http://treowth.blogspot.com/2008/09/harold-hughes-he-can-taste-vindication.html

Thursday, September 11, 2008

Harold Hughes, he can taste vindication?

Disclosure: I have been very disappointed with Rambus Inc. Conference Calls for eons. If you have read Treowth for a few quarters, you know this.

Further Disclosure: I have never been treated for what family and friends feel is delusional behavior - my belief that in the end, Rambus will prove to have been an investment of pure genius.

I am incurable . . . that noted, last evening I listened to the Webcast of Harold Hughes, CEO & President of Rambus Inc. at the Citi Technology Conference, Hilton New York Hotel held on September 4, 2008.

First the negative:
It simply kills me how many times Mr. Hughes clears his throat. Respectfully, I suggest using a microphone with a switch that he can use to turn off the sound - clear his throat - turn on the sound.

Now the good stuff:
1) Mr. Hughes was full of piss and vinegar.
2) Mr. Hughes was cocky.
3) Mr. Hughes was full of piss and vinegar. Oh, I noted that already. Well it is worth mentioning twice.
4) I am convinced that Mr. Hughes will NOT settle for less than 4.25% on US sales of DRAM, in fact, I'd bet 4.25% is the bottom rung for World Wide sales. (Nope, not seeking treatment next week. I am not.)
5) Mr. Hughes is prepared to take the cartel litigation to and through the Gates of Hell if necessary.
6) The law firms are paid up front - no contingency fees. Bonus dough is discretionary with Rambus.

Notable quotes - paraphrases as I remember them:
1) Next February, March is going to be very interesting.
2) I am not passive. Spending $45 million on lawyers a year isn't passive in my book.
3) I am not going to forget laying off 90 employees anytime soon.
4) See the ball. Hit the ball. I believe referring to how the lawyers are paid. I've never heard it expressed in that fashion before.

Listen for yourself here. There is a presentation, which for some reason starts 7-8 minutes into the clock and there is a separate breakout session - Q & A for us regular folks. I had to manually advance the slides during the presentation and they are a bit small.

Posted by Any Donkey at 8:42 PM 0 comments

Labels: Harold Hughes, Rambus Inc., RMBS

Integralaction - Thanks. Big graphs gone.

Board suggestion - move charts below posts.

It is inconvenient to scroll through the charts, etc. I would appreciate seeing the charts below the posts.

OT - Facebook liability to your career?

While we wait for something meaningful to happen regarding Rambus - other than the share price dropping, I came across negative commentary regarding Facebook. The comments following the post are interesting.

Any thoughts from the Rambus faithful?

Should you be using Facebook to shmooze online? If you’re in management or above, perhaps you should think twice before participating.

http://blogs.bnet.com/teamwork/?p=387&tag=nl.rSINGLE

Rambus Inc., explains second round of RSUs

After allowing shareholders to fume overnight, Rambus Inc. explained why it awarded certain Section 16 officers and other executives a second round of restricted stock units in 2008 - "to retain certain key talent, stabilize the workforce post-restructuring, and incentivize both short and long-term commitment of the workforce to the company."

Cash bonus payments in 12 and 24 months will be made to about 23 percent of the worldwide workforce that remain with the company in good standing. Restricted stock units will be distributed to approximately 8% of the worldwide workforce.

Donkey Note:
It costs to retain the best and the brightest - hopefully, those are indeed the employees that remain . . .

http://treowth.blogspot.com/2008/09/rambus-inc-explains-second-round-of.html

IV Board is very very slow. EOM

Judge Whyte denied the cartel a new trial.

http://www.scribd.com/doc/4081477/Hynx-v-RMBS

PricewaterhouseCoopers LLP (PwC) wants to be dismissed as a defendant in the amended complaint of the Rambus Inc. securities litigation. The PwC motion includes such gems as:

Statute of limitations - plaintiffs are too slow in asking the court for relief. This is the escape hatch that may used by a bad actor who is clever or fortunate enough to have bad behavior remain undiscovered long enough so as to escape justice in this dimension. High fives all around the office and the E & O carrier sighs in relief.

Failure to allege sufficient facts - establishing a strong inference of fraudulent scienter (mental state characterized by an intent to deceive, manipulate, or defraud) by PwC. It is not enough to allege that PwC failed to notice and report the backdating of the options. Mere incompetence (if present) is not the same a fraudulent scienter. Ramboids, if you think the auditor was incompetent, check the appropriate box before mailing in your proxy.

PwC statements are primarily statements of opinions not statements of fact. This is exactly what the average investor thinks about an auditor's opinion- that it is an opinion that is not worth the paper it is written on . . . certified public accountants wonder why few tears are shed when their firms are hit with lawsuits.

