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Court Approves Google's Bid For Nortel's IP 130

Posted by Soulskill
from the go-hog-wild dept.
Meshach writes "A court had approved Google's bid to take ownership of Nortel's arsenal of $900 million worth of patents and patent applications. Other bidders will have until June 13 to submit competing offers. Unfortunately, neither shareholders of Nortel nor the company's employees waiting for a pension will see any of that money."
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Court Approves Google's Bid For Nortel's IP

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  • Can we really trust them not to "be evil" here? I'm personally suspicious of any company trying to stockpile patents...

    • by mr1911 (1942298) on Monday May 02, 2011 @04:52PM (#36004302)
      If Google did not have a large patent portfolio they would likely be sued out of existence very quickly. Patent portfolios are a necessity.
    • by Reapman (740286) on Monday May 02, 2011 @05:05PM (#36004440)

      If I've learned anything about mobile hardware, it's that it's a mine field of litigation and patents. Often the biggest complaint I hear about Android and Google is that they don't have enough patents to fight off the big guys of the mobile world - likely this is to resolve that situation.

      Compared to the alternatives I still would trust them more then the others. I guess I'm from the generation that still remembers Google as the ones that, in a way, saved the Internet from itself. Without a good reliable search engine the Internet is pretty useless - Google fixed that by not allowing better rankings by paying more $$$. They proved you don't have to pull crap like that to make money. With that said Google is a company - no company should be 100% trusted, but so far I haven't been burned by them.

      The biggest complaint I've heard is that Google sells my information. Well, let's see.. I use Google.com, and I use an Android phone. So far nobodys broken my legs. I haven't received excessive spam (Well, maybe, but GMail does a good job of blocking them if I have), nobody calls my phone asking to sell me stuff. So far all I've seen are... local ad's when searching. I am ok with that.

    • by DaMattster (977781) on Monday May 02, 2011 @05:10PM (#36004492)
      IMHO, this is a good thing for open source. Google has proved its intentions are good with the webm project and google talk.
    • Google can prove they are not evil by using these patents to immediately sue Microsoft and Oracle.
      (Samsung already has Apple covered.)
    • by LWATCDR (28044)

      Depends. One of the things with these patents is that Microsoft cross licensed them. The rest is just what I have heard so take it with a grain of salt. They did a cross licenses deal in perpetuity. with Nortel. If that is true and it transfers to Google then Microsofts attacks on Android based on patents could come to a screeching halt.
      So is that good? Well for a lot of Android users it is and for companies that are using android it is. For Microsoft and it's share holders it is evil. For Google shareholde

      • by PhilHibbs (4537)

        I don't think MS are suing Google, they are suing Android handset manufacturers.

        • by LWATCDR (28044)

          Over Android. They say it infringes. After this purchase that may not be the case any longer.

          Isn't it a sign of a broken system when a company can sue the customers for buying a product that infringes without suing the company that makes the product?

          • by PhilHibbs (4537)

            Do the handset manufacturers buy Android? Isn't it free to use, other than the trademark which has some requirements to qualify for?

    • by Greyfox (87712)
      I'd expect them to announce lawsuits against Apple and Microsoft as soon as they can absorb information on everything contained in the portfolio (Which they've probably already done.) This will be followed by a period during which they resolve what things they have duplicate patents on and decide who loses if they start an all out legal war over the patents. If the answer is pretty close to "Everyone," they settle out of court and we never hear about it again. Pretty standard stuff, really.
  • by RichMan (8097) on Monday May 02, 2011 @04:50PM (#36004272)

    $900M is less than what the last 3 CEO's of Nortel walked out the door with in salaries and benefits. We really really need a corporate revolution where executives are not rewarded in ridiculous amounts.

    John Roth pocketed $100M in 2000.
    http://www.cbc.ca/news/business/story/2001/03/14/nortel010314.html

    If CEO's get options they should be at only a slight discount on the current stock price and not execisable for 20 years. Long term value is what is needed. Not short term decisions which strip assets and long term strength in trade for short term magic accounting numbers.

    • I think the system is working here. Companies that make smart decisions survive. Companies like Nortel that pay zillions of dollars to people running the company into the ground do not survive.

      • Corollary - investors who put faith in good companies are rewarded. investors who do not are not.

        • by Ash Vince (602485) *

          Corollary - investors who put faith in good companies are rewarded. investors who do not are not.

