ANAHEIM, Calif. (January 22, 1999) -- The Patent and License ExchangeSM patent auction market ("plXSM"), today released its plans to open the first business-to-business global Internet-based auction facility for the safe and efficient transfer of quality patents and licenses. Company founder and CEO Nir Kossovsky delivered details about the new exchange in a symposium entitled "Breaking the University-Industry Technology Transfer Logjam," at the American Association for the Advancement of Science ("AAAS") annual meeting.
According to Kossovsky, "patents are the most valuable asset a business can have today -- they fuel the global economic engine." Currently, more than 600,000 patents are available for license or sale. An additional 265,000 patents join that global inventory annually. On average, a patent will be three years old before it is sold or licensed. Kossovsky adds, "currently, everyone in the value chain loses: inventors, patent owners, businesses, and the public, as they are all deprived of the benefits of novel products and the associated revenues." The cash value of this loss is more than $500 million annually.
"The Patent and License Exchange global auction market will do for patents what the Chicago Board of Trade did for grain in the late 19th century," said Kossovsky at the AAAS symposium. "Patents are not commodities -- they are a set of rights which in an efficient market, could be nearly as liquid as financial instruments." There are two reasons today why the patent market is inefficient. First, buyers and sellers can't find one another. Second, when they do, buyers end of up assuming most of the risks. plX solves these problems through a sophisticated searchable database with standard disclosures, a transparent pricing model, and new patent insurance products.
The patent auction market's key success factor is the quality of its participants. plX invites world class global law firms, universities, government research laboratories, research institutions and commercial banks with patent inventories, and companies with new product needs, to qualify for an electronic seat. Seat holders will include owners of quality patents, businesses with a track record for patent development, and global law firms representing buyers and sellers.
Among the unique features of the plX auction market are its risk transfer solutions. Providing patent insurance creates a more risk-free marketplace by reducing the risk that buyers and sellers bear in each patent sale. The company is currently talking with Swiss Re Group about creating a complete package of patent validity, infringement, and enforcement insurances. According to Bill Hoffman, Associate Director of Integrated Risk Solutions, Swiss Re New Markets, "pending the approval of our executive board, we will provide innovative patent insurance products for plX to facilitate the safe and efficient commercial transfer of quality patents and licenses. Patent insurance is a new area for the insurance industry and one we believe has significant growth potential."
Swiss Re New Markets is a division of Swiss Re Group. Swiss Re Group is one of the world's leading and financially strongest reinsurers with gross premiums of $11.94 billion in 1997. Standard & Poor's assigns the company its "AAA" rating and Moody's rate it "Aaa." According to Kossovsky, "Swiss Re is the ideal exclusive strategic partner for plX patent insurance because of its tradition of creative, high-capacity risk management and innovative risk products."
plX is also talking with Chicago Title Insurance Company about developing a new patent escrow product. According to Sharon Yarber, Senior Legal Counsel, "real estate escrow helps reduce transaction risk by providing a secure service for the exchange of money and documents. The innovative patent escrow products we are creating for plX will reduce certain risks for patent buyers and sellers." Chicago Title is one of the largest title companies in the United States. Yarber says that the company's goal is to provide patent escrow services to both national and international plX customers through its centralized escrow services based in Los Angeles.
Founded in 1999, The Patent and License Exchange is headquartered at 225
South Lake Avenue, Suite 300, Pasadena, Calif., 91101, 626-405-0690,
info@pl-x.com. plX is the first global
business-to-business Internet-based auction facility for the safe, and efficient
commercial transfer of quality patents and licenses. plX provides global
customers with easy-to-search patent inventory, on-line bid placement, secure chat
room negotiation, closing services (escrow) and aftermarket license administration.
For more information, please visit the company's Web site at www.pl-x.com.