It is also highly possible that DTV tried to lowball VRNG we have no clue.
While it was not the outcome we wanted, we all KNOW (at least those of us in patent stocks) that is is common.
What I think you may be missing is CLEARLY, this tells the market and us all that the DTV numbers are MATERIAL TO BOTH PARTIES. How can I deduce this?
1. Well VRNG24 had provided some research in the past that, while interesting, and certainly suggestive of material values, couldn't be vetted as none of us knew how much of the sizable revenues he mentioned were directly attributed to these patents. It is very much the reason I stated we should be focusing our attention on the comments by Cohen in the PR about the ZTE patents, as we know those are material to VRNG.
2. However, given this development, I think it is safe to assume no that the numbers are material because:
A. If it was a $3-5 mil asking price, it would not make sense for DTV to even bother taking this to court unless the firmly believe they are not infringing. To me this is not really plausible given they were in discussions to settle. The pacers we see are 'typical' legal arguments to avoid paying. (ie you don't negotiate if you're not infringing, you go direct to court). Look up efficient infringement, as this is the strategy du jour for big tech. So if the ask was low as above, one would expect a company making billions, and knowing it is infringing to simply write a check from petty cash vs waste their time and money.
B. One would "Hope" that after ZTE, VRNG management is well aware that shareholders cannot stand for another long drawn out battle that will cost more than they receive as a payment and that 'ROI' matters. Have they? Time will tell, but I don't think Cohen is a stupid man, nor is the board. Perlman, well another issue but he's not the one 'truly' making the legal decisions here.
In the end while we all wanted a settlement quickly, this development tells us we are looking at big dollars and should there be other infringers, (comcast, google/youtube etc), it is very well worth it. Longs are all shell shocked, but at the same time, mgmt must do what is best to maximize the value of their assets. Again, that comes with a qualifier - on a positive ROI basis. I think this latter point is the factor we will learn more of down the road.
Good Luck to all REAL LONGS