There's more, like the allegation PwC makes that the Lead Plaintiff wasn't harmed . . . "mean trading price of Rambus stock in the statutory bounce-back period following the alleged corrective disclosures was greater than the price at which the Lead Plaintiff purchased his stock." (Page 19, beginning at line 5)

Maybe Rambus Inc. should backdate another $200 million worth of options if it makes the price of the stock climb . . . .

http://treowth.blogspot.com/2007/05/pricewaterhousecooper-llp-legally-of.html

The DRAM price-fixing conspiracy resulted in four Hynix Semiconductor executives doing time in a United States prison. Three are currently incarcerated and a fourth has served and been released. Each of the four agreed to pay a $250,000 criminal fine. Hynix agreed to pay a $185,000,000 criminal fine.

Pictured: Dae Soo Kim, Executive Vice President, Head of Sales & Marketing Division. Projected Release 12/14/07

Chae Kyun Chung. Projected Release 5/14/07

Kun Chul Suh. Projected Release 8/6/07

Choon Yub Choi. Released 10/30/06

http://treowth.blogspot.com/2007/04/hynix-semiconductor-executives-doing.html

Rambus Inc. has stock ownership guidelines for its officer & directors, ranging from 2-5 times annual base salary.

"This is an important means by which to align the interests of Rambus' executive officers and independent directors with the long-term interests of Rambus' shareholders."

Adopted in October 2006.

http://treowth.blogspot.com/2007/04/rambus-inc-officer-director-equity.html

A Ramboid sent me picture of his vehicle with the license plate "Rambus 1". One thing for certain, Rambus Inc. has some very devoted shareholders.

Link to photograph.

http://treowth.blogspot.com/2007/04/true-ramboid.html

48 jobs openings at Rambus Inc. Six in marketing and two in sales.

Find job at Rambus Inc., benefits, generous stock options (sorry, no more backdating), lots of fun including annual pizza and shred party and occasional scavenger hunt hosted at randomly chosen garage. All the Coke you can drink while on the job. Work for the Great Communicator, Harold Hughes.

http://treowth.blogspot.com/2007/04/rambus-inc-help-wanted.html

In the year 2525 . . .

Finz's Rambus Inc. Song of the Day. He predicts that will be the year celebrating the 100 year anniversary of the final backdating report. At the current rate, the slow hands may still be "working". Fortunately, the class action litigation will force Rambus to finish the job at some point . . .

Say it ain't so!

<if RMBS management and BOD treats and reacts the same to the MMs as it does to its shareholders, blame can be attached equally>

Hey, I thought I told you to stop complaining and go buy Coke?
-HH, RMBS CEO

U.S. District Court Judge Ronald Whyte was struck by a light rail train at approximately 1 p.m. near the intersection of Second and San Fernando streets.
The judge was not seriously injured in the accident, according to Santa Clara Valley Transportation Authority spokeswoman Jayme Kunz.

Reportedly, Judge Whyte will return to work on Tuesday and dispense justice without delay . . . Ramboids can only hope.

http://treowth.blogspot.com/2007/02/judge-whyte-struck-by-light-rail-train.html

Missed your perspective on things and your Song of the Day

Thank you, Treowth belongs to the Ramboids and has contributors other than myself. Song of the Day is FinzToRite's baby and now exceeds 300 tunes. Strict rules apply to its selection, but every blue moon or so, Finz has consented to a bonus song suggested by a reader.

Treowth live again.

For the three that care, treowth is live again. The short version - Google robots locked treowth 1/13/07 prohibiting posting as part of their efforts to remove spam blogs. Ten days later, a Google human (is there such a species?) reviewed treowth, apologized and unlocked treowth. I will review the posts I drafted during the involuntary hiatus and bring them live over the next day or so and resume regular posting.

Mr. Tate walked away from $25 million pre-tax. One has to wonder what Rambus Inc. asked Tate to do that he did not do, allowing the $25 million of options to expire on the table.

http://treowth.blogspot.com/2007/01/former-rambus-inc-ceo-options.html

Samsung disposition here

http://appellatecases.courtinfo.ca.gov/search/case/disposition.cfm?dist=1&doc_id=65109&doc_n...

The local (Folsom, CA) Best Buy had 3-5 the day before Christmas for a few minutes. In jest I asked an employee if I could purchase a PS3. With a straight face he told me that 1/2 hour before I could have. He told me the policy was to simply unpack them and quietly stick 'em the "cage" - a locked rolling rack near the front of the store. If a customer asks at the right moment . . . there was and remains a severe shortage in Folsom.

