A new startup company wants to have a say in the high-stakes patent disputes that loom over many industries.
In the drug business, for instance, Pfizer Inc. is suing generics maker Teva Pharmaceutical Industries, accusing it of infringing on a patent covering Pfizer's top-selling cholesterol medicine.
In high-tech, Research In Motion Ltd. is locked in litigation with Motorola Inc. over patents central to wireless devices. And in the video game market, Konami Digital Entertainment, developer of "Rock Revolution," is pushing a patent infringement case against Harmonix Music Systems, creator of the game "Rock Band," and its corporate parents, MTV Networks and Viacom Inc.
Now the startup, Article One Partners, is offering a reward to anyone who can turn up evidence to settle whether the patents at the heart of these cases — along with a handful of other valuable, high-profile patents — are valid or not.
Article One Partners, which launches Monday, hopes to use the Internet to create a global community of experts to review patents issued by the U.S. Patent and Trademark Office. The idea is to tap the wisdom of the online masses to unearth "prior art" — evidence that an invention is not novel and therefore doesn't deserve a patent — that the Patent Office may not have known about when it approved the application.
To encourage people to take part, the company is offering both a profit-sharing program as well as payments of up to $50,000 to anyone who uncovers evidence that could be used to invalidate a patent. Article One Partners hopes to make money by selling the information it gathers to interested parties — often those involved in infringement suits — and by making market trades based on the information.
Company founder Cheryl Milone said Article One Partners plans to focus on "patents that have the greatest economic impact," particularly those that cover valuable products, are involved in costly infringement lawsuits or are in the hands of holding companies that reap royalty payments from others.
While the company's work could help invalidate some high-profile patents, it could help strengthen the legitimacy of others, noted Milone, an attorney who practiced patent law for 12 years.
Article One Partners is one of several efforts to improve patent quality and help fix an overburdened patent system that is often accused of granting too many patents of dubious merit that wind up in court.
The company hopes to build on the progress being made by Peer-to-Patent, a program run by New York Law School that publishes patent applications online in order to gather prior art to be passed along to the Patent Office during the examination process.
But there is one key difference. Unlike Peer-to-Patent, Article One Partners offers people a financial incentive to donate their time and expertise. "We feel people should be compensated for the value of their information," Milone said.