          The problem is that many of these investors did not have much choice, they were simply working for Nortel and their pension was in company stock. If I work for a company and get a company pension I have very little choice how that is invested on my behalf. Some of these people losing out have probably worked 20 or 30 years thinking their retirement was covered and have just discovered they are redundant and also looking forward to a pennyless old age.

          Actually not quite pennyless, but capped at £28,000

          • The problem is that many of these investors did not have much choice, they were simply working for Nortel and their pension was in company stock.

            Does anybody else think this is a very bad idea? Investments should always be diverse, and if you are going to invest everything in one company the company you work for seems a particularly bad choice.

            What were the trustees thinking? (There were trustees, I hope? The US isn't daft enough to let companies manage their employee's pension schemes themselves?)

      • I think the parent poster was commenting that the CEO's shouldn't profit if the company doesn't.
        • Perhaps the company should structure the contract that way?

          • by SETIGuy (33768)
            When the compensation committee, hired by a board stacked with cronies, is stacked with cronies? I think you underestimate the power of the dark side. I think you also overestimate the power of the shareholders.
            • by JAlexoi (1085785)
              Well when the largest shareholders occupy the board and own 50% +1 share, there is no way they are going to listen to the others. In fact, people tie up the value of the company to the share price on the exchange that they feel that a dropping price is the same as wealth reduction.
              • by billcopc (196330)

                Meh. All money is funny money anyway. If you believe otherwise, you need to read up on fractional reserve banking.

                Stocks, dollar bills, government bonds... none of these hold any intrinsic value, and thus all of them can become worthless with a stroke of the pen.

      • by rmstar (114746) on Monday May 02, 2011 @05:02PM (#36004422)

        I think the system is working here. Companies that make smart decisions survive. Companies like Nortel that pay zillions of dollars to people running the company into the ground do not survive.

        Is that sarcasm? You surely have not missed that those running the company to the ground and those that decided their pay were the same people? It is the common worker at such a company that suffers the consequences of the bad decisions taken by the good folks with the golden parachutes. The system is not working at all!

        • by h4rr4r (612664)

          The system is working exactly as it should. You are mistaken in what way the system is designed to work.

          The people profiting are the ones in control of the system and implementing it. If you think this was not their intention you are very naive.

          • by memnock (466995)

            It's too bad the employee get screwed along the way. I don't feel as bad for shareholders, but I do have some sympathy for them. The investors akin to speculators. I know some of those investors are people in a mutual fund who don't know a stock from a bond, but they're there because some other knownothing told them to buy a mutual fund share. Plus, they can't read the minds of the megalomaniacs who are the execs that are running the company into the ground and still walking away rich as if they had BUILT a

            • by memnock (466995)

              Dang. Meant to say:
              They DON'T get a dime for their efforts.

            • by Dan541 (1032000)

              Even better for the employee is that they are going to be working for the same CEOs again at another company.

            • by PhilHibbs (4537)

              The employees OTOH have put a lot more equity into the company than an investor.

              Well that was a pretty dumb thing to do.

          • by bmo (77928)

            This is why that every CEO that deliberately drives a company into the ground should be tied up and shot by the workers. Because he deserves it. Golden parachutes are worthless if you can't spend it. Maybe that will put some incentive into running a company correctly. Because as it is, there is no incentive.

            Seriously.

            --
            BMO

          • by JAlexoi (1085785)
            It's called capitalism. If you pray to it, then live with it.
        • What does the "common" worker bring, outside of common skills that millions of others can bring?

          If the best you can do is press a button over and over, you shouldn't feel too down about not really getting the big bucks. I know, I know... on populist Slashdot, we're all for the workers revolution. It's never worked before, but hope springs eternal in the mind of the middle class.

      • by gtall (79522)

        yes, dumb companies do not survive, but on the way out, they destroy the economic lives of many fine upstanding workers. In this sense, the system is not working at all for them.

    • by mcmonkey (96054)

      If CEO's get options they should be at only a slight discount on the current stock price and not execisable for 20 years. Long term value is what is needed. Not short term decisions which strip assets and long term strength in trade for short term magic accounting numbers.

      The very idea of giving stock options to high level executives is antithetical to the purpose of retaining quality executives who will make good decisions for the benefit of the company.

