Tech giants aim to cut patent trolls off at the pass

Verizon, Google, Cisco, Ericsson and HP are joining a group designed to buy up intellectual property before other parties acquire it to launch lawsuits.

The Wall Street Journal is reporting this group of tech giants--dubbed Allied Security Trust--is designed to thwart patent trolls and prevent stand-offs like the Research in Motion-NTP lawsuit, which was settled in 2006 for $612.5 million. The patent lawsuits are flying between long-time rivals, firms that are only designed to sue and any other party that thinks it has a claim.

The Allied Security Trust effort is just the latest way companies are trying to protect themselves. The Journal reports that companies will pay $250,000 to joint Allied Security Trust and then put in $5 million in escrow to fund future patent purchases. The trust will then grant its owners nonexclusive licenses to the underlying technology and sell the patents.

This plan sounds like it could actually work, but patent reform may be a better avenue in the long run. I'm mixed on the idea. On the one hand, Allied Security Trust could thwart patent trolls. And patent creators could have another avenue to monetize their intellectual property. However, the risk is that a select number of technology giants will control intellectual property--albeit indirectly.

Thoughts?