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Patent company joins Siri dust-up

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TROY, N.Y. » Some big-money backers have joined Rensselaer Polytechnic Institute in its legal fight over the Siri voice-recognition system used in Apple’s iPhone.

RPI asserts in a federal lawsuit that more than a decade ago, one of its professors actually invented the technology used in Siri, made popular by funny commercials featuring Martin Scorsese, Samuel L. Jackson and John Malkovich.

RPI had also been joined in the lawsuit by a Dallas-based company known as Dynamic Advances that had bought the executive license for the technology from RPI several years ago.

Dynamic Advances was controlled through a family foundation by Erich Spangenberg and his wife, Audrey. He is a well-known patent litigator who also runs the patent monetization firm IPNav, also based in Dallas.

Although Spangenberg is one of the most high-profile patent lawyers in the country — he is sometimes called a "patent troll" by his critics — he recently sold Dynamic Advances, including the RPI license, to an Alexandria, Va., public company called Marathon Patent Group.

Spangenberg called the patent licenses he sold off "important assets with potential significant value," in a statement, although it’s unclear how much the suit could command if successful.

”While we cannot comment specifically on current litigation matters, we expect to continue our relationship as Dynamic Advances transitions to Marathon Patent Group," RPI spokesman Michael Mullaney said.

It appears that RPI and Marathon believe they stand to make tens of millions of dollars. The transaction included $11 million in cash, as well as about $4 million in stock — and includes potentially lucrative payouts in the future if the lawsuit against Apple is successful.

In conjunction with the acquisition, Marathon raised $6.5 million in a stock sale, giving it even more firepower in its legal fight against Apple.

”We anticipate the patent assets we acquired will contribute meaningfully to Marathon’s revenues and earnings and we have improved our balance sheet considerably with the closing of the financing," Marathon CEO Doug Croxall said in a statement.

The deal also shows how patent litigation, once pushed by shadowy law firms that tried to threaten companies with litigation as a way to monetize intellectual property, is being pushed into the realm of Wall Street and venture capital.

Spangenberg and his firm IPNav will still work with Marathon on the case as an adviser.

”The market is constantly changing, and we are confident we are working with a company that will be successful," Spangenberg said.

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