      Options given in addition to other forms of compensation are basically bribes, and as such necessarily pointless. The person who will provide an honest day's work for an honest day's pay will not be persuaded to be any more 'honest' as a consequence. The person who insists on extra benefit above salary will always want mor

      • The very idea of giving stock options to high level executives is antithetical to the purpose of retaining quality executives who will make good decisions for the benefit of the company.

        Huh? If you're an exec with 100K options in Company X it's in your interest to make good decisions which in turn drive up the share value. If an exec makes bad decisions that drive down share value, it hurts *them* in the wallet. This is exactly what you want to see...

        • by msauve (701917) on Monday May 02, 2011 @05:40PM (#36004744)

          Huh? If you're an exec with 100K options in Company X it's in your interest to make good decisions which in turn drive up the share value.

          If, by "good decisions," you mean illegally cooking the books to show greater profits than actually exist. That's exactly what happened at Nortel, and it was driven by executive compensation incentives. Of course, the ultimate result of those "good decisions" was the failure of the company.

        • by SETIGuy (33768)
          Except that if the stock goes down, they'll backdate the options far enough back that they're in the black. "Backdating options" sound so much more pleasant than "stealing from the shareholders."
        • by JAlexoi (1085785)
          And the execs make "good decisions" that benefit stock traders that speculate on stocks and benefit their income when they sell the stock. Investors, I mean proper investors that care about actual profits and company value, are in for the long haul. CEO will cash out ASAP. He has no interest in driving up income, he has interest in driving up profit expectations and profit margins. These drive up the price of their stock, so that they can sell it back to the long term investors. At that time long term inves
        • by Anonymous Coward

          Don't get me started on Nortel... oh, too late...

          Not when the CEO/CFO inflate the numbers to drive up the price, so that they can exercise their options before the truth came out and the price sinks. The last jackass^H^H^H^H^H^H^H CEO that Nortel had, "negotiated" a pension that if he worked there for 5 years would guarantee him a retirement salary of $500,000, and if he should die first, his wife would get $350,000. This was on top of the $27 million they had to pay him, so that he could pay his Motorola

        • Your mistaken, it is only in the person's interest to drive up the stock in the short term as high as possible to cash in, if it screws the company, oh well, he got his money.

      • by Obfuscant (592200)

        The cult of the stock option is a cargo cult. The lavish compensation package doesn't create a good CEO any more than building a runway will create planes.

        Oooh, an aviation analogy instead of automotive. Very nice.

        Lavish compensation will not create a good CEO. Very true. It will, however, reward (when that compensation is in options) one that works to keep the stock prices high. Just as you don't create planes by building a runway. If you build a very large and expensive runway, however, you will attract large and expensive airplanes, the owners of which are more likely to spend a lot of money at your airport.

        A 1700 foot grass strip is good for Cessna 150-

        • A good option (for the employees and regular investors) would allow the CEO to buy that $1/share option only if the share price is over $2/share, and only if it has been over $2/share for the last twelve successive quarters (or over $3/share for the last ten, or over $4/share for the last eight).

          Any CEO in the job for the good of the company should readily agree to that.

          • by Imrik (148191)

            How about if the CEO can exercise it whenever he wants but he can't sell the stock for 10 years after he buys it.

            • I think that makes them, as "options", worthless. The CEO has to invest his own money to buy the stock (rather than have the money fronted by his broker as is done in a single-day sale), and then hold it for what could be the length of typical employment. It would make more sense for him to execute immediately if he wanted to stick with the company for ten years, which is no different than him simply buying the same number of shares on the open market (assuming he wasn't getting some sort of look-back dea

        • by JAlexoi (1085785)
          Ah... You're an idealist. Let's see how much money and how worthless executive compensation was for Lehman Brother's CEO? Yep, he netted over half a billion over 14years. Granted, it's OK. Over 14 years he actually earned between 50-100 million, the rest were stocks. So why wasn't that wealth wiped out when he ran the company into a bankruptcy? That is why the system is broken.
        • by mcmonkey (96054)

          I understand how stock options work.

          And no, I don't believe just building a runway, no matter how long, will attract jumbo jets, unless there is some other attraction in the area and the jet and runway are just means to that end.

          Perhaps a better analogy are the recent studies in paying students for performance.
          http://www.time.com/time/nation/article/0,8599,1978589,00.html [time.com]

          The result of paying students for good grades? Basically, it doesn't work. Why? Because if you don't know what you need to do to get go

    • by yuhong (1378501)

      Long term value is what is needed. Not short term decisions which strip assets and long term strength in trade for short term magic accounting numbers.

