Today’s post is authored by Abdul Zindani, Deputy Assistant General Counsel, Patent Prosecution, Conversant Intellectual Property Management Inc.
Conversant’s success in increasing the worth of the PGT Photonics portfolio is a perfect example of our Value Growth Strategy in action. We apply this strategy to our own IP assets – and those of our partners.
In late 2009, Conversant (then MOSAID), learned that Italy’s PGT Photonics S.p.A., a spinoff of tire manufacturer Pirelli & C. S.p.A., wanted to divest an international portfolio of more than 200 optical networking patents and patent applications.
The patent portfolio represented substantial R&D investment that had resulted in leading-edge innovation. PGT Photonics was at the forefront of developing an array of optical communications products, including tunable lasers, transceivers and transponders, as well as early ‘silicon photonics’ manufacturing processes. Silicon photonics is a method of manufacturing optical lasers and other components using CMOS (Complementary Metal Oxide Semiconductor) manufacturing techniques.
However, PGT Photonics was in financial distress. When a company makes a decision to divest patents or find a licensing partner, too often, Prosecution budgets have already been cut and the patents are not being properly maintained. That was true with PGT Photonics. In fact, many of its patents had already been abandoned for lack of funding. The situation was so serious that Conversant took the unusual step of assuming responsibility for strategically prosecuting the portfolio, even though due diligence was ongoing and the acquisition would not close until early 2011.
For two years, Conversant’s in-house team managed the portfolio of 200 patents and applications. Many patents were narrowly saved from abandonment, and one U.S. case that had already been abandoned was actually revived. Claims were amended as necessary, including significantly broadening the scope of key patents. Approximately 50 patent applications were granted worldwide, and strategic patent families were preserved by filing continuations and divisionals.
The result was a healthy, strong portfolio of optical networking patents. By exercising its skills and experience – and investing over US$1 million – Conversant Prosecution team had not only preserved the R&D heritage of the former PGT Photonics portfolio, but significantly improved its quality and thus, its intrinsic value.
Conversant management subsequently decided that the former PGT Photonics patents would have the greatest value in the hands of another owner, and sold the portfolio in early 2012 for significantly more than the purchase price.
The buyer? None other than Google Inc.
To read more on patent prosecution, please download our paper on a new vision for Patent Prosecution.