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Methinks he doth protest too much!!!
InterDigital Communications Corp.
InterDigital Communications Is Heading Higher On Arbitratino Award
- Sep 6, 2006 08:59 AM (RTTNews)
- http://www.quote.com/home/news/story.asp?story=60971639
===========================================================================
(RTTNews) - InterDigital Communications (IDCC) announced Wednesday morning that the Tribunal in the arbitration proceeding between it and Samsung Electronics issued its Final Award. The Tribunal awarded InterDigital approximately $134 million in past royalties plus interest. The Tribunal also established the royalty rates to be applied to Samsung's sales of covered products in 2006. InterDigital is now trading higher by 2.21 on 4K shares.
InterDigital Communications made gradual gains for the majority of Tuesday's session and closed higher by 1.07 at $34.25. The stock closed challenging resistance at the highs of the year, trading at a 2-month high.
Ahh yes, today's action reminds me of the "good 'ol days" of Dec 1999. The monkeys finally off our backs!!!
Maddog
"Following an assessment of the Company's achievement of its 2005 annual
goals and individual performance during 2005, the Compensation Committee also
approved bonus awards under the Company's Annual Employee Bonus Plan for the
Chief Executive Officer and the executive officers, most of which is expected to
be paid in February 2006. The following annual bonus awards were approved for
the Chief Executive Officer and the named executive officers.
Mr. William J. Merritt, Chief Executive Officer $192,717
Mr. Richard J. Fagan, Chief Financial Officer $111,925
Mr. Mark A. Lemmo, Senior Business Development Officer $104,859
Mr. Lawrence F. Shay, General Counsel $100,326
Mr. William C. Miller, Senior Engineering and Programs Officer $ 84,561"
WOW - Sure would be nice if the shareholders were aware of what the "annual goals" and "individual performance" thresholds were.
Maddog
"I am pleased with today's court decision," commented William J. Merritt, President and Chief Executive Officer of InterDigital. "We have always believed that any challenge to the Final Award would ultimately fail. In rejecting all of Nokia's arguments, the federal court confirmed our belief. With yet another legal challenge dismissed, we are hopeful that Nokia will finally comply with its signed license agreement with InterDigital. If not, we will continue to pursue all legal remedies to secure payment. In that vein, as we announced yesterday, we have taken action to utilize the contractual dispute resolution process with Nokia in order to accelerate the resolution of any outstanding issues that Nokia might allege. We remain confident that Nokia will pay the amounts due, either of its own accord or by court order."
By: jimlur
11 Aug 2003, 04:58 PM EDT
Msg. 120068 of 120081
Jump to msg. #
To All , I sent this message to RB and would encourage all to copy and paste it and send to the Bull so they can make the changes.
JimLur
I own the IDCC Club board and no longer participate. A member of that club TeeCee is interested in taking over the responsibility of that club.
My old e-mail address for the user name jimlur was xxxxxxx.com.
Please transfer the ownership and contact the user TeeCee at xxxxxxxxx.net
His name is Anthony
I'm sure this person will bring back this Club to the level it once was.
Thank You
James J. Lurgio
Jim, so what the heck are "they" waiting on????
"the licensing relationship is not fully developed as yet nor fully defined."
IMO, this should have been "developed" many moons ago.
Maddog
HOT OFF THE WIRE PORTFOLIO NEWS - from Lycos Finance
(BB:BESC) Bestnet Communications Corp (BB)
BESTNET COMMUNICATIONS CORP FILES FORM 8-K (BESC)
- Jul 14, 2003 03:53 PM (EDGAR Online)
SECURITIES AND EXHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OF 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 11, 2003
BestNet Communications Corporation
(Exact Name of Registrant as Specified in its Charter)
Nevada 001-15482 86-1006416
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification Number)
5075 Cascade Rd. SE, Suite A. Grand Rapids, MI 49546
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (616) 977-9933
ITEM 5. OTHER EVENTS.
BestNet Communications Corp. announces record fiscal 3rd Quarter 2003
results.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits:
Exhibits Title
-------- -----
99 Press release, issued by BestNet Communications Corporation
Dated July 11, 2003
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BestNet Communications Corporation
By: /s/ Robert A. Blanchard
------------------------------------
Robert A. Blanchard
Chief Executive Officer
By: /s/ Paul H. Jachim
------------------------------------
Paul H. Jachim
Chief Financial Officer
Date: July 14, 2003
TYPE: EX-99 OTHERDOC
SEQUENCE: 3
FILENAME: ex-99.txt
DESCRIPTION: PRESS RELEASE DATED JULY 11, 2003
OTHERDOC AVAILABLE Series=ex 99.txt Ver="": Document is copied.
EX-99
Press Release dated July 11, 2003
BESTNET COMMUNICATIONS ANNOUNCES RECORD FISCAL
3RD QUARTER 2003 RESULTS.
GRAND RAPIDS, Mich.--(PR Newswire)-- July 11, 2003--BestNet Communications
Corporation (OTCBB: BESC - News), a provider of proprietary global communication
solutions, today announces its results for the third quarter of fiscal 2003.
