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Patrick Anderson  

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  • Vringo Vs. Google: Google's Motions For Judgment As A Matter Of Law [View article]
    Steve -
    You are right that Google's motion is largely a procedural move (preserving issues for post-trial and appeal). Rather than deny the motion outright, another common move from a trial judge at this point is to defer ruling on the motion until after the trial is over. After all, if the jury finds the patent invalid, or finds no infringement, then Google's JMOL is largely mooted.
    Oct 31, 2012. 09:24 AM | Likes Like |Link to Comment
  • Acacia Research Partners With Boston Scientific For A Major Medical Patent Play [View article]
    Might be fears that it's another 'nose candy' deal ... high risk/high reward. Takes a lot of resources to comb through 1900 patents.
    Oct 10, 2012. 09:00 AM | 1 Like Like |Link to Comment
  • RPX Pursues More 'License Option' Agreements [View article]
    I think you've nailed exactly why this stock is what it is. They put out very few announcements and provide very little opportunity to get insight into what portfolio rights they have acquired or are in the process of acquiring. While USPTO assignment records can provide information on what patents they buy outright, there are no similar public sources to identify the license option agreements. In fact, the only reason I learned about the agreements referenced in the article was from the 8-K announcements of another publicly traded company.
    I'm pretty sure there have been entire quarters where the only mid-quarter announcements were for insider trading, which can't give outside investors a good feeling. A little more transparency into the patents and lawsuits RPX being targeted for acquisition and resolution would go a long way.
    Oct 9, 2012. 08:32 AM | 1 Like Like |Link to Comment
  • RPX Pursues More 'License Option' Agreements [View article]
    This is just my opinion, so take it for what it's worth. The cell phone wars have not really helped RPX's value. Their value is primarily as an intermediary, but unlike Acacia, they are not an intermediary for a company that is receiving money. Instead, they are an intermediary for a company that is spending money. So they only way they show value for that is to help the company spend less. The easiest way to spend less is to reduce the heavy transactional costs (Paul Ryan sometimes calls these "friction costs") associated with patent licensing.
    For a lot of the work RPX has done, they are facilitating licensing for patents where, on an individual customer basis, the transactional costs are as much or close to the actual license fees themselves, so they represent a substantial value. In the smartphone arena, you have a lot of players expecting significant licensing fees (or some cases, like Apple, who just want to keep competition at bay). In these cases, transactional costs are but a fraction of license fees, and RPX will have a tougher time showing value.
    Again, just my opinion. I need to study some numbers, but my gut tells me that, at current prices, they are probably somewhat undervalued ... but it is a delicate dance so execution means everything. Thenagain, that's nothing new.
    Oct 5, 2012. 01:46 PM | Likes Like |Link to Comment
  • RPX Pursues More 'License Option' Agreements [View article]
    Thanks for the suggestion. It is difficult sometimes to keep articles brief and readable while providing all of the information readers might want. Unified Messaging Solutions, which is one of the more broadly asserted portfolios, holds license rights to several patents, including this one:

    That should lead you to the others if you know what to look for. The patent was originally sold from Netoffice to J2 Global Communications, and ultimately dumped into what appears to be a J2-owned shell company and exclusively licensed to Acacia-owned Unified Messaging which handles the licensing.

    If there is enough interest in gathering detail on this and other patents related to this deal, a follow-up article may be in order.
    Oct 5, 2012. 10:24 AM | Likes Like |Link to Comment
  • Vringo's Mission: Take On The Patent Bullies [View article]
    QuantRec - where exactly did I claim to be "bullish" and "optimistic"?

    Seriously, if I'm not in love with a company, then I'm perceived as short. If I relay an interview without crushing a company, then I must be "bullish" and "optimistic."

    I can't think of a good paraphrase, so I'll just end with: Sometimes it's just a cigar.
    Aug 23, 2012. 09:10 PM | Likes Like |Link to Comment
  • Vringo's Mission: Take On The Patent Bullies [View article]
    Joe Kelly -

    Why not engage? I doubt extra traffic driven over fabricated "controversy" over my motives related to an obscure stock that is (likely) mostly owned by institutional investors really presents any significant upside. Besides, I have a day job. A true academic debate can hold my interest, but not mudslinging. I'll admit, however, you do raise a good point.

