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Richard Chernicoff General Counsel & General Manager, Commercialization
Mark Cuban-Backed Device Identification Startup BlueCava Raises $1.5 Million
(Uniloc spin out BlueCava.) Commercialization?
Posted Jul 8, 2011 by Robin Wauters
BlueCava, a startup that has developed technology that enables its customers to identify unique connected devices such as smartphones, TV set-top boxes, gaming consoles, computers and more, has raised $1.5 million in debt funding according to an SEC filing.
Late last year, the company had already raised $5 million from billionaire investors such as Mark Cuban and oilman Tim Headington.
BlueCava says its device identification technology is actually about 15 years old and dates back to Australian inventor Ric Richardson, who was also the road manager for the band INXS.
Years after cooking it up in the nineties, Richardson’s idea became U.S, patent #5,490,216, and he later sued Microsoft (and many others) for infringing on his patent.
In 2009, a jury awarded Uniloc USA (which BlueCava was spun out from) $388 million excluding damages or interest in the case against the Redmond software giant.
You can read more back story here and here if you’re interested.
BlueCava says the technology can theoretically identify the 10 billion (citation needed) internet-connected devices on the planet. The identification helps its customers target advertising and combat fraud, among other use cases.
It’s a most interesting startup to keep tabs on – to give you an idea, its advisory board members include Joe Sullivan, Chief Security Officer at Facebook and Ellen Moskowitz, VP of Fraud Management Solutions at MasterCard.
http://techcrunch.com/2011/07/08/mark-cuban-backed-device-identification-startup-bluecava-raises-1-5-million/
Industry leading management team with proven track record
Highly scalable business model with significant operating leverage
$93.6 million pro forma combined licensing revenue over last 30 months of operations (unaudited)
$37.5 million pro forma combined licensing revenue over trailing twelve months of operations (unaudited)
119 active defendants and 101 trials projected through 2017
Up to 150 additional potential licensees
Large, diversified and active patent portfolio consisting of 662 patents
Scale and diversification potentially eliminates dependence on large, binary licensing or litigation outcomes
Gross margin improvement potential on future cases expected from economies of scale and Uniloc's relationship with law firms that work on a contingency fee basis
Secret Caps LLC comments:
"$MARA agrees to merge with Uniloc. Talk about a game changer. A new $QCOM in the making?"
Uniloc Launches Slew Of New Suits Over Registration Tech
By Jeff Sistrunk
Law360, Los Angeles (May 6, 2014, 4:44 PM ET) -- Uniloc Luxembourg SA launched a patent offensive on Tuesday in Texas federal court, accusing Canon USA Inc., ArcSoft Inc. and 14 other technology companies of infringing its anti-piracy software registration patent.
In 16 brief, near-identical complaints, Uniloc and its American patent licensee, Uniloc USA Inc., claimed the defendants infringed upon technology covered by U.S. Patent Number 5,490,216.
According to Uniloc, the defendants have infringed the '216 patent, entitled "System for software registration," by making and selling product registration and activation systems that are used in conjunction with programs including Canon's imageRunner Advance Desktop 3.0 and ArcSoft's ArcSoft Portrait+. Other defendants in the suits include music software maker Ableton Inc. and data protection company Acronis Inc.
Uniloc's patented technology is used in several markets, including software and game security and intellectual property rights management, according to the complaints. The plaintiff is seeking declarations that the defendants infringed the '216 patent, along with damages.
Representatives for the defendants either declined comment or did not immediately respond to requests for comment Tuesday.
Tuesday's wave of suits marked the latest chapter in Uniloc's efforts to enforce the '216 patent. In recent years, the company has filed at least two dozen other suits alleging infringement of the same patent, including against video game giants Activision Blizzard Inc. and Electronic Arts Inc.
In late March, U.S. District Judge Leonard Davis, presiding in Texas, refused to toss Uniloc's suit accusing Pervasive Software Inc. of infringing the '216 patent, which used a format similar to that of the complaints filed Tuesday.
Pervasive argued in its motion to dismiss that Uniloc failed to factually support its claim that Pervasive makes or controls a system that infringes Uniloc’s patent, as required by the pleading standard outlined in the U.S. Supreme Court’s decision in Ashcroft v. Iqbal.
