Canada-based telecom Nortel went bankrupt in 2009 and sold its biggest asset—a portfolio of more than 6,000 patents covering 4G wireless innovations and a range of technologies—at an auction in 2011.
Google bid for the patents, but it didn’t get them. Instead, the patents went to a group of competitors—Microsoft, Apple, RIM, Ericsson, and Sony—operating under the name “Rockstar Bidco.” The companies together bid the shocking sum of $4.5 billion.
Patent insiders knew that the Nortel portfolio was the patent equivalent of a nuclear stockpile: dangerous in the wrong hands, and a bit scary even if held by a “responsible” party.
This afternoon, that stockpile was finally used for what pretty much everyone suspected it would be used for—launching an all-out patent attack on Google and Android. The smartphone patent wars have been underway for a few years now, and the eight lawsuits filed in federal court today by Rockstar Consortium mean that the conflict just hit DEFCON 1.
Google probably knew this was coming. When it lost out in the Nortel auction, the company’s top lawyer, David Drummond, complained that the Microsoft-Apple patent alliance was part of a “hostile, organized campaign against Android.” Google’s failure to get patents in the Nortel auction was seen as one of the driving factors in its $12.5 billion purchase of Motorola in 2011.
Rockstar, meanwhile, was pretty unapologetic about embracing the “patent troll” business model. Most trolls, of course, aren’t holding thousands of patents from a seminal technology company. When the company was profiled by Wired last year, about 25 of its 32 employees were former Nortel employees.
The suits filed today are against Google and seven companies that make Android smartphones: Asustek, HTC, Huawei, LG Electronics, Pantech, Samsung, and ZTE. The case was filed in the Eastern District of Texas, long considered a district friendly to patent plaintiffs.