Facebook has reportedly acquired patents from IBM, a move that could help it shore up defenses against new patent infringement lawsuits ahead of its IPO.
The social networking company confirmed the purchase, and said the patents cover software and networking technologies, The New York Times reported on Thursday. Facebook did not disclose how much it paid for the patents or the patent numbers. Bloomberg reported earlier in the day, citing an unnamed source, that Facebook acquired 750 patents from IBM.
Just last week Yahoo accused Facebook of infringing ten of its patents, in a lawsuit filed in California. Yahoo may have hoped that Facebook would settle quickly, experts said, in order to remove an uncertainty that could negatively impact its public offering. Since Facebook hasn't named the IBM patents, it is unclear if they would help the company in any settlement negotiations.
The company did not immediately respond to a request for comment.
"This acquisition of patents by Facebook shows the immense value attributed to patents in the Internet sector," said Mark Kenrick, partner at Marks & Clerk LLP. "Companies are keen to obtain substantial portfolios for both offensive and defensive use. Indeed, Yahoo's recent action against Facebook might be seen as something of a catalyst for this latest acquisition.
"The attitude of the major Internet players provide clear opportunities for smaller Internet businesses as it provides a clear market place in which they can market their technology and patent portfolios. Internet innovators should not underestimate the value of Intellectual Property in this burgeoning sector which is attributing ever increasing value to patent protection," Kenrick added.
IBM is one of the biggest patent holders in the US. For the 19th year running, in 2011 it won the most patents among IT companies. But it has been offloading patents too. Google last year acquired over 1,000 patents from IBM.
Relative newcomers to the technology industry, Google and Facebook lag behind older companies like IBM, Microsoft and even Yahoo in terms of a patent portfolio. In an increasingly litigious environment, that makes Facebook an easy target for patent infringement suits.
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