Wednesday, September 03, 2014

How much will China's Ruichuan IPR Funds resemble Intellectual Ventures?

There has been discussion of China's Ruichuan IPR Funds .

For example, in June 2014, IAM wrote:

Last month, IAM reported on the launch of Beijing-based patent aggregation entity Ruichuan IPR Funds. At the time, facts about its plans and structure were thin on the ground; but, with the help of contacts in the Chinese IP marketplace, I have been able to piece together some additional detail on the entity and its objectives.


Haidian-based broker China Technology Exchange (CTEX) has already assisted Ruichuan on patent acquisitions. “The fund will purchase patents in the fields of smart devices and mobile internet,” CTEX vice president Josh Li told IAM. “It is interested in both overseas and domestic patents.”

One head of IP at a Chinese corporate told me that Ruichuan’s initial objective is defensive, but things could quickly become more complex as it tries to secure a return for its investors and further its strategic goals. “To my knowledge, the fund is focused on defence in the beginning, in order to help Xiaomi and other Chinese companies pave their way into overseas markets,” he explained. “In order to build up a strong patent portfolio, they will also invest a lot in third-party R&D, including working with universities and research institutions in China, acquiring innovations, and so on. I think it could be more like IV [Intellectual Ventures] by that stage.”

These aims are reflected to an extent in Ruichuan’s management team. The entity’s general manager is Lin Peng, a former executive director of patent licensing at Intellectual Ventures who has also held roles at Microsoft and Cargill, among others. Lin is also president and chief operating officer at Zhigu IP, the firm that is behind the creation of Ruichuan. Zhigu’s chairman is Zhang Hongjiang, who is also CEO of internet business Kingsoft. (It is also worth noting that the head of IP at Xiaomi, Zhang Liang, is another IV alumnus.)

Jack Ellis
IAM Magazine
19 June 2014

In July 2014, Breitbart posted something from Timothy B. Lee:

And this spring, China descended to new depths by launching a state-funded and -operated patent assertion entity (PAE) named Ruichuan IPR Funds. In addition to distorting free trade and global free markets in favor of Chinese industry via government support, the new PAE will likely engage in that familiar habit of hacking and espionage against non-Chinese enterprises. The new PAE also demonstrates that the perceived problem of "patent trolls" can no longer be considered merely a private sector threat.
Now faced with the threat of foreign trolls such as Ruichuan IPR Funds, American companies may find themselves warding off more than just the typical domestic patent troll lawsuit. Instead, they'll also find themselves defending their operations against entities backed by the resources and force of foreign governments – a very unfair battle of resources.

As to IV, recall the history of US 6182894 :

Intellectual Ventures I LLC and Intellectual Ventures II LLC (collectively,
“IV”) sued PNC Financial Services Group, Inc. and PNC Bank, N.A. (collectively,
“PNC”) on May 29, 2013. IV alleges that PNC’s Visa Check Card system/service
infringes 15 claims of U.S. Pat. No. 6,182,894 (“the ’894 patent”), which has a filing
date of October 28, 1998. See Ex. 1006 at ¶¶ 32-37; Ex. 1009 at 1. Two weeks later,
on June 12, 2013, IV sued Bank of America Corporation and Bank of America,
National Association (“BANA”) for infringement of at least claim 18 of the ’894
patent in the Western District of North Carolina.

In its Final Written Decision, the Board granted entry of adverse judgment against Patent Owner and cancelled claims 1-18 of the ’894 Patent


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