Apple/Microsoft 'Rockstar Consortium' Considering Patent Sale

In 2011, Apple teamed up with companies like Microsoft, Ericsson BlackBerry, and Sony to form a consortium to purchase a collection of 4,000 patents and patent applications for $4.5 billion from Nortel, a communications company that went bankrupt in 2009.


The team of companies, called the "Rockstar Consortium," is now holding discussions on a potential sale of a portion of those patents, reports Bloomberg, after attempts to land large licensing deals for the patents have failed.

The group, called Rockstar Consortium, has recently been in conversations with possible buyers about the patents, said the people, who asked not to be identified because the information isn’t public. Rockstar, which also includes BlackBerry Ltd. (BBRY), Ericsson AB and Sony Corp., has had little success in landing large licensing deals for the patents, three of the people said.

Back in 2012, Nortel’s portfolio of patents was highly sought after, with the Rockstar Consortium entering into an ongoing bidding war with Google, another technology company that was also after the patents.

A buyer, or several buyers, could acquire Rockstar’s patent portfolio excluding those involved in the lawsuits, two people said. Because Rockstar bought the Nortel patents at a high price and doesn’t want to sell them at a loss, the deals could be structured to take advantage of any future financial gain enjoyed by the buyer, the people said.

Another scenario would involve a third party joining the consortium to dilute existing investors, without involving a sale of particular patents, said one of the people.

According to Bloomberg, several of the patents have already been sold and earlier this year, reports indicated that the consortium filed suit against Google, Samsung, HTC, Huawei, and others for patent infringement on the Nortel portfolio. Apple and other Rockstar Consortium shareholders were reportedly not involved in the decision to sue.

The patents currently for sale are not the patents involved in the October lawsuit.