gordon Kelly, "What it misses are the $3.2bn Motorola had in cash, $2.4bn saved in deferred tax assets and two separate Motorola unit sales totalling $2.5bn in 2013. Factor in Lenovo’s purchase against roughly $2bn of Motorola losses during Google’s ownership and Google has still only paid $3bn for what it retained."
Fortunately for Google, this were tens of thousands of Motorola patents that totaled in value at about $5.5 billion. These patents will serve Google for years in lawsuits against mobile phone manufacturers. In addition to this value is the intangible value of now owning Motorola's research and facilities. These facilities will serve to promote Google hardware, which is what the company is lacking. Google will now become less dependent on other companies to use their operating system and the autonomy that Google now has is priceless.
This purchase goes to show that there is much more to purchasing a company that the purchase price and the sales price. Motorola had many assets that Google could claim, which made the purchase of Motorola a net gain in the end.
Google's Best Purchase?
Many people believe that Google's purchase of Motorola Mobility in 2011 was overpriced and ineffective. Buying Motorola, however, turned out to be an extremely worthwhile purchase, as it allowed Google to lock in a partnership with Samsung all while gaining patents and resources.
Samsung was the premier ship that carried the Android platform. About 80% of the marketshare for Android came from Samsung devices but Samsung had other plans in mind. Despite using the Android operating system, Samsung started to develop their own apps and slowly started replacing the Android apps with their own. Google feared that eventually, Samsung would remove Android altogether and without prominent hardware in the market, Google would lose an incredible amount of money. To counteract this, Google made a hefty purchase of Motorola for $12.5B. With Motorola, Google acquired tens of thousands of patents that they used as leverage against Samsung.
In addition to litigation, Google also acquired all the Motorola facilities and began working on the Moto X and Moto G. Now that Google was able to make successful phones, it showed Samsung and other companies that they did not need other phones to carry their OS.
Samsung had no choice but to settle with Google. In late January, they signed a 10 year deal with Google that would prevent Samsung from continuing to replace the Android OS. Within two days, Google was already on its way to selling Motorola to Lenovo. Clearly, Google had one intention when it came to Motorola and once that dispute was settled, sold it right off.
Samsung was the premier ship that carried the Android platform. About 80% of the marketshare for Android came from Samsung devices but Samsung had other plans in mind. Despite using the Android operating system, Samsung started to develop their own apps and slowly started replacing the Android apps with their own. Google feared that eventually, Samsung would remove Android altogether and without prominent hardware in the market, Google would lose an incredible amount of money. To counteract this, Google made a hefty purchase of Motorola for $12.5B. With Motorola, Google acquired tens of thousands of patents that they used as leverage against Samsung.
In addition to litigation, Google also acquired all the Motorola facilities and began working on the Moto X and Moto G. Now that Google was able to make successful phones, it showed Samsung and other companies that they did not need other phones to carry their OS.
Samsung had no choice but to settle with Google. In late January, they signed a 10 year deal with Google that would prevent Samsung from continuing to replace the Android OS. Within two days, Google was already on its way to selling Motorola to Lenovo. Clearly, Google had one intention when it came to Motorola and once that dispute was settled, sold it right off.
Friday, February 7, 2014
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