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Intellectual Ventures

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American private equity company
Intellectual Ventures Management, LLC
Company typePrivately held company
IndustryPatent monetization
Founded2000 Edit this on Wikidata
FounderNathan Myhrvold
Edward Jung
Peter Detkin
Gregory Gorder
HeadquartersBellevue, Washington, United States
Number of locations10
Number of employees800
ASN6216 Edit this at Wikidata
Websitewww.intellectualventures.com

Intellectual Ventures is an American private equity company that centers on the development and licensing of intellectual property. Intellectual Ventures is one of the top-five owners of U.S. patents, as of 2011. Its business model focuses on buying patents and aggregating those patents into a large patent portfolio and licensing these patents to third parties. The company has been described as the country's largest and most notorious patent trolling company, the ultimate patent troll, and the most hated company in tech.

In 2009, the firm launched a prototyping and research laboratory, Intellectual Ventures Lab, which attracted media controversy when the book SuperFreakonomics described its ideas for reducing global climate change. The firm also collaborates on humanitarian projects through its Global Good program.

Overview

In 2000, Intellectual Ventures was founded as a private partnership by Nathan Myhrvold and Edward Jung of Microsoft, later joined by co-founders Peter Detkin of Intel, and Gregory Gorder of Perkins Coie. The Intellectual Ventures Management Company is owned 40% Nathan Myhrvold, 20% Peter Detkin, 20% Gregory Gorder and 20% Edward Jung. They reportedly have raised over $5.5 billion from many large companies including Microsoft, Intel, Sony, Nokia, Apple, Google, Yahoo, American Express, Adobe, SAP, Nvidia, and eBay, plus investment firms such as Stanford, Hewlett Foundation, Mayo Clinic, and Charles River Ventures. In December 2013, the firm released a list of approximately 33,000 of the nearly 40,000 assets in their monetization program. Licenses to patents are obtained through investment and royalties. In March 2009, the firm announced expansion into China, India, Japan, Korea and Singapore to build partnerships with scientists and institutions in Asia.

Investment funds

The company operates three primary investment funds:

  • Invention Investment Fund (IIF), purchasing existing inventions and licensing them
  • Invention Development Fund (IDF), partnering chiefly with research institutions to file descriptions of new inventions
  • Investment Science Fund (ISF), focused on internally developed inventions

Intellectual Ventures Lab

In 2009, Intellectual Ventures launched a prototyping and research laboratory, Intellectual Ventures Lab, hiring scientists to imagine inventions which could exist but do not yet exist, and then filing descriptions of these inventions with the US Patent Office. Notable participants include Robert Langer of MIT, Leroy Hood of the Institute for Systems Biology, Ed Harlow of Harvard Medical School, Bran Ferren and Danny Hillis of Applied Minds, and Sir John Pendry of Imperial College. The Sunday Times reported that the company applies for about 450 patents per year, in areas from vaccine research to optical computing and, as of May 2010, 91 of the applications had been approved. Internally developed inventions include a safer nuclear reactor design (which won the MIT Technology Review Top 10 Emerging Technologies in 2009) that can use uranium waste as fuel or thorium which is plentiful and poses no proliferation risk, a mosquito-targeting laser, and a series of computer models of infectious disease.

Their efforts to promote a method to reverse or reduce the effects of global climate change by artificially recreating the conditions from the aftermath of a volcanic eruption gained media coverage following the release of the book SuperFreakonomics, whose chapter about global warming proposes that the global climate can be regulated by geo-engineering of a stratoshield based upon patented technology from the company. The chapter has been criticized by some economists and climate science experts who say it contains numerous misleading statements and discredited arguments, including this presentation of geoengineering as a replacement for CO2 emissions reduction. Among the critics are Paul Krugman, Brad DeLong, The Guardian, and The Economist. Elizabeth Kolbert, a science writer for The New Yorker who has written extensively on global warming, contends that "just about everything they have to say on the topic is, factually speaking, wrong." In response, Levitt and Dubner have stated on their Freakonomics blog that global warming is man-made and an important issue. They warn against claims of an inevitable doomsday; instead they look to raise awareness of less traditional or popular, methods to tackle the potential problem of global warming.

Lowell Wood, an "inventor in residence" at Intellectual Ventures, became the most-patented inventor in US history in 2015, breaking the record held by Thomas Edison for over 80 years.

Global Good

Global Good was a not-for-profit collaboration between the firm and the Gates family, to develop solutions for pressing problems in the developing world. Its technologies included:

  • Arktek, a passive vaccine storage device that allows vaccines to be transported to parts of the world that lack reliable refrigeration. It uses a small amount of ice for cooling and requires no external power supply, relying on extraordinary insulation. The device has been used to transport vaccines around the world, and Myhrvold believes the device may be useful for transporting organs. The firm produced a modified version of the Arktek to transport newly developed Ebola vaccines to Sierra Leone and Guinea during the 2014 Ebola outbreak at the required much colder temperature.
  • The Photonic Fence, a device to identify and kill mosquitos with lasers to prevent malaria, suggested by Lowell Wood, a company researcher. The device uses a non-lethal laser to track insects and monitor their wing-beat frequency. If it detects a female mosquito, the device fires a kill laser. It has an effective range of 100 feet and can purportedly kill up to 100 mosquitoes per second. The device has not yet been mass-produced,.
  • The Autoscope, which uses artificial intelligence to diagnose malaria. The device has been field-tested in Thailand and reportedly outperformed the average human diagnostician. It too is not yet scheduled for mass-production.
  • Mazzi, a milk jug designed for farmers in the developing world. The firm partnered with Heifer International to design the jug, which is cheap, sturdy, and easy to clean with features a funnel that results in decreased spillage.

