Siemens’ Marathon deal highlights the growing importance of ex-US assets for monetisation-focused business models

Patent monetisation firm Marathon Patent Group announced last week that it is buying over 300 patents from German tech giant Siemens. The deal looks to be one of the most significant publicly announced pure patent transactions between an NPE and an operating company in recent months.

The patent purchase agreement will see Marathon’s subsidiaries acquire two portfolios from Siemens and its affiliates.

The first portfolio consists of 221 patents relevant to W-CDMA and GSM cellular telecommunications technology. Many of these patents have been declared essential to industry standards including GPRS, LTE and UMTS. According to a press release announcing the deal, assets in the portfolio cover “all the major global economies including China, France, Germany, the United Kingdom and the United States”.

The second portfolio includes 86 Internet of Things (IoT)-related patents, mainly covering self-healing control networks for building automation systems and underpinning a wide variety of IoT-enabled devices including lighting, sensors and appliances.

Commenting on the deal, Doug Croxall, Marathon’s CEO, stated that the firm intends to “assert our patent rights, wherever infringed”. He also highlighted the fact that the acquisitions from Siemens represent a substantial enlargement of the NPE’s overall portfolio: “The transaction with Siemens not only materially increases our asset count to now 631 US and foreign patents, with 79 patent applications, but importantly, it will expand Marathon's patent licensing activity into Asia, while remaining active in both the United States as well as countries in Europe.”

Two things stand out about this transaction. First, it underlines that there is still plenty of interest among operating companies in selling patents to NPEs – so long as the buyer is seen as a credible business partner. With this in mind, the IAM Market portal is intended to provide an efficient platform by which potential buyers and sellers can make contact and get to know one another before agreeing to any deal.

Second is Croxall’s specific mention of Asia. Interest in Asian – and particularly, Chinese – patent assets is on the rise among prospective buyers. Moreover, the United States presents an increasingly tough environment in which to enforce and monetise patents, and the European Union’s unitary patent system appears to be on hold after Britain’s vote to leave the bloc. With China and other Asian countries looking to increase IP specialism in their court systems and to raise available damages for infringement, they represent a promising alternative for assertion and licensing campaigns.

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