“Uniloc merely indicates which claims it accuses Pervasive of infringing, states the elements of infringement ... and identifies a specific accused instrumentality,” Pervasive said. “These ‘threadbare recitals of the elements of a cause of action supported by mere conclusions’ must be supported by factual allegations.”
But Judge Davis rejected Pervasive's argument. While he didn’t directly address the high court's Iqbal and Bell Atlantic Corp. v. Twombly decisions, the judge stated that the Federal Circuit’s ruling in Centillion Data Systems LLC v. Qwest Communications International Inc. didn't support heightened standards for patent system complaints.
The judge therefore found that Uniloc had sufficiently outlined the ways in which Pervasive has allegedly infringed the patent, and allowed the suit to continue.
The patent-in-suit is U.S. Patent Number 5,490,216.
Uniloc is represented by E. Leon Carter, J. Robert Arnett III and Ryan S. Loveless of Carter Scholer Arnett Hamada and Mockler PLLC, by James L. Etheridge of Etheridge Law Group PLLC and by T. John Ward Jr. and J. Wesley Hill of Ward & Smith Law Firm.
The cases are Uniloc USA Inc. et al. v. ArcSoft Inc., case number 6:14-cv-00415; Uniloc USA Inc. et al. v. Ableton Inc., case number 6:14-cv-00416; Uniloc USA Inc. et al. v. Acronis Inc., case number 6:14-cv-00417; Uniloc USA Inc. et al. v. Altova Inc., case number 6:14-cv-00418; Uniloc USA Inc. et al. v. Cambium Learning Group Inc., case number 6:14-cv-00419; Uniloc USA Inc. et al. v. Canon USA Inc., case number 6:14-cv-00420; Uniloc USA Inc. et al. v. Chief Architect Inc., case number 6:14-cv-00421; Uniloc USA Inc. et al. v. Code 42 Software Inc., case number 6:14-cv-00422; Uniloc USA Inc. et al. v. Edgewater Marine Industries Inc., case number 6:14-cv-00423; Uniloc USA Inc. et al. v. Embarcadero Technologies Inc., case number 6:14-cv-00424; Uniloc USA Inc. et al. v. Encore Software Inc., case number 6:14-cv-00425; Uniloc USA Inc. et al. v. Juniper Networks Inc., case number 6:14-cv-00426; Uniloc USA Inc. et al. v. Kofax Inc., case number 6:14-cv-00427; Uniloc USA Inc. et al. v. Native Instruments North America Inc., case number 6:14-cv-00428; Uniloc USA Inc. et al. v. Perfect World Entertainment Inc., case number 6:14-cv-00429; and Uniloc USA Inc. et al. v. TLM Inc., case number 6:14-cv-00430; all in the U.S. District Court for the Eastern District of Texas.
•Industry leading management team with proven track record
•Highly scalable business model with significant operating leverage
•$93.6 million pro forma combined licensing revenue over last 30 months of operations (unaudited)
•$37.5 million pro forma combined licensing revenue over trailing twelve months of operations (unaudited)
•119 active defendants and 101 trials projected through 2017
•Up to 150 additional potential licensees
•Large, diversified and active patent portfolio consisting of 662 patents
•Scale and diversification potentially eliminates dependence on large, binary licensing or litigation outcomes
•Gross margin improvement potential on future cases expected from economies of scale and Uniloc's relationship with law firms that work on a contingency fee basis
Short interest declined
Short Interest (Shares Short)
319,400
Short Interest (Shares Short) - Prior
353,600
Short % Increase / Decrease
-10 %
Short Percent of Float
3.11 %
Short Interest Ratio (Days To Cover)
4.3
Good article hbassiouny.
Based on my interpretation, it would appear to support the continuing and increasing need for some to stand up for the inventors, much like Marathon and Acacia does. The small inventor is often said to be the root of innovation, where big companies are often simply aggregators of technology post development.
