Rough day yesterday, but some things to remember
First, thanks to Revlis for attending, and Lastchoice for getting the information to the board quickly.
The wonderful thing about the ITC from IDCC's perspective is that we don't lose anything if we are not successful. If we win, we get an injunction, which is a very strong incentive for the infringer to settle. If we don't, we are back where we were before, needing to go to court to get enforce our patents. I'm not saying this was not bad, it is. The staff report means we are less likely to prevail at the ITC, so we lose some bargaining power right now. However the hearing is ongoing, and the ALJ will render his decision based on all the evidence. However based on ITC history, I'd have to say we are the underdog right now.
Losing at the ITC means that we are back to the seemingly endless litigation, so IDCC will likely need to come down a bit in their requirements because getting a lump sum five years from now does not help the stock like getting recurring revenues will. The ITC is a shot to give us leverage and put a relatively short clock on getting contracts. If we don't get it not much worse off. As loop mentioned, the ITC decision is not binding in other courts.
I believe IDCC is confident in their position. I believe they knew what was in the staff report when Mr. Merritt commented that they turned down an offer that they would've taken in the past because they want to get full value for their IP. Management is experienced and knowledgeable. They are not caving in. Sammy's attorney said they felt our offer was double FRAND. That seems to be an acknowledgement that they do infringe on our patents. To be conservative, let's say IDCC offer is at the bottom of their stated range of $1-$2 a unit, so Sammy is saying 50 cents a unit is FRAND. Not the homerun we are hoping for, but would certainly support a much higher share price than where we're at today.
If we do not get an injunction against Sammy, we will have a second shot with some insight into the process when we take on Nokia. Nokia knew what the staff report was and yet still is fighting to avoid the ITC, so they know there is risk.
Bottom line, I am very confident IDCC has valuable IP - Samsung appears to have admitted that, even if they disagree on the value. I believe that they will get paid at a rate that will generate a much higher stock price. It will require even more patience. Selling at these levels is not a good choice if you’re in it for the long haul. So I'm staying with my investment in IDCC and am comfortable with it.
Boring blog like stuff if anyone is interested.
I couldn't sleep Monday night, not due to worry, but due to excitement and anticipation. Like I felt the night before the 49ers' last three Super Bowls. Very confident of victory and looking forward to seeing it come true. Was up at 6, checking the board. Finally decided to take a shower while waiting for news from the hearing. Come back to my computer and we're down 5 points. Shit. Check out the posts, see the news and have to decide whether to jump out or not. After a couple minutes of soul searching, decide that the bad news is more than fully taken into account and hold all my shares. However decide to sell my mom's shares, as she gets very nervous and the roller coaster is moving into a very wild section. After making my decision, I decided to walk away from the computer. I went out and spent 5 hours just doing things I like, including a good hard hour of racquetball that really helped me get rid of the tension and stress. Read the board when I got home - no big surprises. Slept like a baby. Now it's back to normal for an IDCC investor. Waiting and waiting for them to sign the next contract.
