Google’s “Patent Purchase Promotion” Could be an Opportunity to Sell Your Patent – if You Are Careful!

(Updated May 5, 2015) Google announced this week an “experiment” through which it will consider buying patents that inventors submit to Google via a “streamlined portal.” Google has called this concentrated buying program “The Patent Purchase Promotion,” although Google appears to refer to the program as “Patent Palooza” internally.

Google’s summary is available at:

Patents can be submitted only during a two-week window from May 8-22.

Google will respond to submissions unusually quickly: By June 26th, Google will notify patent holders whether it intends to “pass” on a patent or consider the patent further. By July 8th, Google will notify successful candidates of “tentative interest to purchase.” At that point, patent owners will need to provide any “further information” requested by Google and a “signed agreement.” If Google “remains interested,” it will sign a purchase contract by July 22nd and pay for the patent within 30 days. See

Google will consider only one U.S. utility patent per submission (pending applications, expired patents, and design patents will not be considered). Google says you can submit multiple entries, but the program is not likely suitable for multi-patent “portfolios” because such patents might achieve higher prices via arguments for “synergy” or “portfolio effect” if sold as a group.

Google’s program still provides interested sellers (inventors or assignees) an opportunity to sell single patents and get through the entire process – submission, evaluation, contracting, diligence, and payment – within three months.

So, what’s the catch?

Google writes: “But, please make no mistake: Selling patents is serious business. With this experiment, we are trying to simplify that process, but it is still a process that requires formal agreements that have real implications between you and Google. Just by submitting a patent for consideration, you are agreeing to certain things. … [P]lease consult with a lawyer before proceeding!​” [Emphasis by Google]

We could not agree more!

Should you submit your patent to Google by yourself?

As Google itself says, a patent sale is a formal legal agreement, and you should be advised of its implications. You need a lawyer!

Here are some of the points that patent owners interested in this program should consider, and on which they should obtain legal advice:

1. Submission binds you to sell
Google says, “Just by submitting a patent for consideration, you are … agreeing to sell Google the patent … if Google chooses to transact with you.” If you back out later, in theory Google could sue you for contract breach or force you to complete the transaction. In effect, you are giving Google a free “option to purchase” your patent for a limited time.

Have you considered the implications?

If your patent is for sale, might a different company consider buying it for a higher price? Might it be possible to get a “bidding war” going, where more than one company places offers? Is near-term litigation – that could block you from selling – possible?

These are just a few of the many other considerations that require expert legal advice.

2. The price you state is a “buy it now” price, which Google can accept

Google says, “Just by submitting a patent for consideration, you are … agreeing to sell Google the patent at the amount you indicate in your submission if Google chooses to transact with you.” Apparently, Google intends to ask you to state your price for the patent when you submit it.

If you state a low price, to interest Google, and Google accepts, you cannot negotiate the price higher now that you know the company is interested. Are you sure that you can price your asset without “underpricing” its value?

Don’t just guess! Set your price with the benefit of expert advice from a seller representative (1) knowledgeable of the patent-sales market, and (2) capable of advising you of how “strong” your patent is, and how valuable it is.

Only a lawyer knowledgeable of the patent-sales market can both analyze your patent and help you price it, so you don’t “sell yourself short.”

3. If you “overprice,” Google won’t buy
Many inventors, on the other hand, have the opposite problem: They think they own a patent to the next “billion dollar idea,” so they overprice their patents. Google has a simple solution to attempts of this sort: Just say no! In other words, Google can refuse to acquire your patent, and it will clearly be looking for the cheapest patents available during the window. If you have unrealistic expectations and overprice, you are wasting your time and effort.

Advice from a patent lawyer with knowledge of both the general marketplace for patents and Google’s own pricing goals can help you.

4. Google will not negotiate its purchase contract – do you understand it?
Google posted a purchase contract on the website in connection with the announcement.

Its posts say that patent owners will agree to the contract merely by offering a patent through the Google portal. Does that mean that you can proceed without a lawyer, because it won’t matter anyway? Not at all. Read Google’s caution (quoted above) again. A sales agreement is a formal legal document, and only a lawyer can advise you about its implications.

For example, Google’s contract contains provisions about the following subjects:

  • third party licenses
  • license-back to seller
  • representations and warranties
  • implications for other patents that are part of the same “family” as the one you offer
  • litigation/accusations of infringement
  • sellers located outside the United States

You need to know whether you are willing and able to agree to Google’s terms, before you push the “submit” button on Google’s website. Only a trained lawyer can advise you on such questions.

5. If you can’t close, you are wasting your time
As explained in the process summary above, if Google is interested in your patent, it will do a “due diligence” review of your documents. Google will want to know about the patent ownership and make sure that your patent is in “good shape” for sale.

