Intellectual Property Exchange International, Inc.

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Intellectual Property Exchange International
Ipxi logo.gif
Founded 2007
Headquarters Chicago
Key People Gerard Pannekoek, CEO
James E. Malackowski, Co-Chairman
Products Unit License Right (ULR) contracts
Website www.ipxi.com

The Chicago-based Intellectual Property Exchange (IPXI) is the world’s first financial exchange for licensing and trading intellectual property.[1] The exchange facilitates non-exclusive licensing and trading of IP rights using market-based pricing and standardized terms.

The IPXI marketplace is designed to allow owners of IP to monetize their IP assets more efficiently and give them access to risk management tools to hedge their exposure.[2] IPXI identifies, evaluates and executes IP licensing transactions through its Unit License Right (ULR) model. Through a proprietary electronic trading platform, members can purchase and trade IP rights in the form of ULRs. IPXI’s membership includes some of the world’s leading innovative companies with significant IP assets representing a variety of technology markets, top university research institutions and national laboratories.

IPXI was created by Ocean Tomo LLC.

As of February 2013, IPXI has 46 members. Among these members are IPXI’s 20 Founding Members, including Ford Global Technologies, LLC; J.P. Morgan Chase & Co.; Philips Intellectual Properties & Standards; Sony Corporation of America, and Hewlett-Packard Company. These founding members have committed to sponsor offerings on the exchange with an aggregate target market value of more than $750 million.[3]

IPXI Products

Unit License Right (ULR) Contract

Through the ULR contract model, IPXI intends to meet its objective of operating an exchange under two core principles that do not exist in traditional bi-lateral licensing: transparency and efficiency. The process starts with legal analysis designed to give the marketplace confidence in the quality of all patent rights listed as ULR contracts. Then IPXI undertakes the licensing process in a manner similar to a public equity offering for a corporation by utilizing detailed offering memorandums, road shows and potential buyer one-on-one meetings.

Once an initial offering has been priced, IPXI manages the primary issuance of ULR contracts. IP also maintains a secondary market which provides ULR contract purchasers and sellers an opportunity to realize liquidity through resale and trading. The secondary market also increases the primary market demand for ULR contracts as they become investment products, thereby maximizing revenues to the ULR contract sponsor. As demand requires, IPXI will issue follow-on primary market offerings of ULR contracts.

Finally, a rules-based approach to directed enforcement allows ULR contract sponsors to passively enforce IP rights with different choices to fund litigation, including either self-funded enforcement, IP insurance or third-party funded enforcement.

History

IPXI was founded by Ocean Tomo. The development of the exchange began with support from the State of Illinois in 2006. Two public town-hall meetings with several hundred corporate IP owners, inventors and other market participants were held. Fourteen national and international corporate and university IP managers attended the initial Rulebook meeting in March 2010. Beyond these formalized meetings, hundreds of IP ecosystem participants have contributed to the development of the exchange and the initial product, the ULR contract.

Key People

References

  1. IPXI: Trading Patents in 2012. CNBC.
  2. IPXI. IPX International.
  3. CBOE backs new intellectual property bourse. Financial Times.