Quarterhill Inc (QTRHF)

[jtdiii]

Is Apple's "icloud" and i4i's HUGE victory today over Microsoft good for WiLAN?


It "could" bode well for WiLAN that WiFi networks will be the delivery system for Apple's iCloud, that will store mobile apps, documents and other information in the cloud and share it across multiple iOS devices...More

http://www.fiercebroadbandwireless.com/story/apples-icloud-accelerate-wi-fi-offload/2011-06-09?utm_medium=nl&utm_source=internal

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It "could" also bode well for WiLAN that the U.S. Supreme Court ruled against Microsoft Corp on Thursday in its appeal of a record $290-million (U.S.) jury verdict for infringing a small Canadian software firm’s patent.The justices unanimously upheld a U.S. appeals court’s ruling that went against the world’s largest software company in its legal battle with Toronto-based i4i.More:

http://www.theglobeandmail.com/report-on-business/microsoft-must-pay-torontos-i4i-in-patent-suit/article2053417/

The high court rejected Microsoft's argument to adopt a lower standard to replace the long-standing requirement that a defendant in a patent infringement case prove by clear and convincing evidence that a plaintiff’s patent is invalid.This is a key part that could affect WiLAN's motions in their V-Chip litigation.

Now that i4i has won its case against Microsoft, a huge cloud of doubt has disappeared. That's a risk that many big institutional investors would want to stay away from, because it could have been a game changer.

The next major catalyst depends on WiLAN's V-chip case with LG. If the analysts are right, and Wi-Lan wins a settlement, this could provide a windfall between 140M and 200M.

Given a 30%(+/-?) contingent fee, that would average between 98M (140M x 70%) and 140M (200M x 70%) in revenue for Wi-LAN.

Take another 15% off for overhead (this percentage reduced because of the contingent fee) and suddenly there's between 83.3M and 119M in earnings.

Divide that out by a 6 year contract, and it comes to between 14M and 20M in earnings per year and an EPS between .13 and .18.

Given a P/E of 15, this alone should bump up the share price by $1.95 to $2.70. On top of the price target of $10.00, it could mean close to a value of $13 by year end, on top of potential layering of revenues in the next couple years through newpatent licensing agreements through Gladios and dividend increases.

BTW,the CIBC report from Feburary has an estimated value of remaining V-Chip deals to worth $18.48 million in annual revenues. That means not only LG but Sony, Samsung & Sharp as well. It list's the estimated value of current V-Chip deals to be $37.78 million.