Despite the extremely low royalty rate that Infineon pays, I have been a believer that settling with Infineon was the right move. Judge Whyte re-affirmed my belief this week when he declined to certify.

http://treowth.blogspot.com/2006/12/no-hynix-v-rambus-interlocutory-appeal.html

Does your broker pay you?

Over the years posters have complained that brokerage firms have been lending out our Rambus shares to our determent. The 12/11/06 edition of Forbes spills the beans about brokerage firms lending shares to hedge funds.

Forbes also reports that two brokerage firms share revenue (pay) customers for the privilege of lending out their shares. The two firms are Smith Barney and Charles Schwab.

Does anybody have experience with revenue sharing with one of these firms or others?

http://treowth.blogspot.com/2006/11/does-your-broker-pay-you.html

Mercury upbeat on Cell

Mecury Computer Systems released its the first quarter of fiscal 2007 (8-K) and although it lost money last quarter its President & CEO Jay Bertelli was upbeat about Cell BE processor technology. From the 8-K:

"Mercury reported a significant level of activity around our Cell BE processor-based offerings."

http://treowth.blogspot.com/2006/10/mecury-computer-systems-reports-early.html

I wish we had some idea of the royalty Rambus will be receiving from Cell.

Ocean Tomo 300 Patent Index

It is launched 10/25/06, AMEX symbol OTPAT.

Rambus Inc. is a member of the index.

http://treowth.blogspot.com/2006/10/rambus-inc-ocean-tomo-300-patent-index.html

Rhetorical question? Well, no.

Thank you for your response. I have posted the same question on four boards, and you are the only poster to make an effort to respond in full - thank you. (Empiricum, made a thoughtful, partial response.)

As RMBS has a 4.25% in hand on DDR1, it is within the realm of possible that they will land a similar judgment at Samsung's expense in the court of the HJW. Perhaps, RMBS will be equally successful against MU?

Take the FTC out of the ultimate equation, play the entire deck and run the table on DDR1 - through appeals if necessary. Don't bother settling for less than 3.5% for DDR1. License DDR1 progeny on the same basis. Heck, we have waited 6 years, what's another 3-4?

I see risk in what we refer to as the AT trial of nominal damages or at least offsets.

JMHO.

Assume RDRAM became the standard:

Assume RMBS were to collect a 1.5% royalty on all RDRAM - what is the estimated market per year?

Would RDRAM remain the standard today or would there be RDRAM-2?

If RMBS has in hand an Order for a 4.25% royalty for all MM except IFX for DDR1, will in fact RMBS not be better off having had RDRAM not becoming the standard?

Will the MM in the AT case be able to point to the 4.25% and say "you aren't actually harmed - with the jury maybe awarding RMBS nominal damages in the amount of $1.00?" Is this possible?

Mr. Hughes is in hiding?

He dislikes shareholders who don't have parking spaces at Rambus Inc. - tells them to go buy Coke.

The DRAM industry hates his company.

The largest non-insider shareholder parted with the bulk of his shares in 2006.

The SEC sends love letters. Bond holders threaten. Who knows what the FBI is doing?

ThreeJack you ask:

"Can Mr. Hughes cite any concrete actions Rambus is taking to join the dialogue?"

I think the cat has Mr. Hughes' tongue.

Really, it is sad. Mr. Hughes could have been a leader if he had stepped up and handled the option disasters humbly in a timely manner . . . wasted talent.

Backdating costs continue to mount.

<Looks like a technicality it appears they aren’t in default of the loan payments just the terms>

Default notices cost money to generate. I doubt the trustee is working for free or anywhere near the minimun wage!

I was contacted by a law firm regarding serving as a lead plaintiff. I LOL . . . but come on, at some point one wonders what the heck they are doing in Rambushire.

I am still believing there is a good reason for the delay and that there is a plan in place - but I am not drinking Kool Aid.

Question for the bond experts:

Could there be a financial reason for RMBS to allow a default of this convertible bond?

<Regarding the options backdating: Despite having occupied ourselves with that problem for most of the last three or four months, we will soon realize that we just wasted a lot of time, energy and emotion. In a matter of weeks now, we will get the results of the investigation, and most likely it will prove to be a minor and passing problem.>

Respectfully I disagree with "minor and passing".

Misdating is another nail in the coffin of shareholder disrespect, yes even abuse by the directors and officers. The Ramboids (who hang on) may all be wealthy one day, but I for one, well never feel sorry for how hard the directors and officers had to work / litigate to be rewarded for the IP . . . the moral high ground was lost by their greed and their slowness in coming clean.

I hold out hope that the slowness is due to a non Rambus employed party . . . perhaps, Rambus has fashioned a method of payback for which they have requested an IRS determination letter. I want to think good things, but the silence only allows me to imagine . . . and I imagine laughter and empty Coke cans . . .

