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Chip Scale Review January • February • 2017


The benefits of cross-licensing for IC packaging

By Kevin Roe

[Intellectual Property Attorney]

and Phil Marcoux

[PPM Associates]

SMC is reported to be spending

over $1B on advanced IC

packaging development. Intel,

the third largest R&D investor,

plans to devote a sizable allocation of it’s

R&D dollars to advanced IC packaging

[1]. Likewise, Samsung is expected to

make a sizable IC packaging investment


Figure 1

). In addition to their internal

development, these companies do not rely

solely on in-house generated patents for

creation and protection of their products

and processes.

Creating and defending intellectual

property for anything, not just IC

packaging, have become very dicey,

e x p e n s i v e a n d c omp l e x b u s i n e s s

requirements. Until the late 1990s,

much of the semiconductor segment

of the electronics industry sought to

share intellectual property using what

are called “cross licensing” agreements

t o he l p advanc e bo t h t he s uc c e s s

of the corporation and the industry.

This strategy wasn’t implemented

because of the benevolence of the

industry leaders, but more often out

of the realization that key technology

d e v e l o pme n t s we r e e x p e n s i v e t o

discover, develop and protect.

Starting in the mid-1990s a number

of parties and companies discovered

that they could gain more commercial

value by independently licensing their

IP rather than enter into cross license

a g r e eme n t s . I n s ome c a s e s , t h e i r

licensing tactics

resulted in several

v e r y e x p e n s i v e

a n d b i t t e r

l i t i g a t i o n s . B y

mid-2000, several

large companies

banded t oge t he r

t o s e ek change s

t o t h e p a t e n t

system to reduce

t h e i r e x p o s u r e

t o l i t i g a t i o n .

I n r e s p o n s e

r ev i s i on s t o t he

U.S. patent system were made via the

America Invents Act that was signed

into law in 2011 [4]. These resulting

revisions to patent ownership, put into

practice by the U.S. federal courts and

the U.S. Patent Office, were seen by

many as protection against meritless

patent harassment (Non-Practicing

Entities, i.e., parties that don’t actually

use the patents they seek to enforce).

However, one unfortunate consequence

of this legislation actually supported

and resulted in the demonization of

individual inventors and their patents

in the U.S. One of the most onerous

and less understood revisions is the

expanded rights of accused infringers

and third parties to file re-examination

requests against any patent and to wage

ongoing appeals. This anti-inventor

legal bias will have extremely negative

consequences for the U.S.

Many companies are continuing to

look for ways to reduce their legal costs

and exposure even further. As a result

of the changes in patent treatment,

cross-licensing agreements are now

returning as an attractive and viable

way to indirectly monetize corporate

patents. For example, even in the IC

packaging business arena, companies

known as outsourced semiconductor

assembly and test suppliers (OSATS)



Figure 1:

Ranking of the top 20 R&D investing companies in 2015 [2].