The real irony in all the patent reform discourse and alluding to some companies as patent trolls, while others not, is that ultimately a large portion of many of the largest companies in the world generate significant licensing revenues from their own patents. The hypocrisy is nothing short of astounding in that some clearly believe it's fine if we're benefitting, but take issue with others for doing the very same thing, a comlete double standard.
The system does need changing I agree. Recent opposition to early reform initiatives is telling in that many are now recognizing the adverse consequences to actual innovation and the small inventor. It's why recent attempts to slam through reform were again tabled for the year.
To me, there is simply no worse macro environment than what we've witnessed for patent monetization companies over the last year. The current standing President has fueled much of the uncertainty and his ties with Google are well known. A new administration has the potential of really bettering the entire situation for patent holders.
Whether it ultimately Clinton, Trump, or some other Republican, it will be a dramatic improvement in my opinion likely rebalancing power in favor of patent holders.
ipnoob,
Appreciate the article. I went a step further and reached out to a friend at Nasdaq for affirmation of my thoughts. You are welcome to do the same.
Response:
"I’ve attached the continued listing guide (available on the Nasdaq Listings Center website) https://listingcenter.nasdaq.com
We look at one of the three standards on page 4. The equity requirement based on Marathon's recent filings looks fine."
True story Msl2008!
LOL!
I can relate, used to look like Brad Pitt, now look more like Fat Bastard from the Mike Myers movies. ;)
I think his point was merely that Marathon was named the top performing PIPCO in 2014. It was up well over a couple hundred percent from low to high last year destroying the performance of the space which was predominantly negative. That is not his opinion, it is fact.
"They need to book business in... it is so important"
Totally agree with you. It's self-evident. Talk is cheap and results count.
Regardless of when we all invested, I'm certain nobody, including the company, is content or pleased with the current share price and relative performance over the year.
Well reasoned and un-emotional post Spacen.
On another important matter, whoever irresponsibly stated the company was at risk of a delisting should be more careful in their comments.
That appears to be a completely false statement based on my research. Per Nasdaq, potential delisting is applicable only if the stock price falls below $1, or there is less than $1M of public non affiliate float. Even if you receive a delisting notice having met such criteria, you have a year to cure.
Marathon is nowhere close to being in risk of such. If you believe otherwise, please provide a link for reference supporting your position.
Did you read the article. It's about Unified Commerce. What do you think NETE is trying to do? It couldn't be more relevant. The irony of my post being called a pump post when clearly there is an active promote going on with NETE, is comical.
Activist shareholder former CEO of Blockbuster may be making a run at SPDL (35 cents) Mobile payment and unified commerce.
http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
Blockbuster CEO Buys Big Chunk of Spindle
Tickers Mentioned: SPDL
The only thing constant is change, and nowhere do we see this better reflected than in point-of-sale (POS) solutions tailored for the retail marketplace. Technology continues to propel POS forward, enabling capabilities that have grown beyond merely accepting payments. Nowadays, you’ll see sleek tablet set ups at every cool coffee shop in America. There is a bright new world at every sales terminal seeking every smart phone.
Investors can often benefit from investing ahead of major technological shifts, and I am intrigued by former Blockbuster CEO Michael Kelly’s purchase of 10% of Spindle, Inc. ($SPDL), filing a 13Din the process, because it relates to an important area called Unified Commerce.
This is not the first rodeo for these senior payment executives who have an extensive intellectual property portfolio,with ninepatents issued/allowed,and fourprovisional patents covering ecommerce, mobile payments and security. In addition to achieving Level 1 Service Provider PCI compliance status, Spindle is a registered domestic Payment Service Provider/Payment Facilitator (PSP/PF), so this is a measured venture,and a clear play on the Unified Commerce space.
Increasing Margins with a Single-Source, Bundled Solution
Think about this: Unified Commerce is the ability for merchants to source a full suite of POS and mobile commerce capabilities, business management solutions, and advanced cloud-based services, all from a single point of contact. It calls for one solution provider that can package these in a single bundle in order to make implementation and management simpler for the end-customer — and increase margins for VARs by allowing them to provide valuable services that complement their existing offering.
