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I am totally convinced that some people here could be holding the winning power ball ticket in their hands and have checked the numbers 10 times, but still would convince themselves that they hadn't won.
Mickey- Since you believe that the substantial progress statement made in the 8k reflects that a contingency agreement was reached that tied Nok's rates to Sam's less a discount, what would have happened come Nov 25th and Sam decided to let it ride? Remember, at the time of the 8k, the cases were still linked, and there is no possible way that Nok would allow its' destiny to be dictated by Sam. In my opinion, had the comment by Shay not been made and/or circulated on message boards, thus becoming a non-intended disclosure, line 1 of the Nokia update 8k would not have been included. If you put into context his remark, it would be very reasonable to assume that something would make April 11th a moot point in his opinion. Prior to Batts' decision, I believe that Nok was very seriously considering the strategy of settling with IDCC prior to its' showdown with Qcom, and that Shay's comment reflected his knowledge of how far they had progressed. This would have to be an unbelievable coincidence if the substantial progress statement and the unintended disclosure by an IDCC officer were not linked. I think that this is a far more probable explaination of why line 1 of the update was included, particularly in regards to timing. Everyone is entitled to their own opinion, but I don't think logic supports tying a statement of substantial progress to a contingent agreement. Mickey, I hope that you are correct, and that there is an agreement in place, that will be announced after Sam has announced its' payment option, but it is very difficult to understand how and why this agreement would have been made back in March. JMO
Sailfree- The 8k came out after the Batts' decision and in my opinion was a clarification of Shay's remarks regarding the effective date of her decision. The context of his remarks, not to worry about that date, most likely reflected his knowledge of on going discussions prior to her decision. IDCC felt that this required clarification-thus the 8k. After our 8k was released, remember that a Nok official commented that maybe the market was over reacting to the 8k. IMO
IMO-It's important to put the 8k re substantial progress in context of what had just happened. I don't think that it was a coincidence that it came out after Shay's comment regarding the date of Batt's decision being inconsequential. Also, Nok was still negotiating with Qcom and possibly using IDCC as leverage. Most likely progress had been made and a settlement was close, but when Batt's decision came down, all bets were off for the time being, and the strategy of settling with IDCC before Qcom, was tabeled. I do think that Nok will settle prior to the hearings start date, because going beyond that stage becomes a huge negative in their very important quest to penetrate the US market. The threat of an embargo is out of their control, and IDCC may decide to make Nok the poster child for all infringers now and in the future. Bargaining leverage changes when litigation costs continue needlessly and I don't think that the ITC wants to waste their time on a matter that would have already been settled had Nok not pulled a fast one on the ALJ. I would look for settlement to occur sometime after the Sam settlement payment option is announced and before the hearings begin. JMO
Makes sense to sell and take tax loss especially if you feel confident that you have a 30 day window of no news to propel stock upwards. Today's institutional seller(s) will probably be back in early Jan. IMO
IMO-There is a 0% chance of a ban being enacted and there is a 0% chance of a court determining a FRAND rate-that means a 100% chance of a settlement!
IMO- The primary reason for going before the ITC is to level the playing field when a party is using another party's product or ipr WITHOUT paying. Infringement without embargo does not accomplish the goal of the ITC, which is settlement. All cases that come before the ITC have an element of FRAND inherently involved, so the real issue is infringement. Infringement without harm to the infringer does not give any immediacy to settlement. I believe that it is crystal clear to the ALJ exactly what SAM and NOK have been trying to do, and delaying this further, by sending the case to another court to decide FRAND, is an exercise in futility. All parties know that this will end, NOT by a rate decided by a court, but instead by settlement. The ALJ is well aware of the multitude of companies that have licenses with IDCC-is he going to say that they were all chumps and that a company with a checkered past like SAM has it right? My bet is that Judge Luckern will rule in our favor and that the attornies for SAM have told the company as much. The only question is, settlement before the decision or after. There is a strategic move by SAM to wait till after the decision, if NOK has not settled before, because it then puts NOK in a tough spot knowing the judge has ruled in favor of infringement and embargo. I don't believe that the rates will change post decision, like some do, but the '06 2g bargaining tool may disappear. Anyway, good luck to IDCC-just one way of looking at it.
