Sony Wins Bid for Ipix Camera Technology Patents

She moved the headquarters to Reston and landed some crucial contracts, including one for $2.4 million from the Defense Advanced Research Projects Agency to develop the world's highest-resolution video camera. After the 2005 bombings in London, Conti aggressively promoted the technology as a homeland security tool.

But the company was burning millions of dollars every quarter, even as it sold stock and raised private funds to fill the revenue gap. Industry analysts warned that, although Ipix's 360-degree video technology had security applications, there weren't enough buyers.

"It's a very tough market to break into," said Frost & Sullivan research analyst Dilip Sarangan. Local governments are increasingly buying surveillance technology, "but it hasn't really been tried and tested, so a lot of private companies aren't willing to spend money on it."

In June, Ipix raised $5 million in private financing in a last-ditch effort to buoy its accounts. But a month later, four top managers resigned. Conti announced her plans to liquidate all assets, a strategy she said was the best way to pay back the creditors.

Without a company to run, she worked as a consultant, earning $5,700 a week to assist Donald King, the bankruptcy-court-appointed trustee for the case.

The $3.6 million selling price, while higher than expected, still won't pay off the company's debts, which total $7.8 million. Ipix reported a cumulative deficit of $544 million at the end of March.

King, an attorney with the law firm Odin, Feldman and Pittleman in Fairfax, said he remains puzzled as to why the company threw in the towel.

"They had a significant amount of cash and what we now know to be valuable patents," he said.

Jim Phillips, former Ipix chief executive who oversaw its initial public offering, said he was "shocked and astonished" to hear of the bankruptcy. Now running a biometrics and medical imaging firm, Luminetx, in Memphis, he bid $3.5 million on the patents before he forfeited to the then-unknown bidder. Phillips purchased Ipix's furniture and computers for his new offices.

"Somebody completely ran that company off the tracks," he said. "There was so much promise on the security side. Sony got the bargain of the century."

Stuart Claggett, who was executive vice president of Ipix until it filed for bankruptcy, said Sony's interest in the patents makes sense, given the company's recent push into high-resolution cameras and video-surveillance products.

Claggett and Geoffrey Egnal, former Ipix chief technology officer, formed their own aerial digital imaging company, Springfield-based Argusight, shortly after Ipix shut down. They placed a $100,000 bid for Ipix's 50 percent ownership interest in technology jointly owned by the University of Alabama, but lost to Sony.

"We were very surprised" to learn Sony was the winning bidder, Claggett said, agreeing that the patents were a steal. "Patents in this business were worth at least that, if not more."