Patent pool

In patent law, a patent pool is a consortium of at least two companies agreeing to cross-license patents relating to a particular technology. The creation of a patent pool can save patentees and licensees time and money, and, in case of blocking patents, it may also be the only reasonable method for making the invention available to the public.Competition law issues are usually important when a large consortium is formed.

History

One of the first patent pools, Sewing Machine Combination, was formed in 1856, by sewing machine manufacturers Grover, Baker, Singer, and Wheeler & Wilson, all accusing the others of patent infringement. They met in Albany, New York to pursue their suits. Orlando B. Potter, a lawyer and president of the Grover and Baker Company, proposed that, rather than sue their profits out of existence, they pool their patents (See also: Isaac Singer/I. M. Singer & Co).

In 1917, the two major patent holders for airplanes, the Wright Company and the Curtiss Company, had effectively blocked the building of new airplanes, which were desperately needed as the United States was entering World War I. The U.S. government, as a result of a recommendation of a committee formed by Franklin D. Roosevelt, then Assistant Secretary of the Navy, pressured the industry to form a patent pool, the Manufacturer's Aircraft Association.