<$14 now what??>

Let the drift begin. Without hype and or good news, what will support $14 or $11?

I am hoping that the misdating issue will find at least internal resolution - even bad news in that regard may be seen as a positive.

I am hoping that the bad news isn't as bad as I imagine. Seeing Mr. Tate doing the perp walk isn't likely to boost my net worth.

. . . but then I was wrong, $14 arrived first!

<what happened today??>

You tell me!

Somebody has a leak or the media ran like lemmings - JHMO. Expect a picture of lemmings on treowth by tomorrow. I am betting we see $10 - $11 before $14 - $15. Hope I am wrong.

<Does anybody know what a BLUE BRIEF is ?>

ThreeJack hit the nail on the head.

FEDERAL RULES OF APPELLATE PROCEDURE
Rule 32. Form of Briefs, Appendices, and Other Papers
(2) Cover. Except for filings by unrepresented parties,
the cover of the appellant’s brief must be blue; the
appellee’s, red; an intervenor’s or amicus curiae’s,
green; any reply brief, gray; and any supplemental
brief, tan.

http://www.fedcir.gov/contents.html

<To offer story ideas or comments, contact reporter Ken Dey at kdey@idahostatesman.com or 672-6757.>

I sent this email:

How about an investigative article on the relationship between the FTC and Micron?

<It is the pragmatic decision, and good businessmen do it every day; lawyers be damned.>

***

Most "good businessmen" do not have a business model that lives on IP.

I remain convinced that Rambus most give somebody a knockout punch or face thieving bullies everyday on the way to school.

Indeed Rambus can settle with the FTC on some middle ground as "good businessmen" and deliver a knockout punch in the AT case. If this is the course, my vote is to hit Micron with the full bill.

My preference is to proceed full steam ahead through the FTC remedies phase and then appeal. Leave the good businessmen on the golf course and hire more "damned lawyers."

To battle, I say, to battle . . .

<Wonder why he is not taking delivery of vested RUs?? First time I've ever seen anything like this.>

I believe that Restricted Stock Units are the stock options under the new plan and vesting triggers a tax event. Under the old plan Mr. Danforth could vest his options without triggering a tax event and was not required to exercise until just before expiration years later.

I believe that Mr. Danforth is sensitive to shareholder concerns about options, etc. I believe he has had a trading plan in place since late '04.

<I console myself today that virtually everyone tanked . . .>

Gary, on the short run, we should have listened to HH and bought Coke ... I believe it is within pennies. I thought HH was trying to kick us out of the cult. Perhaps, he was winking when he made his infamous statement?

<Exactly what does RMBS have that will save INTC's bacon?>

***

Respectfully, ask AMD.

<Still waiting for Intel to re-up - I know Harry would not let me down.>

***

Intel has its own problems to worry about. I wouldn't count on Intel saving Rambus bacon - even if Harry does what needs to be done. Rambus may need to save Intel bacon.

HH (& Rambus) is clueless when it comes to the shareholders. That noted, and I realize I am in a shrinking minority, but I believe that HH is doing what can and needs to be done with respect to ultimate shareholder value.

It hurts that I did not sell in the $40's, but I am a longterm investor and not a trader. The Rambus story remains a good one - IMHO.

Remember, even the Titanic had survivors.

<they seem to be making and selling RDRAM without a (valid) license>

***

Respectfully, you are in error. Rambus specifically announced that the RDRAM & XDRAM relationship continued with Sammy.

There are enough real issues on which you can focus if you want to spread FUD.

And yes, I could be wrong - but I do provide links to support my opinion. See #10757.

Any Donkey

<According to Rambus Inc., Sam does not have a license for XDRAM.>

***

Bear, I agree that Rambus website does not indicate a license.

However, I respectfully disagree with your statement copied above.

I do believe that Samsung is producing XDRAM and the fact that Samsung is not "listed" relates to the politics of the litigation.

Here is a snip from a Rambus press release (6/6/05) - the day that Rambus added Samsumg to the DDR2 memory devices and GDDR2 and GDDR3 graphics memory devices litigation:

"While we have regarded Samsung as a valuable licensee of our patents for certain applications, a number of issues now exist that have made the renewal and expansion of the Samsung SDRAM/DDR license difficult," said Harold Hughes, chief executive officer at Rambus. "These issues have caused us to terminate that license prior to its scheduled June 30, 2005 end date. We continue to value our relationship with Samsung as one of the primary manufactures of memory using our XDR DRAM and RDRAM designs. We very much hope that there is an opportunity in the near future to normalize all other aspects of our relationship as well."

http://www.rambus.com/news/pressrelease.aspx?id=35

I could be wrong.

Any Donkey