Is Intellectual Ventures behind Apple iOS in-app purchase lawsuit threats? We think so.

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On Friday, several developers of Apple iOS apps received notice that they were violating US patent 7,222,078.  These letters came from a patent licensing company based in Marshall, Texas called Lodsys.  Most likely, you’ve never heard of Lodsys.  But perhaps you’ve heard of Intellectual Ventures (IV), a patent licensing firm founded by former Microsoft employees Nathan Myhrvold and Edward Jung.  Since 2000, IV has spent nearly a billion dollars to acquire over 30,000 patents.  The company then uses these patents and the threat of lawsuits to pressure companies into purchasing patent licenses.

So what is the connection between Lodsys and IV?

Lets first start at the website of Dan Abelow, the inventor of US patent 7,222,078.  As you can see above, Abelow sold his patent portfolio to patent licensing companies Webvention and Lodsys.  What’s interesting about Webvention and Lodsys is that both companies have the same address.  You can see Webvention’s address on their website here, and a look at Lodsys’ domain registration information shows the same address, 505 East Travis Street in Marshall, Texas 56574 (below).  This info leads us to believe that Webvention and Lodsys are in fact one and the same.  You’ll also notice that the phone number for Lodsys is just the local 411 number for Marshall, Texas.

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The connection between Webvention and Lodsys is important, because Webvention has a long history of working with IV.  Here, here and here are a few examples of Webvention either purchasing or licensing patents owned by IV.

That leaves another question…is Webvention simply a third party purchasing patents from IV, or is Webvention actually a shell for IV itself?  Take a look at the following information and make the decision for yourself.

First, a look at the Texas Comptroller’s office shows that Webvention LLC’s address is 227 Bellevue Way NE Ste 521 in Bellevue, Washington (first, below).  That seems odd, right?  A Texas based company with an address in Bellevue, Washington?

That is until we take a look at the Inventor’s Phone Book, a guide published in 2008 that promises “secrets to getting the highest paid royalty for your invention.”  Intellectual Ventures is listed on page 222 of the Inventor’s Phone Book, and guess what their address is…that’s right, 227 Bellevue Way, Bellevue, WA, 98004-5721 (second below).  If you look up 227 Bellevue Way, you find a UPS Store – we’re guessing that IV simply rents out a PO box from this store for its Webvention shell.

In our opinion, this evidence leaves little doubt that Lodsys, Webvention and Intellectual Ventures are indeed the same company.  Nilay Patel, former editor of Engadget also made this connection through the assignee of patent 7,222,078, Ferrara Ethereal LLC.  According to Patel, Ferrara Ethereal LLC is a shell for IV, just like Lodsys and Webvention.

So why is IV targeting small iOS app developers?  Well, to get Apple to purchase a multi-million dollar license, of course.  More on that later.image

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