In mid-2020, Global Good was dismantled, with some of its components (most notably the Institute for Disease Modeling) transitioning into the Gates Foundation, and some evolving into new entities under Gates Ventures.

Companies created

Intellectual Ventures has created a number of independent companies to bring its discoveries to mass market. Examples include Kymeta, a satellite technology company, TerraPower, which seeks to improve nuclear power, Evolv, which applies metamaterials to imaging, and Echodyne, a metamaterials-based radar communications company.

Controversy

Main article: Patent trolling

Publicly, Intellectual Ventures states that a major goal is to assist small inventors against corporations. In practice, the vast majority of IV's revenue comes from buying patents, aggregating these patents into a single portfolio spanning many disparate technologies and tying these patents together for license to other companies under the threat of litigation, or filing lawsuits for infringement of patents, a controversial practice referred to as "patent trolling."

Intellectual Ventures' purchased patents have largely been kept secret, though press releases with Telcordia and Transmeta indicated some or all of their patent portfolios were sold to the company. It reports that its purchasing activity as of spring 2010 has sent $350 million to individual inventors, and $848 million to small and medium size enterprises as well as returning "approximately $1 billion" to investors before filing any lawsuits, but IV's assistance to individual inventors has been contested. Investigative journalism suggests that the company makes most of its income from lawsuits and licensing of already-existing inventions, rather than from its own innovation. Intellectual Ventures has been described as a "patent troll" by Shane Robison, CTO of Hewlett-Packard and others, allegedly accumulating patents not in order to develop products around them but with the goal to pressure large companies into paying licensing fees. Recent reports indicate that Verizon and Cisco made payments of $200 million to $400 million for investment and licenses to the Intellectual Ventures portfolio. On December 8, 2010, in its 10th year of operations, Intellectual Ventures filed its first lawsuit, accusing Check Point, McAfee, Symantec, Trend Micro, Elpida, Hynix, Altera, Lattice and Microsemi of patent infringement. In September 2016, the Court of Appeals for the Federal Circuit ruled that all the relevant patent claims in the lawsuit were invalid, because "the patent merely applies a well-known idea using generic computers".

The company has been accused of hiding behind shell companies for earlier lawsuits, an accusation consistent with the findings of NPR's Planet Money in July 2011. The episode, which also aired as the This American Life episode "When Patents Attack", was dedicated to software patents, prominently featuring Intellectual Ventures. It includes sources accusing Intellectual Ventures of pursuing a strategy encouraging mutually assured destruction, including Chris Sacca calling Myhrvold's argument that Intellectual Ventures is offering protection from lawsuits in a "mafia-style shakedown". However, the firm's internal research, development, and commercialization activities have softened this image. Following a series of research project announcements by Intellectual Ventures, intellectual property columnist Jack Ellis wrote, "Although licensing is bound to remain a big part of what it does, the more agreements of the kind signed this week IV is involved in, the harder it will be to label as a troll."

Intellectual Ventures staff are active in lobbying and testifying in court on United States patent policy.

