Lenovo buying thousands of NEC patents

04/06/2014 5:27 PM

04/06/2014 5:28 PM

Lenovo has agreed to acquire thousands of patents from Japanese technology giant NEC, further expanding its intellectual property portfolio in support of its burgeoning smartphone business.

Lenovo is buying a portfolio of more than 3,800 patent families from NEC, which last year decided to exit the smartphone business, for an undisclosed price. A patent family is an invention that has patent protection in multiple countries.

The NEC agreement and a $100 million patent deal that Lenovo announced last month are strategic moves designed to deter patent lawsuits from competitors as the company ramps up its smartphone business, said Ira Blumberg, vice president of intellectual property.

“We want to be free to innovate, not litigate,” Blumberg said in an interview.

Lenovo, the world’s No. 1 PC maker, will become the No. 3 smartphone maker when it completes its acquisition of the Motorola Mobility business from Google. Completion of that deal also will put Lenovo in the U.S. smartphone market for the first time; it already sells smartphones in China and other markets.

Lenovo is based in China and has about 2,200 workers at a headquarters in Morrisville.

The Motorola acquisition includes more than 2,000 patents that provide “very, very good protection” from lawsuits, but Blumberg said Lenovo decided that expanding its smartphone patent portfolio further makes a lot of sense. A majority of the NEC patents are smartphone-related.

“It’s a space where it’s very important to have solid patent support,” Blumberg said. “We see there is plenty of litigation in the mobile phone space between and among competitors and recently departed competitors.”

Last month Lenovo acquired a group of patents and licensed others from Nevada-based Unwired Planet for $100 million. Unwired, which is publicly traded, has been labeled a “patent troll” by critics because its sole business is exploiting its patent portfolio.

Patent trolls, also called nonpracticing entities, or NPEs, are quick to sue companies for patent infringement. But Blumberg said Unwired never threatened any litigation.

“This was a deal that made sense to both parties,” he said.

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