IMO- It would be totally out of character for the proud Fins to allow a third party to dictate the terms of a major license. This is exactly what they are facing now, because their no.1 competitor is at a sh*t or get off the pot moment and will do what is best for their(Sam) company. Sam also has a negotiating carrot that Nok doesn't have and a time constraint that is immediate. What did Nok's end run around the ALJ really get them? They have created more cost and time to all parties, but really the only thing they gained was a perception of not having to deal with the immediate time constraint. If Nok chooses not to settle before the ALJ decision, they then have chosen to put themselves in a position where Sam could set frand rates and put Nok behind the infringement 8-ball. Only the 3 parties know how far apart they are, but has the decoupling of Nok/Sam really changed Nok's approach to getting the best deal for them? The one word that Nok/Sam fear the most is INFRINGEMENT, and this is exactly what the ALJ decision will be focused upon. With the game changer approaching, will prudent business decision making rule the day or is there some sinister plan at work here? My guess is, that it is every man for himself now, and that the best deals will be cut prior to the ALJ decision. GLTAL!
The interesting adjunct to all this and what may well affect the decision making of all parties, is the consolidation/deconsolidation scam that Nok perpetrated on the ITC. The ALJ can not be happy about being played by Nok and the time gaining ploy may backfire. If both Sam and IDCC felt that the ALJ would rule in IDCC's favor and they had come to an agreement on price, it would be to both parties advantage to have a ruling announced. Nok would be left holding the infringement bag and the time factor that Nok thought they were gaining would definitely be shortened and most probably lead to a settlement dictated by the FRANDLY terms of Sam. Maybe there will be justice after all. JMO
If a reasonable assumption can be made that the eventual outcome of this saga is settlement, then the major question becomes when. We have our first time threshold coming up on Nov 25th with 5 possible outcomes pre announcement:(1)only Sam settles(2)only Nok settles(3)both Sam and Nok settle(4)neither party settles(5)a white knight appears with a bid for IDCC and the proceedings are put on hold. What is the most probable outcome of the five above and why? First, lets look at number 4 and the probability that neither settles and what ramifications and risks are associated with this decision. All three parties now have a pretty good risk profile as to what the ALJ will decide. Obviously, if Sam feels that the ALJ will side with them, then they will let the decision be rendered. This, however, has a direct effect on Nok, in that if the decision goes against them, Nok's bargaining position is weakened with the stigma of infringement by proxy being a matter of public record. The point is, that the risk profile changes drastically for one or more parties post announcement. Looking at number 1,only Sam settling before the announcement, we still have the problem of dealing with Nok without the benefit of a favorable ALJ ruling, which we may feel very good about. Number 2 makes sense only if Nok makes an 11th hour offer that is designed to put their chief competitor behind the infringement eight ball. Number 5 is for conspiracy theorists that believe that the Qcom/Nok settlement contained an incentive for Qcom to come to their rescue at the final moment. Number 3 presents a win situation for all parties(including the ITC)involved. How do both parties agree to a settlement before Nov 25th? If Sam and Nok presented a reasonable rate to IDCC on the basis of a one time offer of BOTH signing pre Nov 25th, I would think that a deal could be made. JMO
Another way to look at this situation-what ramification(s) does the ALJ decision have on the future of the ITC and its' effectiveness in protecting US patent holders against infringers. If a vague French law can supercede blatant infringement and remove permanently any threat of injunction, then the ITC may as well close its' doors. Another effect of the upcoming decision is how future standard boards will be structured. Why would any non manufacturer, that owns a patent that would definitely be considered essential, ever declare? So, the question Sam and Nok have to answer at this point is, do they want to roll the dice and have an ALJ decision in favor of injunction become a matter of public record, or is it better to settle before Nov 25th and still be able to play the same stall game with future generations of wireless? Even if they roll the dice and the matter goes to a FRAND court,there is no possible way they would want a court to decide their rates, and the power now shifts to IDCC, because we may feel that settling is no longer an option. The power of all our other licenses with top name manufacturers,along with the history of what Sam and Nok have tried to do to essentially put us out of business, would not be lost on the court in setting rates. The upcoming decision by the ALJ is a game changer for the wireless industry and Sam and Nok have plenty to lose, but ultimately not as much to gain. JMO
Unless I'm under the wrong impression, I thought the whole idea behind the ITC is to impose economic sanctions against those that infringe without paying. The economic sanctions level the playing field for settling the economic prong. How easy it is to muddy the waters and redirect away from the main issue and purpose for bringing action before the ITC. IMO.