As stated in a previous press release, revenues for the quarter totaled over
$387,000 USD setting a new record and up 31% over the same period of fiscal
2002. Gross margins more than doubled based on the same period comparison and
are continuing to improve. EBITDA, which represents virtually all of the cash
used in current operations on a monthly basis is down over 62% based on fiscal
2003 and 2002 third quarter comparison.
Robert A. Blanchard, President and CEO of BestNet Communications Corporation
commented, "The third quarter of 2003 was one of continuous improvement and
growth for us. I am particularly pleased with our continuing record setting
revenue growth and strategic deployment of cash resources. The fact that revenue
is up 31% while cash used is down over 60% in comparable periods indicates we
are making good choices with our marketing and sales initiates. This is further
reinforced by the increase we have seen in both corporate and active accounts
this fiscal year to date. Thus far we have added over 350 new corporate accounts
along with 4,000 new individual accounts. I encourage our investors to listen to
our audio update which can be found at http://www.bestnetcom.com/investor.htm
and review our 3rd quarter 10 Q which will be filed next week for more detailed
information on the progress we are making."
BestNet also announces today that it will hold a meeting of its shareholders on
Wednesday September 17th, 2003 at a location and time to be announced to provide
a comprehensive update and conduct business important to all shareholders.
Details on the meeting will follow.
About BestNet Communications Corp:
BestNet Communications is a global communication solutions provider of
international long distance, conference calling and ClicktoPhone communication
services. BestNet's services are accessed via the internet and delivered using
standard phone lines. This results in a cost effective, high quality service for
both businesses and consumers.
Under the brand name Bestnetcall(TM) (www.bestnetcall.com) patented services
offer clients premium quality calls and conference calling worldwide, at
significantly lower rates. Calls and conference calls can also be launched via a
desktop application or handheld devices including Palm(TM), Pocket PC(R) and
Blackberry(TM) and used with any standard or wireless phone. In addition the
company's new ClicktoPhone(TM) service (www.ClicktoPhone.com) enables clients to
add secure and anonymous voice communication connectivity anywhere in the world
to web sites, web banners, pictures, electronic documents, and customized e-mail
calling buttons. BestNet's communication solutions are now powered by our new
GlobalPlex technology.
BESTNET COMMUNICATIONS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MAY 31, 2003 AND 2002
2003 2002
----------- -----------
(UNAUDITED) (UNAUDITED)
Revenues: $ 387,769 $ 296,641
----------- -----------
Expenses:
Cost of revenues (exclusive of depreciation and
amortization shown separately below) 346,181 279,778
General and administrative expenses 371,855 546,660
Depreciation and amortization 556,562 572,278
----------- -----------
Total expenses 1,274,598 1,398,716
----------- -----------
Loss from operations (886,829) (1,102,075)
----------- -----------
Other income (expense):
Interest income 1,876 890
Interest and finance charges (308,724) (205,296)
Preferred stock conversion penalty -- (3,749)
Foreign asset tax expense -- (50)
Loss on sale of assets -- (257)
Other (expense) income (2,073) 600
------------ -----------
Total other expense (308,921) (207,862)
----------- ------------
Loss from continuing operations (1,195,750) (1,309,937)
Discontinued Operations
Operating income from discontinued operations -- 323
Loss on sale of discontinued operations -- (332)
----------- ------------
Loss from discontinued operations -- (9)
----------- ------------
Loss from operations (1,195,750) (1,309,946)
----------- -----------
Preferred stock dividends 265,006 1,540
----------- -----------
Loss available to common shareholders $(1,460,756) $(1,311,486)
=========== ===========
Loss per common share, basic and diluted
Continuing operations $ (.06) $ (.08)
Discontinued operations -- (.00)
----------- ------------
$ (.06) $ (.08)
=========== ===========
Weighted average number of shares outstanding,
basic and diluted 26,103,580 16,289,189
=========== ===========
See accompanying notes to condensed consolidated financial statements
BESTNET COMMUNICATIONS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
MAY 31, AUGUST 31,
ASSETS 2003 2002
------------ ------------
(UNAUDITED)
Current Assets:
Cash and cash equivalents $ 607,424 $ 351,784
Certificate of deposit -- 22,773
Accounts receivable, less allowance of
$387 and $7,826 63,875 72,844
Prepaid expenses and other current assets 53,213 71,801
------------ ------------
Total current assets 724,512 519,202
Property and equipment, net of accumulated
depreciation of $2,969,931 and $2,335,732 1,081,041 1,625,348
License fee, net of accumulated amortization
of $4,966,841, and $3,930,258 4,707,927 5,744,510
Note receivable from Softalk 1,569,608 1,508,043
Deposits and other assets 100,237 103,297
------------ ------------
Total assets $ 8,183,325 9,500,400
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses $ 821,152 $ 700,270
Notes payable, net of discount of $209,097 and $96,875 455,903 203,125
Deferred interest income 190,888 129,323
Deferred revenue 12,627 13,407
------------ ------------
Total current liabilities 1,480,570 1,046,125
Long-Term Liabilities:
Capital Lease 14,343 --
------------ ------------
Total long-term liabilities 14,343 --
------------ ------------
Total liabilities 1,494,913 1,046,125
Series A Preferred Stock and Warrants 420,216 --
STOCKHOLDERS EQUITY
Common stock, par value $.001 per share; 50,000,000 shares
authorized; 29,948,104 and 16,530,005 shares issued and
outstanding 29,948 16,530
Additional paid-in capital 33,860,988 31,041,961
Accumulated deficit (27,622,740) (23,488,980)
Common stock subscribed, underlying common shares of
0 and 1,866,842 -- 884,764
------------ ------------
Total stockholders' equity 6,268,196 8,454,275
------------ ------------
Total liabilities and stockholders' equity $ 8,183,325 $ 9,500,400
============ ============
See accompanying notes to condensed consolidated financial statements.
