Coalition Funding Initiative: Launching Phase 1 for the CryptoPeak Case

Many of you may have seen Patexia’s announcement in Inside Counsel this September launching our Coalition Funding Initiative (CFI). We are now proud to announce that we are progressing with the next phase of our first case under the initiative. The case, filed by CryptoPeak Solutions, a non-practicing entity, names over 60 defendants including AT&T, Yahoo, Netflix, GoPro, Etsy, and Pinterest. Looking at the cases filed using this patent alone, CryptoPeak is responsible for more than 1% of lawsuits  filed so far in 2015. Filing began in July, then accelerated again in November. While some defendants have already settled, Patexia is moving forward with a select group of interested defendants.  Phase 1, a crowdsourced prior art search, has been launched to gather the prior art needed for the next phase, an IPR at the Patent Trial and Appeal Board.

In the IP industry we routinely see patent suits simultaneously targeting a large group of companies with a single patent. By uniting defendants to collaboratively fund the patent validity review, the CFI offers a more efficient and cost effective solution for defendants, while also permanently removing weak patents from the system. Patexia monitors new patent litigation across industries and when a case is filed, Patexia immediately reaches out to the targeted companies to bring them together and form a defense coalition. Then, using proven crowdsourced patent validity analysis techniques with a 75% success rate based on client feedback, Patexia searches for prior art. If strong art is found by the crowd, bringing the quality of the patent into question, Patexia will then partner with experienced legal counsel to take the case to the Patent Trial and Appeal Board for an inter-partes review.

By working with the CryptoPeak defendants as a group, each company is able to share the burden they would otherwise face alone. Total litigation costs can spike into the millions for a single defendant, which is why many companies decide to settle. By joining a Patexia defense coalition, companies can turn their resources back towards positive innovation, benefiting the economy.