In October 2000, as reported by Lori Enos in E-Commerce Times, Amazon.com founder Jeff Bezos and Tim O'Reilly backed a start-up called BountyQuest. The basic premise underlying the company was to offer "cash rewards to individuals who can prove or disprove a company's claim to a patent."
According to BountyQuest, corporations spend $4 billion per year investigating the validity of patents, frequently after being sued for violating a patent they believe does not represent true innovation.
How It Works
Companies looking for information to prove or disprove patent claims can post their requests anonymously on BountyQuest after registering and paying the $2,500 (US$) registration fee. BountyQuest also requires companies to place the bounty in escrow and to pay a commission if someone steps up with the required information and collects the bounty.The company said that it expects its clients to range from venture capital firms looking to assess the validity of companies they are considering for investment to lawyers whose clients are involved in patent infringement suits.
The Boston, Massachusetts-based company anticipates that its "Bounty Hunters" will include scientists, engineers, professional researchers and people with specialized knowledge. After registering, bounty hunters who are successful in tracking down "fugitive information" can submit a synopsis of what they have found to BountyQuest via an online form and then mail in supporting documentation.
Before collecting the bounty, individuals must provide information that meets all of the requirements set forth by the poster. Bounty hunters are not allowed to submit unpublished or secret information, including trade secrets and internal company memos.
Listed Bounties
In October 2000, [o]ver 50 bounties [were] listed at the site, with the number of rewards offered totaling $324,159. Among the bounties offered [were] a $40,000 reward for information on the SightSound Digital Download system, a method of downloading both video and audio files; a $20,000 bounty for information about Priceline's reverse auction search engine; and a $10,000 bounty for information about DoubleClick's Banner Ad Patent.
Today the domain is for sale and the last version of the site on WayBackMachine is from March 20, 2003. A testimonial from that version of the site reads:
No question about it, BountyQuest quickly turns up great prior art for defensive use in patent litigation. But what often is overlooked are the many other proactive uses of our human search engine approach--in product clearance, investment due diligence, and pre-licensing situations, and finding infringers.
A perfect example comes out of our recent $10,000 posting on a genetic sequence database patent held by Incyte Genomics. After learning that one of our Hunters had submitted winning prior art overlooked in the original patent application, Incyte's general counsel Lee Bendekgey wasn't singing the blues. Instead, he immediately recognized BountyQuest's potential as a tool for testing patent quality.
As Bendekgey was quoted in New Scientist Magazine: "We haven't started licensing that patent yet, so it is much better to know if there are problems with it now . . . It is fundamentally useful information."
Any thoughts on why this concept failed? Would this work today? Are you aware of a new BountyQuest in the marketplace? I am interested in your feedback.
From my interaction with it I think it failed b/c the right people didn't know about it - the real "users" that could make the bounty work didn't even know a) someone was looking for prior art, or b) the patent problem existed.
I used it for a litigation once where a 3rd party had prior art, but didn't want to spend the time to dig it up. We posted the bounty and called several of the engineers at the company directly to let them know it was posted. 2 weeks later we had our art, and they had the bounty.
Generally speaking I think if the techies had have know about the bounty all along at this 3rd party company, or any other company that had the same information, then the Bountyquest model would have worked better.
Great idea - BUT combined with the necessity to find specific prior art information AND those who happen to know where the information is, the business model suddenly gets weak.
Would it work today? I think that answer depends on the industry. Biotech; Electrical; Internet; Each industry is so IP specific with prior art [dates, data locations, availibity of art, etc.], that a specific business model would almost be needed for each one. Now THAT would be an interesting post to contemplate on a blog somewhere.
Posted by: Logical Philosopher | August 21, 2006 at 02:03 AM