I realize that it is common practice for defense attornies to attempt to side track the main issues of a case, especially when the main issue for their client is very weak. In this case, I don't think that the ALJ will buy into the side track regarding FRAND, basically because INFRINGEMENT is the main issue and cannot be justified because of a disagreement in rate. I have NO legal background, but it seems to me that if this case is allowed to go down the FRAND pathway, then the ITC is opening up a new can of worms that in effect changes not only its' own powers but also those of standards boards. JMO
If a company is allowed to infringe upon another company's patents without facing an injunction, simply because, in their opinion the rate offered by the patent holder is not fair, even though the rate has been established many times in the market place, then the ITC has been rendered moot. IMO
The big question in the next 2 months is whether the risk to both sides is great enough to forge a settlement. When both parties have something to lose, then settlement has its' greatest chance. In a convoluted way, the staff decision may be the catalyst to get the deal done, as there is now a real risk to IDCC to let the dice roll. Allowing this thing to go past the ALJ decision could be disaterous to either side and that includes Nok. A declaration of infringement is not what either Sam or Nok can afford to hear, and on the IDCC side, finding out that this endeavor was fruitless and is being tossed to the Frand court would be a devastating blow to shareholders for the intermediate term. My hope is that both sides aren't as pig headed as Jerry Yang at Yahoo, and that they realize that value isn't absolute and can be negotiated to the benefit of all parties. Gltal!
Amazing! How does the market lend credence to an obscure "analyst" who bases his opinion on partial information that is 2 months old and who then predicts that a settlement before nov 25 is likely? That is such unbelievably poor logic, that it makes even a bigger joke out of a guy who fell asleep during the hearing. The saddest commentary of all is that the "market" actually reacts to this garbage.
In trying to understand the french law of implied license, I came across the law firm of dla piper and in their overview of french law it seems that the ipr holder has very strong rights and even mentions the non recognition of implied license theory. Any attornies here have knowledge of this firm? google dlapiper.com/france. tia.
Ghors or any of the legal minds- If the legal system construes that a standard setting body, that had no intention of dealing with licensing issues, has indirectly granted implied licenses to anyone declaring essential patents to that standard, then why would any non manufacturer ever declare to a standards board in the future? It seems that this type of ruling would, in the future, render a standards board meaningless, sanctioning open ended infringement of a company's ipr without any time remedy. Is there something that I am missing here?
Gamco or any of the option guys- I can understand the sell side of the large option transaction, but the buy side has me puzzled. Is it possible that the buyer has a large short position and that 1.5 million shares of that position are naked? The only way to obtain shares to deliver was to broker a deal with a holder of a large sum of shares at an agreed upon price, thus the Sept expiration. Just a guess and probably a stupid one, but this would cause the least disruption of price to cover a naked position.
Gamco- I know next to nothing about option strategies, but this does look like a pre arranged deal with both sides hedging their current positions against an event occuring before Sept 18. The only events that I can think of that could bump up the stock over $4 in the next month would be signing either nok or sam or a takeover bid. If this date passes without a major event happening would you expect this same bet to be made again for Dec expiration, especially in light of what could occur on Nov 25th?
Part II to the strategies of both sides is the effect to Nok if Sam decides to let it go the distance. If the ALJ sides with IDCC and infringement and injunction are in order then Nok is up sh*t creek without a paddle. Nok's dilemma at this point is that it risks Sam dictating its' future. I agree with my3sons as to validity and the real issue is now the very weak implied license defense favored by staff. Use of IDCC ipr by Sam is a no brainer, the only question remains was it used under implied license or was it infringed. The latter will bring injunctive relief and the DELAY game is officially over-ADVANTAGE IDCC. How much influence does Nok have on its' number one competitor? My bet is that Nok will not chance Sam making a blunder that affects Nok's ability to control its' own destiny. The only reason, other than actually believing in the implied license defense, that Sam would risk taking this the distance, would be if it is merely bluffing on the rate and is willing to accept the current IDCC terms, thus in convoluted logic it gets a free shot at more delay. This strategy could really backfire and points all the more to why it is in the best interest of all parties to settle BEFORE the ALJ renders his decision. IMO
dndodd- I would sure hope the 2g monies would be in our hands before Nov. 25th, but the point is that after that date(assuming a ruling is made) the game changes dramatically and IDCC may not even consider 2g $ as a part of the mix-win or lose at the ITC.
With a little over 3 months to go until a possible DD(deliverance from delay) day, it is interesting to look at the various strategies that Sam may be contemplating. Does Sam roll the dice and allow the ALJ to rule or does it settle prior to Nov 25th? If Sam takes it all the way, it risks a ruling of infringement and injunction( although this must be confirmed by the commission ) and with this ruling, loses any type of negotiating leverage it may have had ( ie: staff recommendation, 2g monies ). The TIME element would dramatically shift to IDCC's favor because of the injunction. On the other hand, if the ALJ sides in favor of the implied license defense, Sam knows that this is only a delay of the inevitable, as proceedings will move to the FRAND trial. This would give Sam the upper hand in negotiations because of the TIME element as I doubt that IDCC would want to string this out another 2 years. IMO, this comes down to what probability of success does the legal staff at Sam assign to an implied license defense? What is the pucker point for both sides prior to Nov 25? Negotiating leverage for both sides will dramtically change after this date. All in all, this is shaping up to be one incredible Thanksgiving weekend-lets hope we can be giving thanks to a very astute ALJ or be celebrating a settlement. GLTAL
Revlis- Where did you see this? I could be wrong but I thought Sam said that by their estimations the top end of their range was just above 1/2% and that we were asking twice that much. Can anyone pull up those comments? thanks.