Contact BestNet at: investors@bestnetcom.com
THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION
21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, WHICH ARE INTENDED TO BE
COVERED BY THE "SAFE HARBOR" CREATED THEREBY. THESE STATEMENTS INCLUDE THE PLANS
AND OBJECTIVES OF MANAGEMENT FOR FUTURE OPERATIONS. THE FORWARD-LOOKING
STATEMENTS HEREIN ARE BASED ON CURRENT EXPECTATIONS THAT INVOLVE JUDGMENTS WITH
RESPECT TO, AMONG OTHER THINGS, FUTURE ECONOMIC, COMPETITIVE AND MARKET
CONDITIONS AND FUTURE BUSINESS DECISIONS, ALL OF WHICH ARE DIFFICULT OR
IMPOSSIBLE TO PREDICT ACCURATELY AND MANY OF WHICH ARE BEYOND CONTROL OF THE
COMPANY. ALTHOUGH THE COMPANY BELIEVES THAT THE ASSUMPTIONS UNDERLYING THE
FORWARD-LOOKING STATEMENTS ARE REASONABLE, ANY ONE OF THE ASSUMPTIONS COULD BE
INACCURATE AND, THEREFORE, CAN BE NO ASSURANCE THAT THE FORWARD-LOOKING
STATEMENTS INCLUDED IN THIS RELEASE WILL PROVE TO BE ACCURATE.
HOT OFF THE WIRE PORTFOLIO NEWS - from Lycos Finance
(BB:BESC) Bestnet Communications Corp (BB)
BestNet Communications Launches New Proprietary Global
Communication Platform
- Jul 9, 2003 06:21 PM (PR Newswire)
- http://finance.lycos.com/home/news/story.asp?story=34797468
===========================================================================
GRAND RAPIDS, Mich., July 9 /PRNewswire-FirstCall/ -- BestNet
Communications Corporation (BB:BESC), a provider of
proprietary global communication solutions, today announces a new chapter in
its history with the completion of development, successful testing and
implementation of its next generation technology called GlobalPlex.
Robert A. Blanchard, President and CEO of BestNet Communications
Corporation commented, "Today marks the most significant milestone to date for
our company. The development of our own propriety communication technology
platform solidifies our position as a fully independent global communication
solution provider. GlobalPlex technology has been specifically designed by
BestNet to easily interface with current and future commercially standard
applications and evolving technology such as VoIP and mobile solutions. This
allows BestNet greater scalability, customization and flexibility to serve our
current and future customers. GlobalPlex's architecture will facilitate joint
ventures, partnerships and alliances with other companies operating in our
segment. Ultimately, this will lead to greater revenue growth and shareholder
value, reinforcing our confidence and optimism about our future."
Paul Jachim, Chief Operating and Financial Officer of BestNet
Communications stated, "We built GlobalPlex to be fully integratable with new
applications, other networks and direct-dial telephone access. We plan to
launch an array of enhanced services and feature sets in the upcoming months
based on the open accessibility and improved interfaces GlobalPlex provides.
This will enable us to expand delivery of our value proposition which is high
quality communication solutions at affordable pricing. We are in the process
of transferring our entire client base to our GlobalPlex technology for
improved performance, greater reliable, customized solutions and greater
access options though new and improved calling applications delivered through
our network."
About BestNet Communications Corp.:
BestNet Communications is a global communication solutions provider of
international long distance, conference calling and ClicktoPhone communication
services. BestNet's services are accessed via the Internet and delivered
using standard phone lines. This results in a cost effective, high quality
service for both businesses and consumers.
Under the brand name Bestnetcall(TM) (
www.bestnetcall.com
) patented
services offer clients premium quality calls and conference calling worldwide,
at significantly lower rates. Calls and conference calls can also be launched
via a desktop application or handheld devices including Palm(TM), Pocket PC(R)
and Blackberry(TM) and used with any standard or wireless phone. In addition
the company's new ClicktoPhone(TM) service (
www.ClicktoPhone.com
) enables
clients to add secure and anonymous voice communication connectivity anywhere
in the world to web sites, web banners, pictures, electronic documents, and
customized e-mail calling buttons. BestNet's communication solutions are now
powered by our new GlobalPlex technology.
For further information please contact BestNet at +1-616-977-9933,
investors@bestnetcom.com
.
Welcome to the new "home" of BESC. Ragingbull was just getting too tedious.
