Intuit Pays $120 Million 'Don't Sue Us' Tax To Intellectual Ventures

from the money-wasted dept

It's no secret that I have tremendous problems with Nathan Myhrvold's Intellectual Ventures, which many have described as the world's biggest patent "trolling" operation. The company has raised a ton of money and uses it to buy up thousands of patents. While it hasn't sued anyone, Myhrvold has made clear that's always an option. The company has remained incredibly secret, but it has somehow convinced some big companies to pay hundreds of millions to IV. Due to the secrecy, the details aren't clear -- and some of the deals apparently are a mix of "licensing" and an equity investment. But, still, the numbers are stunning. The latest, as pointed out by Stephen Kinsella is that Intuit has apparently paid $120 million to IV. For what? The right not to get sued. Think about that for a second. This is a pure dead weight net loss to society. It's $120 million that Intuit could have put towards further innovating, or to pay off investors via a dividend. Instead, it goes towards nothing productive, in terms of actually creating new products. It will now likely be used to buy up more patents so that IV can get similar black hole money grabs from other companies, as well. It's like a black hole where real innovation goes to die.

Filed Under: patents, software
Companies: intellectual ventures, intuit


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  1. identicon
    Anonymous Coward, 1 Jul 2009 @ 11:20pm

    Re: dead weight?

    "The ability to profit on the R&D required to achieve an invention that can be easily copied is something that needs to be protected or else kill that kind of innovation."

    The patent killed the invention. It stopped the advancement of the invention. Most entities do not waste money buying a license to use a patent, they spend tons of resources trying to AVOID infringing on patents. They try to avoid patented ideas that they would naturally come up independently, without patents. That STOPS innovation, it prevents the advancement of good ideas.

    Here we have a patent troll that prevents other entities from advancing ideas that they independently come up with because those ideas happen to be patented. The entity itself does not advance the ideas (and the inventor itself can no longer advance it) so the ideas DIE in favor of less efficient, more costly ideas. Society is better off allowing anyone to independently come up with and advance these ideas without patents.

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