vtem01- I thought that the Sam attorney said that we were asking twice what Sam thought was fair( 1/2% at the high end ), so this puts our demands at around 1%, which translates to ? per phone. Seems to be alot of confusion over % and $ per phone.
IMO- THE reason we are before the ITC is to put an end to the delay game perpetrated by Nok and Sam. Serious financial consequences, like those they are causing IDCC, is the ONLY thing that will end this charade and bring Nok and Sam to settlement. Without this threat, appeal after appeal would string out negotiations for years, and that is why I believe that the ALJ and commision will find infringement with subsequent injunction to override any argument regarding implied license. The ALJ is witnessing first hand the games that are being played by these two foreign powerhouses to deny an American company from receiving just compensation for its' IPR. This judge has not missed the point of how ridiculous the whole FRAND concept is and can see that without leveling the playing field, negotiations will never be serious. TIME is a major concern and hopefully it is about to run out for Nok and Sam.
IMO- I wouldn't be too worried about the latest appeal from Nok as I believe that it is simply a predicted action in settlement gamesmanship. Nok's only leverage is threatened appeals at every juncture, while IDCC is in possession of the ultimate hammer-letting this thing go all the way and forcing a third party to set Nok's rates. There is not one chance in hell that Nok will allow this to happen, nor will they put themselves in a position to have their products embargoed. I also can't see Nok allowing the possibility of Sam setting a frand rate ahead of them. This all leads me to believe that Nok's QCOM agreement has set the blueprint for how Nok will ultimately settle with IDCC and that involves leveraging their superior patent position versus Sam etal to get a rate that others can't match. I think we are closer than the market thinks in this regard. GLTAL!
IMO- Nok is a very smart organization and they will not allow an ITC investigation or a FRAND court to undermine their monumental agreement with QCOM and potentially destroy any momentum for their product rollout in the USA. The genius of their recent agreement with Q lies in the competitive edge they locked in for 15 years by leveraging their superior patent position over Sam and others. Discounts based upon volume can change in a heartbeat, but the huge advantage Nok has over Sam in the essential patent category can never be changed. Qcom doesn't have to worry about discrimination with regards to Sam and others because they know that they don't have any patents to give up to get the same rate as Nok. Could a similar strategy be forged with IDCC, now that IDCC is producing chips? This is a tremendous opportunity for Nok to further distance itself from Sam and lock in a competitive edge that will translate into pricing power that Sam has no chance of matching. You have got to hand it to those Finns, as much as I can't stand their arrogance or morals, they have figured out a way to parlay their ipr edge while keeping their main competitor holding the proverbial bag. This may also be why IDCC mentioned that the economic piece of an agreement was reached-now hashing out which patents will be part of an agreement is the last piece. This is pure speculation on my part, but I think that the Q agreement for Nok represented a new way to insure pricing power without worrying about market share discounts to current and future competitors.
Since we are awaiting news to propel our stock forward, any guesses out there what Sam arb confirmation and Batt's reversal would be worth? We were given a $6+ haircut on an opinion from one man, that may never be realized, so what would a large sum of money and/or a decision to bring Nok back to the ITC immediately be worth? Better yet, any ideas what a Nok settlement announcement would do, even though no details would be released? I'd be curious to see what others think about these potential events and the price effect.TIA
Just saw IDCC up $1.97 in ah.
IMO-There are two things that Sam and Nok will NOT allow to happen:(1)an injunction (2)court determined FRAND rates. With this in mind, the game is one of negotiating leverage. For the next four months Sam has a PERCEIVED advantage due to the staff's finding of no violation. This perceived leverage disappears Nov 25 when the ALJ rules. Even if no injunction is the ultimate ruling, the game merely chages venues to the FRAND proceedings, where IDCC holds the leverage due to its' option to let it go the distance with the court deciding the rates. There is no way that either Sam or NOK allows this to happen, especially in light of documented remarks by NOK representatives regarding the value of essential patents. Allowing a third party to dictate rates is totally unacceptable, which is why the previously triggered license Nok had with IDCC was negotiated away. This thing is coming to a head soon, because I think that Nok is paranoid that No. 2 Sam will establish a FRAND rate for them. I would not be surprised to see Nok step ahead of Sam and negotiate their own rates, meanwhile letting Sam play the FRAND game if they so choose.
