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We all knew (or should have known) that WDDD was a lottery ticket, binary event stock. Unfortunately the lottery ticket was not a winner. It sucks, but it is what it is.
I can (kind of) understand not selling existing holdings at this point, but I don't understand adding here. The market cap is below $1 million, and it's a one person company. If you're looking for something not related to IP enforcement, invest in something else. There are lots of small tech companies out there. The only hope for WDDD is some miracle to make the patents relevant again.
Of course there is a "Plan B." As long as there is money to pay the lawyers and the CEO's salary, WDDD will keep trying to appeal and drag this out as long as possible. After today, though, the inevitable end result seems very clear.
Volume today was higher than the big dump on Monday. I've never seen WDDD hit 3,000,000 in volume. I hate to use this phrase, but "somebody knows something." I have to believe the volume was driven by more than just WDDD appealing the decision. Obviously that was going to happen.
I still remember wondering why on earth would WDDD file claims against MSFT before the trial with ATVI was set. Why bring in another heavy hitter that will obviously use its influence to derail proceedings?
At the time, I just assumed that WDDD knew something I didn't.
Apparently not.
True, but this would be one less possible issue. And it’s a big one.
Again, this is all very hypothetical, but having the patents validity challenged on the 101 issue at the CAFC seemed like an inevitability. It just would have been nice to have WDDD be in a better financial position when that day came.
I'm not saying ATVI could not appeal the result of the case if it somehow makes it back to trial. I'm saying that the 101 is probably the most obvious way of appealing a patent's validity. If the CAFC upholds the patents as valid this time around, there's a lot less available for ATVI to hypothetically appeal if they end up going to trial and losing.
I'm not trying to spin this event as positive. Obviously it's not. But if WDDD is somehow able to successfully appeal this latest decision, they would be in a better position overall come trial (all things being equal).
There is one bright side here. If, by some miracle, WDDD manages to get a favorable ruling at the CAFC and eventually make it to trial, it's less likely that ATVI would be able to successfully appeal the actual trial, since a positive result from this upcoming trip to the CAFC would in theory validate the patents.
Obviously we would all rather this have gone a bit differently, but one way or another, it feels like this was always destined for the CAFC. It was just a matter of who was going to file an appeal, and under what circumstances.
Long time holder, first time (in a while) poster.
Anyway, unless there has been some update that we are not yet unaware of, filing against Microsoft seems questionable. What if Microsoft decides to challenge the same patents currently being used against ATVI? Microsoft is not time-barred. Another challenge would put the current trial on hold (again) for at least another 12-18 months. I have to believe WDDD is smart enough to see that. To me the bigger news today is not the new lawsuit itself, but the reasoning behind the decision to file now.
Whatever that reasoning is, good or bad, I'm sure we'll find out something more substantial within the next few weeks.
I will probably add more as we go as well, but there's no hurry. We probably have 6+ months of a slow price decay before the CAFC.
Ideally it drops into the $0.01/share range where we can all load up.
They exposed WDDD to additional expenses and firm of less experience for the initial PTAB. Why would this be any different?
I'm asking because I truly don't know :)
We need a PR clarifying how this appeal is going to be funded. Right now, based on history, people are afraid of more dilution.
Agreed. When we get a positive CAFC verdict, the stock will rise. In the next few months before the verdict, it won't.
Oh I agree that Worlds has the advantage. And I think ultimately they will at the very least break even. But still, the stock price probably is going to slowly fade until we get close to a decision on the appeals.
"The parties hereby file this joint report regarding the status of the inter partes review ("IPR") proceedings between Worlds and Bungie, Inc. (the "IPR Petitioner"), and jointly move the Court to continue the stay of all proceedings in this case until the conclusion of any appeals to the Federal Circuit of the PTAB's six IPR decisions."
Presumably, Bungie will also be appealing all of the claims Worlds won. This means you won't see the stock price going up for a while. On the plus side, plenty more time to accumulate shares.
That's a good point. For monetary reasons, I hope they wait to appeal. I don't need them going through appeals and diluting more of my shares before earning anything from the current case.
It does seem like your interpretation is correct. And now that I go back and look at the last PR, Kidrin never actually said anything about appealing the decisions.
"However we believe that a number of the disallowed claims should have been ruled in our favor. After we receive all the rulings, we will assess our position and options with legal counsel and determine the best strategy regarding future litigation and alliances with strategic partners that will maximize potential of our intellectual property."
