Kodak To Auction Patent Portfolio
June 14, 2012

Kodak To Auction Patent Portfolio

Derek Walter for redOrbit.com

Eastman Kodak, once the king of photography, filed a motion this week to auction off more than 1,100 patents from its expansive portfolio.

It will be accepting sealed bids during the next month, with plans to announce a winner by August, 13, the company said in a statement.

Eastman Kodak, which now specializes in printing equipment, said that 20 parties have expressed interest. However, it is only the winner who will be published in order to ensure there is no public bidding war.

“The proposed structure of the auction is tailored to the special nature of the assets,” said Timothy M. Lynch, Kodak Vice President and Chief Intellectual Property Officer in a statement. “The bidding procedures are designed to allow bidders to give us their best offers without fear of showing their cards to competitors. In filing these proposed procedures in advance of the June 30 deadline in our lending agreement, we are moving ahead as quickly as possible with the process of monetizing our digital imaging patent portfolio.”

Kodak filed for bankruptcy protection in January. Shortly afterwards it stopped making digital cameras.

The litigious nature of the patent world has made a strong portfolio an important tool for companies. However, some have raised concerns about the strength of Kodak´s patents.

For example, the U.S. International Trade Commission (ITC) ruled in May that one of the company´s “preview images” was invalid because of its “obviousness.”

LG and Samsung had previously paid $964 million to use the technology. Kodak was trying to push Apple and Research in Motion, the maker of BlackBerry devices, to do the same. Kodak has announced that it plans to appeal the decision.

The motion for selling the portfolio was filed with U.S. Bankruptcy Court for the Southern District of New York. If approved, the company plans to split its patent portfolio into two bundles.

One of the portfolios will have about 700 patents that cover image capture, processing, and transmission technologies. They apply to both digital cameras and various types of other devices.

The other batch will include tools for image editing, tagging, and their use in connected services.

This is not the first time that Kodak has been involved in licensing its patents. The company revealed in the finding that it has generated more than $3 billion in revenue during the last 10 years.