Maddog
Mickey, you saying that Jim is responsible for last weeks "PR"?
Witch, you said "this IHUB board did a major injustice to IDCC and ourselves yesterday. I think this board owes every employee at IDCC an apology."
SAY WHAT?? Maybe the jail time muddled your head.
You must be delusional to think that "this IHUB board" really has that much power.
L2V, aren't revenues tied to WCDMA deployment?
This NOT what the fellas at KOP were alluding to in the not to distant past.
"We do not see W-CDMA as a hockey stick, but as a more graduated and consistent build-out over the next decade
TeeCee, there ya go again my pompous little pal.
You stated to loch:
"the ringleader is a guy named ESPY along w/ marchma..."
Then VG asked you:
"Teecee--are you sure that it is rmarchma and co responsible for the press release? "
Your response:
"thats my speculation..."
Hum, your fallacious "fact," was in reality, ONLY your "speculation".
Talk about spinning the truth.
Please let rmarchma speak for himself.
Maddog
laranger, it's hard to turn the herd in a stampede.
Maddog
TeeCee, as usual, you skirted the question and fired back with one of your self perceived "words of wisdom".
Your penchant for insulting others reveals your true character.
You truly are full of yourself!!
Maddog
TeeCee, you missed his point!! Try reading what he said again:
"I think that if mangement had provided a little clarity regarding the need for these additional options, they would have had the support of the shareholders here (especially in light of recent developments)."
There was NO information on this subject. Where were you yesterday, my caustic friend??
L2V, another saying that comes to mind is "Ignorance is Bliss."
Take off the blinders of naivety, it's a "dog eat dog" world out there.
Maddog
blueskywaves, you said, "Naturally, as a company grows it will have to cater to different types of individual investors and institutional investors." Really? I didn't realize that IDC was in the "catering" to investors business.
This company needs to focus, formulate and execute on a business plan, which stated simply, should be to collect MONEY on their IPR in a timely and non-discounted fashion.
Show investors the money and they will come.
Maddog
walldriver, an interesting excerpt from your post:
"I'm hopeful that FASB will not be detoured because of political pressure this time around. When the grab for shareholder property is front and center for shareholders to see, my guess is that the days of handing out option grants like candy will be a distant memory.
As we used to say, in my days as a CPA, what gets measured, gets controlled."
Maddog
Voted yesterday Jim. Right now 84% of 186 or so shareholders vote NO!!
Maddog
Ranger, I believe that was GOD!!
LOL,
Maddog
Hey Ed, "The pain train is coming!
Whoo Whoo! Whoo Whoo!"
Your way!!!
LOL,
maddog
Tornado, I, like you, would be very pissed at a buyout. At least before IDCC has had a chance to run for a while.
Maddog
mschere, I don't see how it could possibly harm it.
Mickey, heard the same from a broker yesterday. Do you think, like he does, that it will be for a measly $50/share????
Maddog
(NASDAQ:IDCC) InterDigital Communications Corp.
Harry Boxer - TheTechTrader.com (IDCC)
- Mar 18, 2003 04:29 AM (JAGnotes)
- http://finance.lycos.com/home/news/story.asp?story=32449798
===========================================================================
Closing Technical Market Comments Mon Mar 17th 2003 6:00pm ANOTHER MONSTER MOVE By Harry Boxer, The Technical Trader (www.thetechtrader.com) The market had a another monster day today. It started out, however, with a slight gap-down which held support and then they had a very strong rally in the morning that took the indices in a vertical rise straight up from 1020 to about 1075 on the Nasdaq 100 in less than a couple hours, a 55-point rally. The S&P 500 rallied from about 828 to about 858, about 30 points, a very strong morning rally indeed. Mid-day the market went into a sideways, flag, coil-type pattern, and after lunch the market started edging upward, not with the thrust we had in the morning, but the indices did manage to close strong, going away. The Dow was up 282, just a couple points off the high. The S&P 500 closed within pennies of its high, up 29 ?. The Nasdaq Composite was up 51, the Nasdaq 100 up 46, and the SOX Index was up nearly 6%, up 17. It was a phenomenal day today, and the technicals were very positive, nearly 2400 up and only 900 down on New York, 21 to 10 ? on Nasdaq. Up/down volume was the real kicker today: 1.53 billion up and only 118 million down on New York, about 13 to 1, a very strong plurality of volume to the upside. Total volume was about 1 2/3 billion on New York and on Nasdaq was close to 1.8 billion, with 1.647 billion to the upside, and only 146 million down, something on the order of 11 to 1. Very strong day across the board. Reviewing my personal board, some huge gainers today. Among the market leaders, IBM was up 3.46, eBay up 3.09, QLogic 1.47, Qualcomm 1.54. In the lower-priced sector, a monster day today for InterDigital (IDCC), one of my top "Charts of the Week." I recommended to my subscribers over the weekend and it was up 5 3/4 today on 6.3 million shares, with a 3-point breakaway gap on huge news of a settlement with Ericcson and also a restatement upward of earnings. OVTI went to a new 52-week high today, up 1.20 on 3 million shares, continuing its strong thrust of the last couple weeks. The significance of today's move was that after the breakout we had over the last couple days and then the pullback on the Nasdaq 100 to retest support at 1020, the market used that successful retest as a springboard for another monster move up today. With the close being as strong as it was & with Bush speaking tonight we could certainly get some follow-through in the morning. But now we're back up just underneath potentially strong resistance at the January highs near NDX 1100, and even though we're still about 20 points from that, if we get an additional strong move up in the morning the market may be ripe for a significant pullback or at least a more substantial consolidation phase. The S&P 500 had similar action, breaking a triple-top this morning around the 850-52 area, and is now up against the late January highs in the 865-70 zone. That may be more formidable resistance. So we'll see how the market does tomorrow, but can't complain about today. Technically, the market had it all. Good trading! Harry
This may interest some:
Injunctive and Damages Remedies Available in a Patent Infringement Case
(Published in the Patent Law and Litigation Edition, St. Louis Bar Journal, Vol. XLVII, No. 2, Fall 2000)
By Joseph E. Walsh, Jr., Esq. and Mark E. Hoffman, CPA
It can be argued that technology has never been as vital to the success of an enterprise as it is today. Thus, in the current age of sweeping e-commerce, high-tech telecommunications and biotechnology, businesses that neglect to consider a patent1 strategy to protect their important products and methods that distinguish them from their competition are destined to fail.