The first time I read that, I assumed it meant they were going to appeal the disallowed claims. But now that I look at it more closely, I guess not.
Wait when did the '501 news get released...?
I'll be the first to celebrate if I'm wrong :)
And for the record, I think if all goes well this stock will easily break $1.00/share in the long term.
Don't get me wrong, I am long on this stock. I'm just trying to stay grounded after the recent news. Still a long road ahead.
I hope it does, but I'll be shocked if this doubles to $0.10-0.12 in the next few weeks (and also stays there) as a lot of people are implying it will.
I agree that the patents are important. But there are lots of important aspects to developing these games, even beyond just the technological aspects. Our piece is just one. The question remains, how big is that piece?
My main point is that there is still uncertainty around this stock. Will we even make it past the next set of appeals? Logic says yes, but the history of patents reviewed by the CAFC throws logic out the window.
And if we manage to make it to trial, how much are these patents even worth? Will we win that trial? If we do, how likely is it that the CAFC would uphold a large monetary decision by the appeal that would presumably follow the trial?
High risk, high reward. To put my thought process simply, I realize there are a lot of people in the market who do understand these patents and this process much better than I do. And those people are pricing the current share price at $0.06/share. There is a reason for that.
While these 6+ patents surviving is certainly good news, it does seem like a few people here are dramatically overreacting to the news.
Yes, this stock does have a lot of potential. That's why we're here. But is it currently undervalued 500-1000% as some of you are suggesting, saying that it should be priced at $0.25-0.50 per share? Definitely not. The market is not that ignorant. If it was worth that much, it would be priced accordingly.
There are still a lot of hurdles ahead. These recent decisions can be appealed by both parties. If that goes well, there is a trial. If that goes well, there is an appeal on that trial. The process could take years. Obviously a settlement would change that, but a settlement is not likely at this point in the game. Certainly not before the next round of appeals. And even if there was a settlement now, it would be severely discounted because WDDD has yet to make it through many major steps.
Additionally, does anyone here really have an accurate estimate on how much these patents are worth? Yes, a lot of money has been made by Activision, and others, using this technology. But is WDDD really entitled to hundreds of millions of dollars from Activision? It's possible, yes. But many people here seem to state as a verified fact that these patents are worth billions of dollars when viewed as a whole across the industry. Is there any ACTUAL justification for that, or just speculation?
I'm not trying to s*** on the recent news, but let's not go overboard.
How did any of you think FH was going to acquire XpressSpa? They're going to have to pay with something.
It is somewhat unsettling, though not surprising, that essentially shareholders are paying for the XpressSpa acquisition through more dilution, instead of FH using the cash they have.
I still think we are missing a major piece of the puzzle with regards to the ZTE settlement. VRNG made some decisions in the last few months of 2015 that have not been adequately explained. But whether or not we will find out about it this quarter or next (or ever), remains to be seen.
Do we know when the next Earnings Report is going to be? Unless there are some surprises in that, it seems like there is little reason to stick around in the short term now that DTV is likely to drag on.
Sadly, it might be time to cut those losses and move on. This stock bleeds every day.
I'm inclined to agree with this assessment from Flounder:
"This is NOT an On- the job- training position! These guys are SUPPOSED to be professionals."
While I don't blame management for getting screwed on the Google case, I do blame management for not having some kind of viable backup plan. We all knew that such a lengthy appeals process might go in favor of an enormous corporation like Google.
ZTE was supposed to be a backup plan, and yet everyone blames that disappointment on the Google loss. If ZTE was contingent on a Google win, then it's the opposite of a backup plan, and management should be held accountable for that failure.
Yeah how dare anyone blame the CEO of a company that spent 4 years pursuing global litigation against ZTE only to settle for absolutely no profit?!?!?! All the while, shares lost more than 90% of their value and management saw their salaries INCREASE.
How could anyone blame a CEO for that??
I have a (wishful) theory on Vringo based on two major questions that I think most of us have:
1) Why did Vringo settle with ZTE for so much less money than everyone had anticipated?
2) Why did Vringo buy Fli Charge?
I still don’t think we have gotten satisfactory answers to either question, and honestly I think we should be pushing a little harder for them.