Merchants already sell services such as data, networking, Internet, voice communications, accounting systems, and other services that support and comprise their entire back-office environments. It is a logical and even convenient progression, then, for retailers and restaurateurs to purchase a range of POS and mobile marketing services from these same partners.
By offering POS as part of a bundle, the reseller has the opportunity to oversee all elements of commerce for their customers—network design, systems integration, equipment certification, multisite deployment, marketing, sales, service, and back-office integration—thus increasing their role as an indispensable partner. In the process, the reseller will play a major role in advancing the marketplace, making it easier for hospitality end-users to adopt the next-generation capabilities that the latest POS services can deliver.
Capabilities such as mobile marketing services, online business management platforms, ecommerce solutions, and mobile coupon services are all powerful tools, but they are usually available individually through a disparate roster of vendors. The complexity of integrating these offerings has become a barrier to adoption and sales, with too many platforms and partners for retailers to manage.
A more streamlined, single-source “unified commerce” approach is sorely needed to drive adoption of these myriad services. The best party to execute this kind of strategy: The technology reseller, who can streamline and bundle these services along with the data and voice solutions they already sell.
Companies shift and pivot, and I am familiar with the players in and around Spindle, both the exit and the entry. I don’t know Kelly as an investor, but “Angels” in general, I am familiar with. We have one at our company – and they are generally similar, in that they often bite off big chunks and change the direction of whatever environment they enter. This will be no different, so following the story is methodical.
This is “big data” analytics at its best, now accessible even to the modest local merchant. If VARs can communicate these motivations to their customers in the hospitality industry, the impact on sales could be considerable, which is why I am watching this small stock – in many cases, good things come in small packages – plus, it seems wise to hop aboard the train of early adopters and thinkers like Mike Kelly.
- See more at: http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle#sthash.Uh5RHTY6.dpuf
Great move off the lows of last week. Congrats to those who took advantage of the deeply oversold conditions due to the toxic financing.
Keep a watch on SPDL, too up strong since being mentioned here.
Great article recently out:http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
So you don't actually know any of your assumptions to be true?
Wouldn't it be responsible to actually find out the truth prior to posting negative assumptions regarding outcomes to legal matters?
You are just assuming that since they received a ruling for a previous case the same day, that all cases will be similar? Can you please show us where the company, or courts, have shown that to be a reasonable assumption?
Assume = to make an 'ass' out of 'u' and 'me'.
SPDL 30 cents... Blockbuster CEO Buys Big Chunk of Spindle
http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
Blockbuster CEO Buys Big Chunk of Spindle "SPDL" 30 cents
http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
SPDL...Blockbuster CEO Buys Big Chunk of Spindle "SPDL" 30 cents
http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
Blockbuster CEO Buys Big Chunk of Spindle "SPDL" 30 cents
http://www.equities.com/editors-desk/stocks/technology/blockbuster-ceo-buys-big-chunk-of-spindle
Augusta...keep your eyes on that SPDL. It's the spec play in this space to own in my opinion. already moving higher in recent days. Clean cap table, no toxic financing and American based with its own PSP, loyalty, POS and marketing solution. True Unified commerce offering. NETE was long overdue for a bounce in light of action of recent months. Not sure if the toxic financing has run its course. Just can't understand why management would ever have done it to begin with. Undermines their credibility in my eyes but could be a good trade if the selling is exhausted. NETE is known for paying stock promoters so I expect more of the same, possibly the start of some today.
Yes, I believe if you look deeper in SPEX's once meteoric rise, you will find it to have been fueled by a large "paid for" promotional campaign complemented by almost no float. Good chance his involvement was not by chance, but by design as part of a compensated larger campaign. I believe what you saw there was deliberately orchestrated with likely the help of the company, or those invested in it.
I don't believe Marathon, or anyone associated with Marathon would endorse, support, or compensate a similar paid for stock promotion service.
Just looked at the tweets you reference. They look to just be in response to the recent strength and making note of it. First one just states MARA is popping.
I don't believe any of those small groups are responsible for, or even capable of generating the 100k share plus of interest we just saw. Bids that showed up were fairly sizeable (10,000) and not indicative of small retail day traders, quite to the contrary in fact.