While vital, however, patents do not assure commercial success and the assertion of patent infringement with a claim for damages carries with it a number of requirements, considerations and proofs peculiar to this form of intellectual property.2 Given the dependence of many businesses upon their patents and the high stakes and large sums of money that frequently attend patent disputes, failure to appreciate certain of the unique concepts embodied in patent infringement remedies law will, similarly, result in failure.
Patent infringement remedies are meted out in the federal district courts because patent rights derive from federal statutes and, thus, give rise to issues of federal question.3 Although patent issues may be appealed as high as the United States Supreme Court, and while Supreme Court precedent certainly governs many of the most import issues affecting patents, the practical court of last resort in patent matters is the Court of Appeals for the Federal Circuit ("CAFC" or "Federal Circuit"). Having limited jurisdiction and specially created in 1982 to, among other things, decide patent appeals, the CAFC has exclusive jurisdiction over all appeals from patent cases in federal district courts.4 Thus, much of the precedent for patent infringement remedies and damages issues is founded upon Federal Circuit authority.
Given the complexity of the subject matter, numerous books, articles and treatises have been written on patent infringement remedies and damages. As such, it is not possible to thoroughly address all aspects of the remedies and damages theories that pertain to patent infringement in the context of this limited space. Rather, the purpose of this article is to lay a groundwork on the subject of patent infringement remedies and damages, introduce the reader to the prevailing theories of legal redress and, at the same time, provide the reader with an appreciation for the complexity of the analysis that typically characterizes a claim for patent infringement damages.
I. Available Remedies
Two basic remedies exist for patent infringement; namely: 1) injunctive relief; and 2) damages.
A. Injunctive Relief
Preliminary and permanent injunctions are provided for under § 283 of the Patent Act.5 Whether a preliminary injunction will issue in a case of patent infringement depends upon four factors; namely: 1) the moving party's reasonable likelihood of success on the merits; 2) the harm the moving party will suffer if preliminary relief is not granted; 3) the balance of the hardships between the moving party and the party to be enjoined; and 4) the impact, if any, on the public interest.6 After infringement of a valid patent claim is found, the claimant is entitled to entry of a permanent injunction against future infringement.7
While an injunction may no doubt be the most valuable remedy sought by a patentee in a case of infringement, the same standards are applied in hearing and granting injunctive relief in patent cases as are applied in other federal cases.8 For this reason, and because many are at least somewhat familiar with these standards, the balance of this article focuses on the lesser known damages component of patent infringement and certain of the unique concepts that distinguish a patent damages claim from other intellectual property damages claims and tort damages claims generally.
B. Damages
Fundamentally, the law that has developed concerning patent infringement damages differs from damages available in other types of intellectual property infringement in that it has not embraced the concept of "disgorging" an infringer's profits. Thus, in cases of patent infringement, the infringer's profits are not recoverable.9 Nevertheless, and despite this undisturbed precedent, the Federal Circuit has, in certain cases, allowed the infringer's profits to serve as a measure of the patentee's lost profits.10
The patentee's lost profits are one recognized form of compensable damages for patent infringement. The other recognized measure of a patentee's damages for patent infringement is a reasonable royalty. These damage theories are discussed separately below and the measure of the patentee's recovery under both of these damage theories is governed by 35 U.S.C. § 284 which provides that "upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use of the invention by the infringer, together with interest and costs as fixed by the court." The amount of damages is a question of fact11 and patent infringement damages cannot be speculative, but need not be proven with absolute precision.12
1. Lost Profits
The patent owner's actual losses, measured as the loss of profits, is one possible measure of "damages adequate to compensate for the infringement." Proof of lost profits must include two elements: (1) a showing of causation, i.e. that the patent owner would have made additional sales "but-for" the infringement, and (2) evidence for the computation of the loss of profits.13 Lost profits damages may be measured based upon the causation factors set forth in Panduit Corp. v. Stahlin Bros. Fibre Works, Inc.14 Under the Panduit test, the patentee must prove four factors to establish lost profits. The four factors are: (1) a demand for the products covered by the patent; (2) an absence of acceptable non-infringing substitutes to the patented product or process; (3) that the patentee possessed the manufacturing and marketing capabilities to exploit the demand; and (4) the amount of profit the patentee would have made had the infringement not occurred.
