Patent trolls now own a large collection of legacy patents involved with mobile technologies, following a $600 million sales of those patents by Blackberry. This will likely result in more patent infringement lawsuits for Apple and other smartphone makers in the future.
Blackberry announced on Monday that it had agreed to a sale agreement with the former leading smartphone maker selling its non-core patent assets to Catapult IP Innovations for $600 million. The transaction will see BlackBerry receiving $450 million in cash and a promissory note for $150 million, as well as a license for the patents.
The array of patents is related to mobile devices, messaging, and wireless networking IPs. BlackBerry says that the sale will not affect customers using its products or services. However, it is likely to spell trouble for other tech firms, like Apple and Samsung.
Catapult IP Innovations is “a Delaware company” that is a “special purpose vehicle formed to acquire the BlackBerry patent assets.” The company is funded by a $450 million senior secure loan, which includes $400 million of “conditional commitments from a lending syndicate” led by Third Eye Capital.
Catapult IP Innovation could be considered a “non-practicing entity,” which is a company that does not earn revenue from selling products or services, but instead earns by enforcing the usage of patents it owns. Companies like this are also known as “patent trolls.”
The patents will be used to encourage royalty payments from device producers, likely through the threat and filing of lawsuits.
Completion of the transaction is conditional upon, among other things, the satisfaction of all regulatory conditions under the Hart–Scott–Rodino Antitrust Improvements Act in the United States and the Investment Canada Act. This process could take up to 210 days.