References

  1. "Intellectual Ventures: Revealing Investors ", Patently-O blog, May 18, 2011. Consulted on May 21, 2011.
  2. "RPX and the complicated business of stockpiling patents for good, not evil". Pando. 9 September 2013.
  3. Robertson, Adi (4 February 2014). "The ultimate patent troll is going to trial against Google and Motorola". The Verge.
  4. Kerstetter, Jim. "Inside Intellectual Ventures, the most hated company in tech". CNET.
  5. "Bellevue lab is an inventor's real dream" by Brier Dudley, The Seattle Times - 27 May 2009
  6. "Global Good". www.intellectualventures.com. Retrieved 2016-06-16.
  7. "Defendants Certificate of Interest" (PDF). US District Court, N. California. 2011-05-16. Archived from the original (PDF) on 2012-10-06. Retrieved 2013-07-18.
  8. "Intellectual Ventures Find a Patent". 2013-12-16.
  9. Richardson, Kent (2014-06-14). "What's Inside IV's Patent Portfolio". IAM Magazine. London. Issue 66. July/August 2014
  10. "Ubuntu: Microsoft is Patent Pal" Archived 2007-05-25 at the Wayback Machine by Matthew Broersma, PCWorld - 23 May 2007
  11. "Investing in Invention". Intellectual Ventures. Archived from the original on 2010-06-30. Retrieved 2010-12-26.
  12. Harris, Mark (May 16, 2010). "Green Pioneers: Godfather of nutty inventions". The Times. London. Archived from the original on May 22, 2010. Mark Harris, The Sunday Times, May 16, 2010
  13. "TR10: Traveling-Wave Reactor" by Matt Wald, Technology Review - March/April 2009
  14. "Mosquito laser gun offers new hope on malaria" by Tony Allen-Mills - 15 March 2009
  15. "Mathematics, Mosquitoes, and Malaria" Archived 2011-07-22 at the Wayback Machine by Philip Eckhoff, Hertz Foundation Biennial Symposium - Spring 2009, Volume 11
  16. "Introducing the Stratoshield". Intellectual Ventures. 2009-10-21.
  17. Todd Bishop (2009-10-14). "Stratoshield: Nathan Myhrvold explains how to save the planet". TechFlash.
  18. Paul Krugman (2009-10-17). "SuperFreakonomics on climate, part 1". The New York Times. they grossly misrepresent other peoples' research, in both climate science and economics
  19. Brad DeLong (2009-10-19). "Yet More SuperFreakonomics Blogging". Grasping Reality with All Eight Tentacles. Levitt and Dubner today appear to no longer be thinking like economists
  20. "Why SuperFreakonomics' authors are wrong on geo-engineering". The Guardian. London. 2009-10-19. Many commentators have already pointed out dozens of misquotes, misrepresentations and mistakes in the 'Global Cooling' chapter
  21. "Freaking out: The controversy over SuperFreakonomics". The Economist. 2009-10-27. Retrieved 2009-11-06.
  22. "Kolbert, Elizabeth (November 16, 2009). "Hosed: Is there a quick fix for the climate?" [rev. of Levitt and Dubner's SuperFreakonomics and Al Gore's Our Choice]". New Yorker.
  23. Levitt, Steven D. (2009-10-17). "The Rumors of Our Global-Warming Denial Are Greatly Exaggerated". The New York Times. "... we believe that rising global temperatures are a man-made phenomenon and that global warming is an important issue to solve. Where we differ from the critics is in our view of the most effective solutions to this problem." and "The real purpose of the chapter is figuring out how to cool the Earth if indeed it becomes catastrophically warmer... if we weren't convinced that global warming was worth worrying about, we wouldn't have written a chapter about proposed solutions.
  24. "How an F Student Became America's Most Prolific Inventor". Bloomberg.com. Retrieved 2020-10-15.
  25. Cousins, Sophie (23 November 2015). "How Do You Keep Vaccines Cool? Try Spacecraft Insulation". NPR.org. Retrieved 2016-06-16.
  26. Fink, Sheri (2015-07-31). "Experimental Ebola Vaccine Tested in Guinea Shows Promise, Report Says". The New York Times. ISSN 0362-4331. Retrieved 2016-06-16.
  27. "Intellectual Ventures' laser mosquito zapper lands key licensing deal". GeekWire. 2015-03-03. Retrieved 2016-06-16.
  28. "Artificial Intelligence Offers a Better Way to Diagnose Malaria". MIT Technology Review. Retrieved 2016-06-16.
  29. "IV's Global Good Fund: A Legacy of Impact Invention". Intellectual Ventures. Retrieved 30 December 2020.
  30. "Kymeta Company History". Archived from the original on 2015-10-09.
  31. "About TerraPower | TerraPower". terrapower.com. Retrieved 2015-11-01.
  32. "Evolv". www.intellectualventures.com. Retrieved 2016-06-16.
  33. "About Us | Echodyne". echodyne.com. Retrieved 2015-11-01.
  34. Roberts, Jeff John (October 3, 2016). "Here's Why Software Patents Are in Peril After the Intellectual Ventures Ruling". Fortune Magazine. Retrieved 5 October 2016.
  35. "When Patents Attack! | This American Life". This American Life. 22 July 2011. Retrieved 2016-06-16.
  36. Varchaver, Nicholas (July 10, 2006). "Who's afraid of Nathan Myhrvold?". Fortune.
  37. Sharma, Amol; Clark, Don (September 17, 2008). "Tech Guru Riles the Industry By Seeking Huge Patent Fees" (PDF). The Wall Street Journal. Retrieved June 1, 2009.
  38. United States Court of Appeals for the Federal Circuit (September 30, 2016). "Intellectual Ventures v. Symantec, case 2015-1769" (PDF). Retrieved 5 October 2016.
  39. "Nathan Myhrvold's Intellectual Ventures Using Over 1,000 Shell Companies To Hide Patent Shakedown"
  40. "When Patents Attack". NPR.org. 2011-07-22. Retrieved 2011-07-28. Alex Blumberg, NPR, July 22, 2011
  41. When Patents Attack!. This American Life. Retrieved on 2013-08-16.
  42. Sacca, Chris (April 5, 1994). "When Patents Attack". This American Life (Interview). Retrieved March 30, 2007. @48:44
  43. "Intellectual Ventures registers PAC — Association Trends honors leading lobbyists — FMC adds Seyfert — Steyer's uphill battle". POLITICO. 21 February 2014. Retrieved 2016-06-16.

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