Hoffman Patent Firm has participated in literally scores of closings for patent transactions. Nearly never is a patent sale so truly “clean” as to require no action during the diligence phase. Cleaning up a sale is usually possible, if you have skilled representation.

You can wait to see if Google will express interest, and consider diligence matters at the time, but what if your patent has an issue that cannot be solved? You have promised Google you will be ready to sell, but you can’t. Isn’t it wiser to consider any issues up front, and know whether you will be in a position to close? We think so.

6. Submission could have implications for later patent-infringement lawsuits
If Google doesn’t buy your patent, and you later use it to sue someone (not necessarily Google) for patent infringement, what are the implications? The program rules do not prevent you from suing Google later, but they contain a restriction that submission does not act as “notice” of the patent to Google for purposes of a later lawsuit. Also, the price you place on the patent is of questionable secrecy, and such evidence could have litigation implications. These are just a few of the consideration that require expert legal advice, from a lawyer knowledgeable of the practicalities and rules of patent-infringement litigation.

What type of representative do you need?

When considering what representative to hire, here’s a list of simple questions to ask:

  1. Are you a lawyer?” (A non-lawyer cannot advise you about a contract – doing so would be “unauthorized practice of law” and against the law. Many representatives, called “patent brokers,” are non-lawyers.)
  2. If yes, are you a patent lawyer?” (Only a patent lawyer – someone admitted to practice before the USPTO – is qualified to evaluate the scope and meaning of a U.S. patent and advise you of its likely strength, applicability, and quality.)
  3. If yes, are you going to represent me in a legal capacity?” (There are some lawyers who will represent you only in a non-legal business capacity or via a company that is not a law firm. In such situations, your representative may be a lawyer, but they are acting in an advisory, business capacity and not allowed to give you legal advice.)
  4. If yes, do you have knowledge and experience of the market for patent sales in general?” (There are thousands of patent lawyers, but you can count on a few fingers the people who are involved in the “patent sales market.” A patent lawyer without those skills might be able to give you excellent advice, but they simply lack the knowledge about past pricing and trends.)
  5. If yes, have you made sales to Google specifically?” (Knowing Google’s practices specifically can be helpful.)
  6. If yes, are you admitted to practice in California?” (Google’s sales agreement applies California law. A lawyer licensed in a different state should not be advising you.)
  7. If you are a non-US seller: “Have you sold patents for sellers located outside the U.S.?

The Hoffman Patent Firm can answer “yes” to all seven of those questions. There are not many representatives around, if any, who can answer the same.

How Can the Hoffman Patent Firm Help Me?

The Hoffman Patent Firm will offer an initial free consultation to any patent owner interested in participating in the Google patent sales program. This will require disclosing a U.S. patent number to our firm and arranging a time to speak by phone for a limited time.

There is no obligation to hire us. If you like what you hear and we agree to represent you, we will offer you legal representation – according to a signed, legal representation agreement – before, during, and to some extent after the Google program, including:

  1. A contingent-fee representation. You will pay us nothing unless Google buys your patent.
  2. Advice on whether it is a good idea to submit your patent to Google – is it right for your situation?
  3. Advice on what price to name, if you decide to submit your patent to Google under the program.
  4. If Google expresses interest, assistance with the process of submitting further information, negotiating contract terms (if it is possible to do so or required), and handling “due diligence” issues raised by Google and required to close.
  5. A reduced percentage fee. In honor of Google’s attempt to “streamline” the process, we will charge a sharply lower percentage for any patent sold to Google during its “Patent Purchase Promotion” than our normal charge for patent sales.
  6. If submitting to Google is not right for you, or if Google doesn’t want to buy your patent through this program, advice on whether you should sell elsewhere. If we both decide this is a good idea, then we will assist you with a more comprehensive patent-sales project, for a rate higher than the Google-only rate but still lower than our normal charges for patent sales.
  7. If required and desired, other patent-law services. Our firm is qualified to provide services in patent prosecution, litigation and licensing, or general IP advice. If you need such additional services, we can consider it.

What’s the Next Step If I’m Interested?

Contact us by email or through this link.

But do so soon, because Google’s program is a short-term opportunity. There are only three weeks to submit patents (the portal will close on May 22, 2015).

What If I Missed the Opportunity?

If you have a patent to sell but missed Google’s window, you can still contact us for advice. Google may repeat this program, if it proves successful. Even if not, other buyers exist for good patents. Please feel free to ask us if we can help you.

Louis is a patent attorney and president of Hoffman Patent Firm. His full bio can be found here.

Posted in Patent Buying Activity


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