      Yea, I have considered stock price based compensation fundamentally flawed for a while now.

    • Remuneration for Company Officers
      I can hear the squeals from here...

      Right now corporate executives of large companies are paid very large salaries with even larger bonuses, bonuses that they seem to get even as they waddle up to the trough for a government bailout.

      There is no incentive to think beyond the next quarter, or at most, next bonus period. I watched an interview on one of the news documentary shows where an official admitted he knew the bubble would burst, but was going to make money as long as he

    • Why? Seriously, why? The shareholders vote the board, the board votes the salary. Who's hurt here? We're not even talking banks here, but every corporation down to little mom-pop run ones where the shareholders are family. Who cares what the CEO makes? You wanna pay less, buy stock, and vote to pay less.

      But, you say, rich shareholders put in rich friends, and everyone votes everyone else up. Well... yeah. Cause they OWN the company. If I own a company, I'll pay myself whatever I please, tyvm.

      • by SiChemist (575005)

        The rich shareholders don't "own" the company. They control the company. There are many other investors whose interests are ignored.

  • by Anonymous Coward

    It does not exist to provide you with a steady flow of warm fresh milk poured into your mouth. It is thousands of other men and women looking to take money out of your pocket and put it into their own.

    - Alexander Elder.

    If you don't like those terms, then don't play the mother-fucking stock market. Get a life and go put your money elsewhere. If you're a Nortel pensioner, or some stupid ass pension fund who bought Nortel stock, then you ought to be smart enough to know that bondholders get paid out from [w

    • by mingot (665080)
      I like the cut of your jib.
    • by bmo (77928)

      Some day you will become old.

      --
      BMO

    • by pavon (30274)

      And beyond that, the majority shareholders of Nortel allowed the executives to take out loans from creditors, presumably because they thought it might save the company. The board could have just as easily prevented the company from going into debt, and instead liquidated it while it was still in the black so the shareholders would get something. But they didn't, and it is only fair now that the creditors get paid before them.

      Pensions on the other hand ...

  • Great. This comes out on election day... when the once bright star of Canadian high-tech companies is sold in pieces to various non-Canadian interests.

    (trying to be as non-political about it...)

  • Unfortunately, that's why we call it "bankruptcy."

  • Can we stop using the term "Intellectual Property" to refer broadly to trademarks, copyrights, and patents, which all operate under different rules and have different motivations? By lumping them all together you are muddling the important issues and giving unfair advantage to potentially undesirable ideas. It's quite simple: "Court Approves Google's Big for Nortel's Patents"

    Was that so hard?
    • By lumping them together in discussions where the details don't matter, you avoid worrying about details that don't matter. I know the holy book of RMS says you have to fight this wherever you found it, but that war is lost. The world isn't getting rid of intellectual property anytime soon, no matter how amazingly utopian you're sure it will be.

  • A frequent comment here on Slashdot is that patents should not be transferable or that a company should not be allowed to own a patent covering technology that it did not invent or that a company shouldn't be able to own a patent covering technology that it doesn't intend to use. Here, Google is doing all of these things, since no doubt at least some of the patents cover technologies that Google will never put into practice.

    Many licensing-focused non-practicing entities got their patents from bankruptcy sa

    • by mr1911 (1942298)

      company should not be allowed to own a patent covering technology that it did not invent

      Companies do not invent anything. Employees at companies invent things. The employees assign the patent to the companies. If you remove the ability to assign a patent, invention stops. OK, not all invention, but the invention that people are paid to do, which is probably not much more than 99% of all invention.

      • by Grond (15515)

        Companies do not invent anything. Employees at companies invent things. The employees assign the patent to the companies.

        I'm aware of this, but the distinction was not particularly important in this case. Furthermore, most of the world outside the US does not take that approach. In Europe, for example, the company is the applicant, not the inventing employee.

        • by iiiears (987462)

          Do you think paid legislators wouldn't enact a law to unlock the value of patents from escaping wealthy interests?

  • If Google were really to stick to its motto and would like access to the brightest minds here they would pickup those pour souls lost at Nortel. The rich tank the company and buy it back for nothing later, muuuch cheaper to operate that way...my old man taught me the ways as he's been around and seen it as well as been told by his ancestors the same story of how this trick works.
  • Aren't the products and services they took over for naught without the patents behind them? I don't quite understand how this works.

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