Patent pool

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In patent law, a patent pool is a consortium of at least two companies agreeing to cross-license patents relating to a particular technology. The creation of a patent pool can save patentees and licensees time and money. Competition law issues are usually important when a large consortium is formed. Patent pooling has recently become a hotly debated field.

For instance, in August 2005, a patent pool was formed by about 20 companies active in the Radio Frequency Identification (RFID) domain [1][2]. The RFID Consortium picked Via Licensing to administer its patent pool in September of 2006 [3].

One of the first patent pools was formed in 1856, by manufacturers Grover, Baker, Singer, Wheeler, and Wilson, all accusing the others of patent infringement. They met in Albany, New York to pursue their suits. Orlando B. Potter, a lawyer and president of the Grover and Baker Company, proposed that, rather than sue their profits out of existence, they pool their patents (See also: Isaac Singer/I. M. Singer & Co).

A difficult situation may happen when two or more different patent pools hold patents on the same technology or when some patent holders refuse to join an industry patent pool. Patent pools typically do not indemnify licensees against claims of infringement of patents that are not included in their pool, and also typically cannot force anyone to join their pool. Examples of well-known such cases include the MPEG-2, MPEG-4 Part 2 and H.264 video coding standards, and the DVD6C pool.