Vlingo today announced it has entered into a partnership agreement with Intellectual Ventures to acquire a significant number of speech recognition patents that it will use to defend itself from what it calls “superfluous litigation.”
Vlingo, which produces speech recognition software for mobiles, just last week filed a counter-suit against Nuance Communication, alleging infringement of five U.S. patents. Vlingo is still in the process of defending itself against a 2008 patent infringement suit filed against it by Nuance.
Vlingo CEO Dave Grannan says that patent infringement cases are on the rise, as companies are increasingly using them as a business tool. “What these companies know is that what they allege in patent infringement doesn’t really matter; just the threat of it will make customers nervous… and they can use that threat to put them out of business,” he said.
Nuance has a track record of filing patent infringement suits against small companies like TellMe and Zi Corporation. In 2008, Zi Corporation rejected a $40.5 million takeover bid from Nuance. A short time later, Nuance sued Zi for patent infringement and later acquired the company for $35 million.
Nuance declined to comment on matters of litigation.
Grannan said he views the trend towards patent litigation as a tactic that stifles competition and innovation across the industry, which is why Vlingo has decided to go on the offensive.
“What we’re doing here with these new patents is defending ourselves,” Grannan said, noting that by acquiring patents through Intellectual Ventures, litigation is more likely to end in a cross-licensing deal.
Joe Chernesky, vice president and general manager of the hardware IP business unit and director of special programs at Intellectual Ventures, said that his company offers customers the confidence of being able to innovate without having to worry about litigation.
Intellectual Ventures claims a portfolio of more than 30,000 patents, which it has acquired by funding invention through different avenues and then acquiring the resulting intellectual property. It can then offer its customers access to those patents. The company has a program for its customers called IP for Defense, which is how Vlingo was able to secure the patents that it recently acquired.
Chernesky said that an aggregation system, like the one Intellectual Ventures provides, offers unique benefits to its customers. “Our customers come to us to have access to all of the great inventions they need to build themselves a great product… They want that because it really reduces the risk, as well as the total cost of patents to them,” he said.
When asked whether he thought patent infringement litigation is being used more now than in the past as a strategic tool, Chernesky said most cases are legitimate.
“I don’t see it as a big part of the industry where bigger companies are asserting patents to disrupt smaller companies… I do recognize for all companies, patents are a risk, patents that you don’t own but that you might be using are a risk and we’ve spent a lot of money acquiring invention and patents in order to provide access to our customers,” he said.
Filed Under: Industry regulations