Canon and Google Fight to Limit Patent Claims

Companies tired of defending themselves against what they consider to be baseless patent lawsuits are hoping a plan hatched by Google and Canon will limit their exposure to future claims and millions in legal bills. The two companies, among the top recipients of U.S. patents last year, have created the License on Transfer Network, an alliance of patent-holding companies that have been or could be the target of patent-infringement lawsuits. Members of the network will pledge that if they sell their patents, others in the alliance will automatically get a royalty-free license to the protected technology, making participants immune to patent claims. “The hope is, people will see the benefits of the network effect here, and the cycle of selling patents to licensing companies will end,” says Eric Schulman, the director of patents at Google.

Four other companies are participating in the program announced on July 9—software maker SAP, Internet retailer Newegg, data-storage company Dropbox, and Asana, a software designer started by Facebook co-founder Dustin Moskovitz. The six companies hold almost 300,000 patents and patent applications, Schulman says.