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Friday, July 24, 2015

LOT ("License on Transfer") Network

LOT ("License on Transfer") Network was established by leading technology companies ( (Google, Canon, SAP, Newegg, Dropbox and Asana)  to reduce the number of patent infringement claims received from non-practicing entities that purchase patents for the sole purpose of enforcing them (called Patent Assertion Entities, or PAEs). There are over 325,000 patent assets including more than 99,000 issued US patents in the LOT Network. 
Companies participating in LOT Network obtain licenses effective upon the transfer of patents by other participants to non-participants, e.g., PAEs. In the event that patents held by a LOT Network participant are  transferred through a triggering event (e.g., a transfer to an entity other than another LOT Network participant), every active LOT Network participant as of the date of transfer will have its license to the transferred patents become effective. This arrangement immediately reduces the risk of PAE litigation to participants. 
Read the SSRN paper by David Hayes.

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