By Nick Brown
NEW YORK, Jan 11 (Reuters) - Eastman Kodak Co's proposed
$525 million sale of its digital imaging patents to Intellectual
Ventures and RPX Corp got a bankruptcy judge's approval
on Friday, bringing the photography innovator a step closer to
exiting Chapter 11.
The price is a fraction of the more than $2 billion which
Kodak had hoped to fetch for the patents when it filed for
bankruptcy in January 2012. However, it allows the company to
proceed with a plan to secure $830 million in financing and exit
bankruptcy in the first half of this year.
Judge Allan Gropper gave his green light at a hearing in
U.S. Bankruptcy Court in Manhattan.
"We're disappointed in the price, but we're moving the case
forward," Gropper said.
Intellectual Ventures and RPX lead a consortium of some of
the world's biggest technology companies, including Adobe
Systems Inc, Amazon.com Inc, Apple Inc
and Fujifilm Holdings Corp.
The deal, announced in December, allows for the licensing of
patents, settlement of patent-related legal claims, and the
assumption of a cross-licensing agreement between Kodak and
Fuji. Kodak said it was pleased with the court's approval.
"The monetization of non-core IP assets achieves one of
Kodak's key restructuring objectives while positioning its
commercial imaging business for further growth and success," the
company said in a statement.
Kodak's patents hit the market as intellectual property
values soared and technology companies began plowing money into
patent-related litigation.
For example, Nortel Networks Corp in 2011 sold
6,000 wireless patents in a bankruptcy auction for $4.5 billion,
and Google Inc spent $12.5 billion last year for
patent-rich Motorola Mobility.
But Kodak's patent auction dragged on beyond the initial
expectation that it would be wrapped up in August and never
generated nearly as high a price.
Kodak, which traces its roots to the 19th century, invented
the handheld camera but was unable to shift successfully into
digital imaging. It will likely be a different company when it
exits bankruptcy, leaving the consumer business and focusing
instead on providing products and services to the commercial
imaging market.
The Kodak bankruptcy case is In Re: Eastman Kodak Co. et al,
U.S. Bankruptcy Court, Southern District of New York, No.
12-10202.
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