    Re 'non public companies' - why? For most traders, there is no realistic, present investment opportunity in the non-public companies that I follow closely. Of course, any would be fair game to go public someday, so with that said, a few companies in the IP space that I think are interesting are Intellectual Ventures, IP Navigation Group, Mosaid (which recently went private and also bought a chunk of NOK patents), and Personalized Media Communications. Of these, Personalized Media is probably the most closely held, but I would not be at all surprised if they sold off some equity in the not-to-distant future.
    Aug 23, 2012. 09:07 PM | Likes Like |Link to Comment
  • Vringo's Mission: Take On The Patent Bullies [View article]
    My previous article was mostly about the economics of the purchase, which I still do not believe are ideal. Embarking on a new monetization campaign is inherently risky, and I personally prefer deal structures that give the acquiring entity a much larger share of the total economics than Vringo is getting in this deal. Was I wrong about a handset focus? Yes, absolutely and I admitted that in the article.

    The purpose of this article was to get Vringo's response to my criticisms more exposure, which I have done. If you look at the arrangement as less of a "purchase" and more of a "partnership," then arguably Vringo did get a good deal. Vringo paid $22 M for, essentially 65% of the income produced, so a one-time cash value on the portfolio would be about $34 M. For example, suppose you valued the total portfolio at, say $100 M (a completely made-up number, but assume that's based on what you think you can collect). You can play around with that number, as well as general and adjusted values for likelihood of success--less than 50% of patent owners win at trial, 80% of patent cases settle before trial, an industry-wide pursuit against multiple targets with multiple patents in different lawsuits can reduce your overall risk if you assume you only need to hit on one case, but chinks in the armor like re-exams or an aggressive defendant who manages to invalidate key patents in the first trial ... the list goes on.

    As it stands, the guys at Vringo I spoke to sound supremely confident. They are seeing mostly upside. As a habit, and not specific to Vringo, I tend see mostly risk ...
    Aug 23, 2012. 08:59 AM | 1 Like Like |Link to Comment
  • Vringo's Mission: Take On The Patent Bullies [View article]
    As a rule:
    1. I generally don't invest in public companies. I am, however, very interested in patent monetization and the various management teams and business models that are deployed.

    2. I generally don't engage commenters who make unsupported accusations about the veracity of my disclosures from the relative safety, obscurity and anonymity of the internet. It's really not worth the trouble.
    Aug 23, 2012. 08:37 AM | 1 Like Like |Link to Comment
  • Will Vringo's $22 Million Patent Purchase Pay Off? [View article]
    "?? No one in their right mind would invest in VRNG for the ringtones alone."

    I agree. I think the volatility after the 10-Q announcement probably related more to people getting out of the stock after realizing they Vringo has more or less officially changed to an IP monetization business model.
    Aug 17, 2012. 11:11 AM | Likes Like |Link to Comment
  • Acacia CEO Paul Ryan Clarifies Second Quarter Results And 'Key Performance Metrics' [View article]
    Same name, different person. Paul Ryan the Vice-Presidential candidate is not the same Paul Ryan who is CEO of Acacia Research and the subject of this article.
    Aug 17, 2012. 08:39 AM | Likes Like |Link to Comment
  • Will Vringo's $22 Million Patent Purchase Pay Off? [View article]
    That's a good point about wireless infrastructure. Actually just got a phone call from someone at Vringo and they're going to arrange for me to speak with David Cohen about precisely that play.

    They also apparently mentioned in an investor call that I missed that they expect to negotiate contingency rates that will allow them to keep closer to $0.80 on the dollar. That does change the math significantly, though not the reasoning. If they can pay only 20% for legal services, they will be looking to gross close to $32 M in order to break even. A far cry from $44 M, but still not small feat.
    Aug 15, 2012. 03:06 PM | 2 Likes Like |Link to Comment
  • What Patent Peace Looks Like [View article]
    "The bottom line is that Samsung now enjoys 21.6% of the mobile market, while Apple has just 6.9%."

    Is that measured in units? ABI research just reported last month that Apple and Samsung combine for 90% of smartphone industry profits.
    Aug 15, 2012. 01:46 PM | Likes Like |Link to Comment
  • Vringo Investors To Fund New Business Model [View article]
    Good point. Hopefully most people observed that I/P executives took over some key executive positions as a result of the merger, so really the future business was always more about the I/P business model than the original Vringo model anyway, but the Nokia deal cinches it...
    Aug 13, 2012. 03:27 PM | Likes Like |Link to Comment
  • Vringo Investors To Fund New Business Model [View article]
    Sorry, let me try and clarify. The "license back" covers the patents VRNG bought. VRNG can NEVER sue Nokia over these patents. The seven-year clause covers any patents VRNG might acquire in that time period.

    On the multiples, I'm not aware of models specific to IP monetization companies, but different strategies for valuing IP-based businesses is an area I am currently researching.
    Aug 9, 2012. 07:42 PM | Likes Like |Link to Comment