Elpida foreign representatives seek OK for patent sale and lease back

By Jim Witters

Wilmington, Del., Sept. 28 - Elpida Memory, Inc.'s foreign representatives are seeking U.S. approval to sell and then lease back the rights to certain patents, according to a Sept. 28 filing with the U.S. Bankruptcy Court for the District of Delaware.

The patent purchase agreement with Rambus Inc. emerged from negotiations to amend a memory products licensing agreement in place between the companies since 2010.

Because the information may be valuable to competitors of the two companies, the purchase price for the proposed patent sale was redacted from all public documents.

"Because of the business relationship between Rambus and Elpida, and the ongoing negotiations regarding the amendment to the license agreement, Elpida believed that Rambus was a logical purchaser of these patents and would be willing to provide more consideration for the patents than any other purchaser," the Elpida motion states.

Some of the patents are registered in the United States.

"The consideration as provided in the patent purchase agreement is for the entire portfolio of patents being sold. It is not possible to separate or carve-out the value of the United States registered patents," the motion states.

Elpida intends to use the proceeds to pay its administrative claim obligations.

Under the agreement, Rambus will grant a royalty-free, perpetual license to Elpida for these patents, protecting Elpida's estate from patent infringement suits and permitting Elpida continued use of the technology.

The patent purchase agreement was approved Aug. 10 by the Tokyo District Court, Eighth Civil Division, where Elpida filed for corporate reorganization under the Japan Corporate Reorganization Act.

A U.S. hearing is scheduled for 2 p.m. ET on Oct. 24.

Elpida, a Tokyo-based manufacturer of DRAM integrated circuits, filed for bankruptcy on March 19, 2012 to gain recognition of its Japanese proceedings. Its Chapter 15 case number is 12-10947.

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