We all did enough DD to know how much more money should have been at stake with ZTE, so I won’t get into all the details of the global litigation. The only explanation given to us with regards to why the settlement was so low was a vague statement about how Vringo was too low on cash to continue. But were they? We all saw the quarterly reports. They had enough cash to continue for another year. That and management seemed to have no qualms about diluting shareholders in order to generate cash (although that's hardly a good thing). More importantly, why did Vringo buy FliCharge if they were so low on cash???
As much as we all dislike Vringo Management right now, I don’t think they’re legitimately stupid. I think that every action has a motivation. I find it hard to believe that Vringo would waste money buying FliCharge in Oct 2015 solely to “diversify”, only to then say that they essentially have to give up on ZTE less than 2 months later due to lack of funds.
Instead, MAYBE someone at Vringo is actually smart. Maybe somebody realized that attempting to shake down ZTE purely for a cash settlement was going to be unnecessarily difficult. A settlement is meant to be a win-win for both sides. For BOTH sides, it’s meant to be a better alternative than continuing to fight in the courts. What would be a better alternative? Instead of trying to force ZTE to simply fork over millions in fines, allow them to get something in return. If ZTE agrees to implement a new technology directly into their phones as part of the settlement, it can be seen as an investment for them.
So, Vringo buys up a small wireless conductive charging company. The big drawback to conductive charging for phones is that it has to be separately built in, either via a case or by an OEM (like ZTE). Once that is done, though, it is more efficient than the alternative inductive charging. If Vringo can get ZTE to implement this new technology, then Vringo makes money by licensing the wireless charging technology and ZTE gets to invest in implementing a more efficient technology directly into their phones. A win-win. A perfect way for ZTE to save face, as was clearly a high priority for them throughout all the litigation.
While this is just a THEORY, I think it explains a lot of recent events without making too many outlandish assumptions. The main assumption is just that Vringo has some logical motivation behind 2 major decisions. It also explains the confusing PR that was released about the settlement which states a confidential agreement was reached, and then immediately seems to state how much the settlement was worth and how/when it will be paid. And it explains why Cliff (President of FliCharge) has been doing a fair amount of insider buys.
Now I’m certainly not saying anyone should start buying up shares purely on speculation, but I think it is reason enough to Hold for a little while longer until we get some actual closure on the ZTE settlement.
Thoughts?
It was not a "pie-in-sky" prediction to think that V was going to make SOME money with a settlement. They spent 4 years litigating worldwide, and for what? This settlement money barely covers the corresponding legal costs. So V spent 4 years to break even on ZTE, all while the share price was left tumbling. I agree that expecting $1B was ridiculous, but $100M was not. It's certainly reasonable to expect at least some kind of profitable return, especially with how many things seemed to be going V's way, including the NDA.
And ZTE themselves claimed to be losing more than $21.5M just due to injunctions in Romania and Brazil. ZTE launched a campaign to slander V and even had the NDRC threaten V in order to attempt to negotiate a lower settlement amount. Why would ZTE care so much over what turned out to be so little?
So based on the combined actions of V and ZTE, it was very "coherent" to infer that a settlement in V's favor would be for a somewhat meaningful amount of money.
V clearly dropped the ball, and although some people may have had lofty expectations, this result is beyond a disappointment even to the most conservative estimates.
While I'm certainly not an expert on the topic, for me the PR seems to indicate additional payments beyond the $21.5 million.
My takeaway is that the licensing/royalty itself agreement is confidential, meaning we are not going to be told how much the patents were negotiated for. We will only see the income results over the upcoming Quarterly Reports. Why state something as confidential, and then reveal the corresponding amount in the very next paragraph?
The $21.5 seems to be an initial payment, i.e. reimbursement for legal fees, etc. It's no coincidence that the value is just below the threshold for which V has to start paying Nokia their 35% cut. After this initial payment, 35% of the additional license/royalty fees will be given to Nokia.
That and just plain logic seems to indicate the total amount should be higher. Why would ZTE be so concerned and launch such a vast campaign to slander V's name over such a small amount? Why would V spend so much time chasing what is essentially no net gain (after legal costs)? We all read the public Pacers from SDNY. It was certainly looking (very) favorable for V, and that case alone was worth more than $21.5 million.
That's just my impression, though. Only time will tell. For now I'll be holding and watching for developments, which sadly may not be until the next few Earnings Reports.
I know ZTE is trying to stall. That much is obvious. The question is are they really going to be granted a retrial based on something that they themselves are requesting. Seems unlikely.
I don't think ZTE can request that Kaplan determine damages in place of a jury, and then later try to request a retrial for that very reason.