In light of recent buying by Royce Funds for almost 500k shares, it could just as easily been them or another fund adding, or initiating a position.
What? Day trading service? Who and what are you referring to?
Side note: Acacia report from IP Hawk
I don't know if anyone else ordered Flyers (IP Hawk's) recent report on Acacia.
http://theiphawk.blogspot.com/
I have to say, it is one of the most impressive research reports I've ever seen. It is worth every penny and then some. The detail in the report is just incredible. One of the most informative things I've read in some time.
Good work Flyers, you've again out done yourself.
Thank you yanqui.
Patent Reform Slows Down in Congress
July 15, 2015?Dennis Crouch
by Dennis Crouch
Acting in bi-partisan fashion, leadership in the House of Representatives has reportedly removed Rep. Goodlatte’s Innovation Act (H.R. 9) from House Floor consideration for this summer – indicating that the bill is not yet ready for a consensus vote. (Summer session typically runs through the end of July with a break for the month of August).
Some amount of opposition had been building within Congress, including a joint press conference yesterday that included U.S. Representatives John Conyers (D-Mich.), Thomas Massie (R-Ky.), Bill Foster (D-Ill.), and Scott Peters (D-Calif.) as well as Senators Chris Coons (D-Del.) and David Vitter. In their press release, the group wrote that “H.R. 9 is strongly opposed by inventors, small businesses, venture capitalists, startup communities, and manufacturing, technology, and life sciences companies.”
A compromise bill has some chance this fall and we can expect more aggressive PR campaigns showing the woes of patent trolls as well as the benefits of patent-driven innovation.
Pretty fair and objective article. The reporter does a pretty good job of showing the other side of the "patent troll" debate. In particular, it's nice to see a legitimate media source feature the company on its front page.
While the editor's title was poorly chosen in my opinion only perpetuating the "troll" myth that the reporter worked hard to dispel, (editors are responsible for the title, not the reporters), it's really a nice piece that definitely introduces the company to a lot of people who probably never had heard of them prior.
Here are a few noteworthy outtakes since it may not legally be reproduced in its entirety absent permission.
(Doug Croxall loves a good underdog story, especially when the little guy wins)
(That's why as chief executive officer of West LA's Marathon Patent Group Inc. Croxall picks fights with large corporations on behalf of inventors and entrepreneurs, claiming patent infringement and demanding payment.)
("Many companies despise what we do, but so many inventors are glad we do it," he said. "Even though it's not popular, I love what I do.")
(Marathon's business model, like that of other patent-monetization companies, centers on acquiring patent rights from inventors and suing companies that could be making, using or selling products or services that in some way rely on patent-protected materials)
(Still, Latimore, the stock analyst, is confident Marathon is poised to continue growing despite the uncertainty that comes with regulation- and, of course, litigation. It's biggest asset, he said, is that it owns patents in very diverse industries, including health care, automotive and wireless communications, to name a few. "From an investment standpoint, it's good to have diversity so it's not all about one patent," he said. "If it doesn't go your way and you only have a couple of patents, so much for the business model.")
(Latimore rates Marathon's stock a "buy" with a target of $11 - indicating lots of optimsism about the firm, as shares closed July 22 at $3.02.)
(Croxall admits there are certain bad actors operating in the industry, but that doesn't mean every company is out to destroy businesses. "There are bad doctors, there are bad lawyers and their are bad businessmen," Croxall said "That doesn't mean you knock out the whole medical profession because there's one bad doctor.")
At this point Augusta, I'm going with SPDL as my spec play on this space. I can no longer trust management here and they've destroyed the cap structure with the toxic financing. Also, I'd rather gamble on a US small player rather than a foreign one like NETE. I expect a possible move higher in SPDL near term. Check out the recent 13D filed by former CEO of BlockBuster where he bought almost 10% of SPDL in a single transaction. Has to be something behind his recent purchase and he also owns Alpha Bay.
green,
ACTG not really trading after hours with any size, only 1900 shares traded thus far. Some up at 9.80 and some unchanged at 9.42/43.
Numbers appear good at first glance. I'd appreciate Flyers assessment.
