Frequently Asked Questions

RPX is a Delaware corporation. Like all other for-profit Delaware corporations, RPX is controlled by its Board of Directors and its shareholders. RPX is not a trade association or a non-profit organization.

No. RPX is an independent corporation that does not have any authority to act as an agent on behalf of RPX members or to bind our members. Similarly, RPX members do not control or have the authority to act on behalf of RPX.

No. RPX is an independent corporation that does not have any authority to act as an agent on behalf of any patent owners or to bind patent owners. Similarly, patent owners do not control or have the authority to act on behalf of RPX.

RPX makes independent decisions, including pricing, regarding patent transactions based on RPX’s own internal criteria, with ultimate authority for transactions resting with RPX’s management and its Board of Directors. RPX’s acquisition of patent rights is constrained by the available supply of those rights (i.e., whether a particular patent owner is willing to grant patent rights to RPX at a price that RPX is willing to pay). RPX’s decision to acquire patent rights is further informed by the demand for patent rights (i.e., whether and to what extent those patent rights are valuable to RPX members). However, members do not approve or veto RPX decisions to enter into RPX patent transactions. Of course, RPX cannot initiate a transaction on its own; any particular transaction requires as a necessary first step the patent owner’s willingness to discuss a transaction with RPX because the patent owner perceives the RPX model to be an efficient way to achieve the patent owner’s goals.

RPX funds most transactions using its own balance sheet. For transactions that require capital in amounts that are greater than RPX can fund with its own balance sheet, RPX may finance the transaction through contributions from RPX members. A transaction that is financed (whether wholly or partially) through contributions by RPX member is referred to by RPX as a syndicated transaction.

RPX has been a pioneer in creating licensing efficiencies, and one of the most effective mechanisms for generating savings for our members is the syndicated transaction. A syndicated transaction is a patent license or acquisition transaction that is facilitated by RPX and for which one or more RPX members make a contribution in addition to their then-current annual membership and license fee. Syndicated transactions allow RPX flexibility to try to create the most value for all parties interested in particular rights and come in a myriad of shapes and creative deal structures to accommodate whatever issues are unique to any given patent portfolio or transaction.

From time to time, our members ask us to pursue patent rights that RPX would not otherwise acquire under the standard membership model. Typically, these rights are higher cost and apply to only a subset of our members. In these instances, we might facilitate syndicated transactions. Similar to other acquisitions, these syndicated deals are designed to share resources efficiently and collectively reduce litigation risk. These transactions also provide an efficient licensing opportunity for patent owners, given the ability to license multiple RPX members in one transaction, saving on transaction costs and often avoiding or resolving costly and time-consuming litigation.

Not always. Generally, an RPX member will receive rights through a syndicated transaction if one or more of the following circumstances applies: 1. The member makes a syndicate contribution in cash in addition to its annual subscription fee. 2. The member commits to a membership extension, which enables RPX to make an upfront syndicate contribution on behalf of the member while recovering the payment from the membership fee at a later date.
3. The membership and license fee paid by the member is sufficiently high that the cost of securing a license can be absorbed under the membership rate without compromising fairness for other members. 4. The member could be included because the patent owner did not attribute substantial licensing value to the member in question (this typically occurs when the patent owner does not consider a member as a potential litigation target and thus does not perceive a grant of license rights to have a material impact on licensing revenue potential). RPX always seeks the broadest rights we can obtain for our members given the resources that are made available to us and the willingness of the patent owner.

Yes, absolutely. RPX negotiations are never exclusive. RPX members and prospects are always free to negotiate directly with patent owners. In fact, we encourage companies to do so, as we always want all parties to understand that RPX is just one alternative to a bilateral transaction between an RPX member and a patent owner. Although RPX transactions are typically more efficient than bilateral transactions for RPX members and patent owners, there are many instances when a direct bilateral transaction between an RPX member and a patent owner will make more sense for that RPX member and patent owner.

Yes, absolutely. RPX negotiations are never exclusive, and the reasons stated in the prior answer above apply equally to patent owners.

No. RPX transactions are optional alternatives to bilateral or other licensing, and if any patent owner or RPX member is not interested in pursuing an RPX transaction for any reason, they are always free to decline to do so.

The reasons a patent owner may wish to pursue a transaction with RPX are many. These include the fact that RPX transactions afford patent owners with an efficient path to licensing at scale. Patent owners can license multiple RPX members through a single negotiation with RPX, delivering a pragmatic licensing solution that saves on time, transaction costs and legal fees, while also reducing business uncertainties and friction inherent in litigation as a patent monetization strategy.

No, RPX is not an LNG. RPX is an independent company, and RPX does not participate in LNGs. RPX aggregates licenses and licensees, serves as an independent intermediary in transactions (licensing in patent rights from a patent owner and granting those licenses to RPX members as sublicenses), and provides services to RPX members. As discussed above, RPX enters into transactions with patent owners, and then enters into separate transactions with each RPX member. RPX negotiates with each member individually, not as a group. RPX’s status as an independent intermediary thus allows for RPX to serve as a procompetitive and optional alternative to a bilateral transaction between the patent owner and individual RPX members.

RPX transactions do often result in dismissal of patent litigation between the relevant patent owner and RPX members because a license has been secured, which is one of the main benefits of such transactions and a huge value to RPX members and patent owners. However, because RPX has no authority to direct the actions of any RPX members or patent owners, RPX itself has no authority to settle litigation between RPX members and patent owners. RPX transactions (particularly syndicated transactions) are often extraordinarily complex with multiple interdependencies. As a result, no party to any litigation should take any action in reliance on an RPX transaction until the final fully executed binding definitive agreement for that transaction becomes effective (at which point, patent owners may be contractually obligated to file litigation dismissals against RPX members in suit).