Defensive Patent Acquirer is Going Public

RPX Files S-1 with the SEC

It’s amazing what you can learn, or infer, from a Securities and Exchange Commission S-1 registration statement, which RPX has filed in order to sell $100 million worth of shares to the public.

Lead underwriters Goldman Sachs, Barclays Capital and Allen & Company all are stellar financial advisors and selective about whom they do business with. A good sign.

RPX recorded $10m in profits for first nine months of 2010 on about $65m in revenues, and has 70 clients.

The company estimates that “litigation-related expenses in the patent market totaled tens of billions of dollars in the United States from 2005 to 2010.”

I didn’t have time to go over the registration carefully. However, those of you interested in patent infringement and IP business models might want to take a closer look. S-1 registration disclosure details are often revealing.

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RPX has done quite well over the past 24 months, achieving significant growth and profit. I wish them success. It is unclear how much of the company is being sold at this time. Time will tell to see to what extent the business is scalable and how attractive its model is to investors. Continued performance will help.

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  1. One must assume that, although RPX had in the past committed to stockpiling patents for “defensive” purposes only, this new change in structure may well lead to a change in the company approach toward patent enforcement. Ever since Intellectual Ventures finally started suing, I no longer believe the claims of any entity that it is obtaining patents for “defensive purposes only.” Will RPX 2.0 be able to resist the siren song of patent litigation?


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