Special Note: In the twenty years since Panduit, many of the cases have turned on the application of factor (2) requiring the patentee to prove an absence of acceptable non-infringing substitutes to the patented product or process. In many of those cases, it has been held that "t is not [emphasis added] necessary for the patent holder to negate all possibilities that a purchaser might have bought a different product or might have foregone the purchase altogether."15
However, in Grain Processing v. American Maize-Products16 -- a case decided last summer by the Federal Circuit, the court upheld the district court's decision denying lost profit damages to Grain Products Corporation ("GPC") on the basis of a non-infringing alternative product made by a method American Maize-Products ("AMP") first introduced in the last year of the term of GPC's patent despite the fact of infringement years earlier. Thus, "with proper economic proof of availability [emphasis added], as American Maize provided the district court in this case, an acceptable substitute not on the market during the infringement may nonetheless become part of the lost profits calculus and therefore limit or preclude those damages."17 Thus, there is now precedent for the proposition that an accurate reconstruction of the hypothetical "but for" market takes into account any alternatives available to the infringer not just those that were actually produced and sold during the infringement.
When more than two suppliers exist in the relevant product market, the Federal Circuit held in State Industries, Inc. v. Mor-Flo Industries, Inc. that a patent owner may satisfy the second Panduit element by substituting proof of its market share for proof of the absence of acceptable non-infringing substitutes.18 Under this "market share" approach, the patentee substitutes proof of its market share for proof of the absence of acceptable non-infringing substitutes, calculating damages based upon its market share.
2. Reasonable Royalty
When actual damages cannot be proved, or are not sought for reasons of proof, trial strategy or otherwise, the patent owner is entitled to not less than a reasonable royalty as damages. The usual assignment for an expert witness is to indicate what would be a reasonable royalty between the parties, taking the judicially and commercially relevant circumstances into account. Since the statute provides that damages will not be less than a reasonable royalty, this level is the judicially acceptable minimum for damages. The "purpose of the royalty alternative is not to direct the form of compensation, but to set a floor below which damage awards may not fall."19
Authoritative guidelines for interpreting and applying Section 284 were provided by the first Chief Judge of the Federal Circuit Howard Markey, in Fromson v. Western Litho and Supply Co.20 Judge Markey's comments in the case opinion expressed his views in connection with the statutory language "damages adequate to compensate for the infringement" and in any event "not less than a reasonable royalty." His comments included:
As used in Section 284 'reasonable royalty' is handy shorthand for damages. As the statute provides, the royalty is 'for the use of the invention by the infringer.' Thus the calculation is not a mere academic exercise in setting some percentage figure as a 'royalty.' The determination remains one of damages to the injured party.
Reasonable royalty was defined in Panduit Corp. v. Stahlin Bros. Fibre Works as "an amount which a person desiring to manufacture and sell a patented article, as a business proposition, would be willing to pay as a royalty and yet be able to make and sell the patented article in the market at a reasonable profit.21 The determination of a reasonable royalty between the patentee and a would-be licensor in the absence of an arms-length agreement is a matter of much dispute. Reasonable royalty may be based upon an established royalty, or if an established royalty does not exist, reasonable royalty may be determined based upon a hypothetical negotiation between a willing licensor and willing licensee.22
An established royalty has been defined as a royalty "paid by such a number of persons as to indicate a general acquiescence in its reasonableness by those who have occasion to use the invention."23 This definition indicates that more than a single license agreement is generally required to demonstrate uniformity among multiple licensees. General acquiescence also implies a willing licensor and licensee, rather than a mere offer to licensee. Offers to license may be in the form of a "carrot" or a "stick" license. Offers to license after infringement began and under the threat of litigation (stick license) "should not be considered evidence of an 'established royalty,'" because "license fees negotiated in the face of a threat of high litigation costs 'may be strongly influenced by the desire to avoid full litigation....'"24 An established royalty may be a strong indicator of the amount of reasonable royalty. "Where an established royalty rate for the patented inventions is shown to exist, the rate will usually be adopted as the best measure of reasonable and entire compensation."25
Absent an established royalty for the infringing conduct, a reasonable royalty may be determined after infringement based upon a hypothetical negotiation.26 The landmark Georgia-Pacific Corp. v. U.S. Plywood-Champion Papers case listed 15 factors representing the guidelines provided by the court for determining what would be a reasonable royalty based upon a hypothetical negotiation following a finding of patent infringement in that case.27 The broadest of these factors is the 15th Georgia-Pacific factor, which is the overall hypothetical negotiation embodying the first thirteen factors:
The amount that a licensor (such as the patentee) and a licensee (such as the infringer) would have agreed upon at the time the infringement began if both had been reasonably and voluntarily trying to reach an agreement; that is, the amount which a prudent licensee who desires, as a business proposition, to obtain a license to manufacture and sell a particular article embodying the patented invention would have been willing to pay as a royalty and yet be able to make a reasonable profit and which amount would have been acceptable by a prudent patentee who was willing to grant a license.