Perhaps today's money flow into the name is the beginning of a more favorable macro environment and value buyers coming back into the space.
I too was encouraged to see ACTG trade off lows recently and up strong today on increasing volume. Let's hope it's the start of something.
In listening to the call as we speak, I personally think it very well done thus far. Looking forward to the Q&A.
Sure seems pretty inexpensive here, but do we know if the toxic financing has been exhausted yet? I also lack a little confidence in management in light of past lack of execution and even entering into this horrid financing agreement. It's all but destroyed the cap structure with dilution.
I like the space and just added to SPDL. I like better for a domestic play on the space.
Cap structure more shareholder friendly and the former CEO of Block Buster just purchased almost 10% of the outstanding shares and filed a 13D. I expect it could quickly double from current levels.
http://ih.advfn.com/p.php?pid=nmona&article=67350193&symbol=SPDL
Ask any CEO of any microcap company if they could land just one institutional name as a buyer of their stock, there's a high likelihood that Royce would be on their list. 40 years in the business and $24 Billion under management.
While there is no assurance this will happen, what often times does occur is that smaller funds will piggy back the investment of a larger institution like Royce. Smaller funds know that Royce likely did considerable work on the name prior to taking a position, therefore the smaller funds often rely on their due diligence leading to a possible follow on investment.
Long story short, smaller PM's can often view Royce's taking a position of a leading indicator of a name to look at and possible opportunity.
Generally speaking, the building of institutional interest in a small name is lead by a large fund taking a position rather than the opposite. Only time will tell if Royce is a beginning, and others soon follow, or if they are unique in their interest.
So according to your findings, Royce has bought just under 500k shares in what must be the last month or so.
The last time I checked institutional holding listed on Bloomberg, they were absent any ownership so it's clearly recent accumulation.
Porscha...22! Lucky SOB ;)
EMI,
Based on my math, about $6M of the $9M is already paid off. Therefore the extension is likely for an amount of $3M or just shy of it.
Thanks for the heads up on the buying from Royce. Royce is a big one, very well regarded. Nice to see them taking a decent position at these levels. $24 Billion under management.
https://www.roycefunds.com/about/
Ed,
Appreciate you taking the time to respond. I totally understand what your saying, results are what counts.
No argument from me whatsoever, I think we all agree.
Thanks again.
The court calendar published at the website may be of interest. Just in Germany alone, there are near term trials against Yahoo, Google and Apple.
http://www.marathonpg.com/patent-portfolio/key-court-dates
Foreign
MedTech Stryker GmbH & Co. KG Nullity 1st EP 1 938 765 B1 (DE 698 41 759.3) 07/21/15
TLI Communications GMBH Flickr / Yahoo! Inc. Infringement 1st EP0814611 07/30/15
TLI Communications GMBH Apple; Apple Retail Germany GmbH Infringement 1st EP0814611 09/17/15
TLI Communications GMBH Google, Inc. Infringement 1st EP0814611 09/17/15
Medtech SAM, G-21 s.r.l. Infringement 1st EP 1 104 260 B2 09/23/15
Well reasoned thoughts as always ms.
I would only add I don't believe he was necessarily trying to compare Apple and Marathon, rather using it as an "investing" example. There too was a point where Apple was somewhat out of favor and under-performing, it's future in question. Many forget that the path traveled by some of todays most successful companies was not always a straight one.
Regardless, I was wondering your and Ed's opinion of the recent interview by Croxall at Nasdaq and what do you guys think the apparently forthcoming Biomet settlement, could be worth?
Nasdaq Interview link:
http://edge.media-server.com/m/p/bac8ed5e
Marasprint,
It's what they do, they are trying to emulate RPX, generating revenues by getting people to pay them for their service. They have filed IPR's against others, even Acacia.
What is a better question and more telling to me, is why bother to file an IPR against a patent that doesn't even have any remaining defendants with almost all having already licensed it?
I think their own public notification of such, not limited to it being on their site and even issuing a tweet, is a nice marketing tool to give the appearance of them having accomplished something on behalf of their paying members, however most who understand the reality of the matter may suggest otherwise.
As is often the case, there exists virtually no connection between perception and reality imo.