1. Licensing Executives Society (U.S.A. and Canada), Inc. LES Standards Focus Group Meeting Pilot #3: Patent Licensing Entities Julie Mar-Spinola Finjan Holdings, Inc. Draft: 7/21/14

2. Pilot # 3: Patent Licensing Entities (PLE) 2July 22, 2014DRAFT: confidential Rationale: –System is not broken, needs changes based on behavior, not business model. –Promote credibility of licensing as an efficient transfer of rights in an effort to self-regulate and avoid government intervention

3. Pilot # 3: Patent Licensing Entities (PLE) Objectives and Focus: –To identify and isolate the real problems created by unethical or bad-faith licensing behavior. –To establish an industry-wide acceptable set of Licensing Best Practices that forms the minimal acceptable requirements for ethical licensing practices. –To generate a multi-lateral discussion among diverse participants with diverse and/or unique issues about responsible business practices re patents. May 24, 2015DRAFT - CONFIDENTIAL3

4. Pilot # 3: Patent Licensing Entities (PLE) Scope of the Committee’s Work –Agree name calling is not good –Agree patent system is not broken –Agree there ARE bad behaviors –Agree we can do better as a community of action –Behaviors may be the key, consensus? Benefits –Maximize efficiencies in licensing and litigation –Potential Judicial recognition of efforts to streamline disputes –Less oversight by legislators and reformists –Reputation increased May 24, 2015DRAFT - CONFIDENTIAL4

5. Pilot # 3: Patent Licensing Entities (PLE) Prioritization/Sequencing of Work –Build Consensus –Establish timelines July 22, 2014DRAFT - CONFIDENTIAL5

6. Pilot # 3: Patent Licensing Entities (PLE) Kinds of Companies Who Should Plan to Participate – Can’t we just be called Licensing Entities? That is, after all, what we are striving for… Deemphasize business model. –Hybrid entities: Operating Companies’ Licensing Arm –Operating Companies: any size, but evenly distributed; every sector (e.g., tech, bio, pharma, agi) –PLE’s: –Patent Aggregators: –Solo Inventors: producer/non-producer –Universities, R&D: May 24, 2015DRAFT - CONFIDENTIAL6

7. Pilot # 3: Patent Licensing Entities (PLE) Who benefits from creating “containers” for patent owners such as NPE’s, Trolls, PLE’s? –Are there rational (something more than superficial) benefits to creating the containers? –Undue prejudice against the patent office and not enough focus on behavior (the system is not broken) –Has oversimplification actually compounded the problem and the path to resolving the actual issues? May 24, 2015DRAFT - CONFIDENTIAL7

8. Pilot # 3: Patent Licensing Entities (PLE) Questions for Roundtable Discussions (cont.) –What are the top 3 disincentives for troll litigation? –How are patent litigations between “Operating Companies” different from litigation between a PLE and an Operating Company? –Are “Operating Companies” more willing to negotiate a license with an ethical PLE who conducts its business under acceptable licensing best practices? May 24, 2015DRAFT - CONFIDENTIAL8

9. Pilot #3: Patent Licensing Entities (PLE) Questions for Roundtable Discussions (cont.) –For ethical PLE’s, what is the biggest challenge in negotiating a patent license with an Operating Company or non-PLE? –Is practicing Licensing Best Practices sufficient to get over the “Patent Troll” presumption? –Should there be a “quid pro quo” by prospective licensees when negotiating with an ethical PLE? May 24, 2015DRAFT - CONFIDENTIAL9