Intellectual Ventures is not dead, but it may be dying. This will come as good news for the tech companies and start-ups that have been taxed directly or indirectly by IV, which has done more than any other company to popularize the ugly business of patent trolling.
According to a BusinessWeek report, IV has been inventing nothing but pink slips of late:
On Tuesday, IV sent a memo to its workers, notifying them of the cuts. The company has been employing 700 people, which means about 140 will be let go. “We are making operational changes that are consistent with this reduction and will enable us to maintain and expand our leadership in the market for invention,” the company said in a statement. “Our assets — both people and intellectual property — are among the best in the industry.”
In case you’re unfamiliar with IV, the company was founded by former Microsoft executive Nathan Myhrvold and spent its early days amassing tens of thousands of patents. For a time, IV gulled the press and public with stories about crowd-sourcing genius and curing malaria, but soon its true colors — those of a patent troll — emerged.
As scholars have explained, IV’s primary activity has been arming thousands of shell companies with old patents in order to extort licensing fees from companies small and large. Growing disgust with IV’s business model, however, have led early investors like Google and Apple to wash their hands of the troll, and for Silicon Valley to press the case for patent reform.
In response, IV has doubled down on its lobbying efforts in Washington, starting a PAC for patent trolls in February. It has also retained a robust public relations division, cranking out a regular stream of press releases and blog posts to hail real inventors.
While the reported layoffs of about 20 percent of its workforce are a sign that Intellectual Ventures may finally be out of gas, the tech sector shouldn’t breathe easy just yet. Last month, an intellectual property broker reported that IV has re-upped with hundreds more patents, meaning the patent troll nightmare is unlikely to end anytime soon.