One reason that SAM attorney went into the FRAND situation in his opening remarks, MAY, be that the crux of the staff's decision was that he bought the French Law defense. The way I interpreted this reasoning is that once a patent is declared essential, it is to be made available to all at a FRAND price. Therefore, if you make an offer to pay for the ipr and can't settle on a price, the issue isn't infringement, but simply a price dispute to be settled by negotiation or a court. This may explain, how IDCC feels that the staff had sided with IDCC on several issues(SAM is using IDCC ipr in their phones). Our attornies have had over 3 months to poke holes in the staff's position and it seems that Nok wasn't too confident that the staff's conclusion would hold up-at least judging by their actions after receiving the report. This is all conjecture on my part, but I feel that this whole thing will be settled before Nov 25-not court decided.IMO
I thought the purpose of a hearing is to present both sides of an argument. We simply are seeing the staff presenting the public perspective that an injunction is not justifed for reasons we don't know. Our attornies do know the reasoning and I am sure, are very well prepared to attack their logic or lack thereof. This hearing is a point, counterpoint for the judge and commision to be able to hear all viewpoints and then make a well thought out decision. Of course Wall Street has a downside bias in general and particularly to IDCC, so we get an overblown reaction to an opening remark that becomes headlines. I don't think for one minute that anyone connected to this case really believes that SAM is not using our IPR in their product. Price is the only issue and that point is not what one company feels that it DESERVES. Our "ask" price is what we want and their "bid" price is what they think they should pay, but there is no "getting the price we deserve-go get 'em Billy" concept that has any chance of prevailing. We will likely meet somewhere in the middle and when a settlement is announced, we won't know any details anyway-so for at least 6 months a guessing game as to price per phone will ensue. Keep your eye on the only issue-FRAND. IMO
IMO- The real issue between the parties has always been FRAND and the ITC action was initiated to put a time stamp on this issue. All parties have known from the beginning that an injunction would never actually come about, but a threat, with a real date would set a sense of urgency to the negotiations. Today, the staff(one guy's opinion?)stated that it believes that no violation has occurred to warrant an injunction. We don't know the reasons behind the conclusion, but a good guess is that infringement isn't the issue, only FRAND, and the feeling is that for the public good, this issue should not justify an injunction. For now it appears that SAM has gained some leverage, but they know that Nov 25 could deliver a very different message. Does SAM take this opportunity prior to Nov 25 to negotiate with IDCC or does it roll the dice with the ALJ and even if no injunction is issued, face a pissed off IDCC in a FRAND case that IDCC lets go all the way? NEGOTIATED SETTLEMENT is and has always been the outcome of this battle about price.
IMO-ICC arb results for Sam should be released soon and I believe that final negotiations to resolve all issues will begin in earnest. With a new management team in place for Sam, they will not want to even get to the hearing stage or risk release of the staff report. The trigger is the ICC and lets hope their findings are released in the next couple of weeks.
idccjoe- I agree, one of the best in a long time. Very confident tone with a little swagger and definite resolve to carry out short and long term plans. Reminded me of BTO's song "You aint seen nothin yet."
IMO- The timeframe that Nok has to negotiate its' best deal with IDCC is dwindling fast. Several variables are about to play out that Nok can not control and if any one of them go against Nok,negotiating strength also diminishes. The fishing expedition(tdd/arb) could leave the dock without one of its reserved guests or the entire expedition could be cancelled. With the amount of money Nok is putting into its attempt to increase market share in North America, launching this endeavor with a dark cloud hanging over it, that could reach category 5, would be economic suicide. Nok knows the ultimate outcome and delay is no longer to their advantage, especially when the river card is about to come out and they know they are merely bluffing. I could see an agreement coming any day and certainly would not want to be holding a short position over a weekend.
JD GATOR- You spell like your name should be JD SUN DEVIL-sorry couldn't resist-suspension!
In the appeal process on Nok's right to arbitrate will the issue of when Nok was aware of this avenue be scrutinized? If it is, can records be subpoenaed to establish this timeline? What if there is a smoking gun that establishes that Nok was well aware of this defense before asking for consolidation and more importantly during the Delaware litigation. Wouldn't this one situation turn the entire arbitration question in favor of the ALJ's original determination? imo
garycoal- The only way this makes any sense is if Sam and Nok are pulling a power play to get the service providers to pay part of the cost. imo