The principle articulated in the 15th Georgia-Pacific factor hypothecates the parties entering into a fictitiously agreed upon license on the date of first infringement. The court in Panduit commented on this hypothetical negotiation, explaining that:
Determination of a 'reasonable royalty' after infringement, like many devices in the law, rests on a legal fiction. Created in an effort to 'compensate' when profits are not provable, the 'reasonable royalty' device conjures a 'willing' licensor and licensee, who like Ghosts of Christmas Past are seen dimly as 'negotiating' a 'license.' There is, of course, no actual willingness on either side and no license to do anything, the infringer being normally enjoined...from further manufacture, use, or sale of the patented product. 28
The court also recognized that a reasonable royalty, as damages for infringement, might be treated differently than the royalty that would result from a hypothetical negotiation between a willing licensor and willing licensee. In this regard, the court observed that:
The setting of a reasonable royalty after infringement cannot be treated ... as the equivalent of ordinary royalty negotiations among truly 'willing' patent owners and licensees. That view would constitute a pretense that the infringement never happened. It would also make an election to infringe a handy means for competitors to impose a 'compulsory license' policy upon every patent owner. 29
Increasing the royalty to compensate the plaintiff for the trouble of obtaining a royalty through litigation has became known as a Panduit "kicker." The Federal Circuit rejected a trial court's award of a kicker, observing that such a kicker is not compensatory.30 However, shortly thereafter, a different Federal Circuit panel affirmed an award of damages that exceeded the reasonable royalty. The court stated in part that "the fact that an infringer had to be ordered by a court to pay damages, rather than agreeing to a reasonable royalty, is also relevant."31
The 14th Georgia-Pacific factor is "the opinion of qualified experts." This factor mirrors the 35 U.S.C. § 284 statutory provision that "the court may receive expert testimony as an aid to the determination of damages or what royalty would be reasonable under the circumstances." Id. The remaining 13 Georgia-Pacific factors that a damages expert may consider in formulating his opinions as to the amount of reasonable royalty damages are:
1) The royalties received by the patentee for the licensing of the patent in suit, proving or tending to prove an established royalty.
2) The rates paid by the licensee for the use of other patents comparable to the patent in suit.
3) The nature and scope of the license, as exclusive or non-exclusive; or as restricted or non-restricted in terms of territory or with respect to whom the manufactured product may be sold.
4) The licensor's established policy and marketing program to maintain his patent monopoly by not licensing others to use the invention or by granting licenses under special conditions designed to preserve that monopoly.
5) The commercial relationship between the licensor and the licensee, such as, whether they are competitors in the same territory in the same line of business; or whether they are inventor and promoter.
6) The effect of selling the patented specialty in promoting sales of other products of the licensee; the existing value of the invention to the licensor as a generator of sales of his non-patented items; and the extent of such derivative or convoyed sales.
7) The duration of the patent and the term of the license.
8) The established profitability of the product made under the patent; its commercial success; and its current popularity.
9) The utility and advantage of the patent property over the old modes or devices, if any, that had been used for working out similar results.
10) The nature of the patented invention; the character of the commercial embodiment of it as owned and produced by the licensor; and the benefits to those who have used the invention.
11) The extent to which the infringer has made use of the invention; and any evidence probative of the value of that use.
12) The portion of the profit or selling price that may be customary in the particular business to allow for the use of the invention or analogous inventions.
13) The portion or the realizable profit that should be credited to the invention as distinguished from non-patented elements, the manufacturing process, business risks, or significant features or improvements added by the infringer.
The Georgia-Pacific factors are not considered exhaustive or the only approach to determining what constitutes a reasonable royalty in all cases. While the Georgia-Pacific factors represent an earnest effort by the court to provide guidelines for determining a reasonable royalty following a finding of patent infringement in that case, many other factors may also influence licensing royalties in other circumstances. "The amount of a reasonable royalty after infringement turns on the facts of each case, as best they may be determined."32
The Georgia-Pacific case dates back to 1970. The more recent 1992, Honeywell v. Minolta case included jury instructions listing a modified version of royalty factors representing guidelines for determining reasonable royalty.33 The three reasonable royalty determination factors that were added in the Honeywell case are: (1) the relative bargaining positions of the parties, (2) the extent to which the infringement prevented Honeywell from using or selling the invention, and (3) the market to be tapped. Honeywell appears to place more emphasis on an analytical determination of profits, changing Georgia-Pacific factor 12 to read "what the parties reasonably anticipated would be their profits or losses as a result of entering into a license agreement."
3. Supplemental Damage Theories
When considering lost profits or reasonable royalty measures of patent infringement damages, courts have recognized that "the economic value of a patent may be greater than the value of the sales of the patented part alone." Under this rule, courts have allowed recovery of lost profits or a reasonable royalty based not only on the profit from the patented part, but also on non-patented parts.34 This concept is referred to as the "Entire Market Value Rule." In order to fully compensate a patentee for his loss due to infringement, a number of supplemental damage theories have emerged under the Entire Market Value Rule. Recognized examples of supplemental damage theory claims include: i) price erosion; ii) convoyed sales; and iii); accelerated market entry damages. These supplemental theories are discussed below.
(i) Price Erosion
This supplemental theory recognizes lost profit damages due to price reductions or other discounts the patentee had to make in order meet competition created by the infringer35 or the mere existence of the infringer in the market.36 Price erosion damages are usually determined by comparing the sales price of the patented product prior to infringement to the sale price of the same product during infringement.37 Price erosion damages have also been awarded upon a showing that patentee would have raised prices but-for infringer's presence in the market.38
(ii) Lost Profits on Sales of Unpatented Items
Items sold as a consequence of sales of the patented product are often referred to as "collateral" or "convoyed" sales. When unpatented items normally sold with or as a result of the sale of patented items, recovery of damages may be awarded if the patent related feature of the item (which also contains unpatented features) is the basis for customer demand.39 In the landmark case of Rite-Hite Corp. v. Kelley Co., the Federal Circuit established, however, that damages are recoverable under this theory only if the patented and unpatented components together are "analogous to components of a single assembly . . . parts of a complete machine or constitute a functional unit but not where the unpatented components have essentially no functional relationship to the patented invention and . . . may have been sold with an infringing device only as a matter of convenience or business advantage."40
(iii) Accelerated Market Entry Damages
Accelerated market entry damages (sometimes referred to as "accelerated re-entry damages") may be applicable when an infringed patent is close to expiration or has expired. These damages measure and compensate the patentee for his future loss of profits caused by the patent infringement. The infringement causes the patentee to experience reduced sales and profits in the future as a result of the head start that the infringer will enjoy after the patent monopoly expires. The theoretical premise behind this element of damage is that the infringer impermissibly obtained market share before the patent monopoly expired, thus giving him an unlawful competitive head start prior to the expiration of the patent. The infringer thereby starts from an established customer base, rather than starting at zero where he otherwise would have started had the infringement not occurred.
II. Enhanced Damages
The Patent Statute also allows a court to increase the patentee's damages by up to three times the amount determined as actual damages.41 While the statute does not prescribe the standards for determining the appropriateness of an increased damage award, the courts generally consider the following nine factors: 1) whether there was deliberate infringement; 2) whether the infringer, when on notice of the patent, took reasonable steps to investigate the scope of the patent and formed a good faith belief that it was invalid or that it was not infringed; 3) the infringer's behavior as a party to the litigation; 4) the infringer's size and financial condition; 5) the closeness of the case ; 6) the duration of the infringer's misconduct; 7) the remedial action taken by the infringer; 8) the infringer's motivation for the harm; and 9) the infringer's attempts to conceal its infringement.42
III. Prejudgment Interest
Under 35 U.S.C. § 284 prejudgment interest on damages is recoverable. Prejudgment interest should be awarded in most patent infringement cases because prejudgement interest is necessary to fully compensate the patentee.43
IV. Attorneys' Fees
The court in "exceptional" cases may award reasonable attorneys' fees to the prevailing party.44 Requests for attorneys' fees usually arise after a finding of willful infringement and factors concerning the parties' conduct both during the infringement and trial often dictate whether attorneys' fees are awarded. A district court's decision to award attorneys' fees involves: 1) a factual finding that the case is "exceptional;" and 2) a determination that an award of attorneys' fees is appropriate, a determination that is reviewed for an abuse of discretion.45
V. Conclusion
Remedies for patent infringement in the United States include injunctive relief (both preliminary and permanent) and damages. Damages can be proven either by establishing a patentee's lost profits or by resort to a hypothetical market analysis of the patented device wherefrom a reasonable royalty can be determined.
Under a principle known as the "Entire Market Value Rule," several supplemental damages theories exist which are designed to compensate the patentee for the total harm done by virtue of the infringement. To recover under any of the supplemental damages theories, however, the claimed damages must not be speculative. Thus, in addition to recovering actual damages based upon the fact of infringement, a patentee may, for example, also recover damages for the erosion in price that has occurred to his product, his lost profits on unpatented products or components sold in conjunction with the patented product and based on the competitive advantage gained by the infringer in developing market share prior to the expiration of the patent.
Enhanced damages are statutorily provided (up to three times proven actual damages) and, within the discretion of the court, are awarded to a patentee based upon a number of factors used to gauge the egregiousness of the infringement. Attorney's fees and costs can also be recovered in "exceptional cases" where the conduct of the infringer so warrants.
Maddog
Art, just to be fair to DD, if you read his post, you would have had your questions answered:
"IMHO stock options are an experiment gone bad due to greed. Obviously IDCC management is not the only company to succum to this greed but to me it is the only one that matters due to the huge investment I have in it. Hopefully your post opens some eyes and minds to the true cost of this no cost compensation."
MD