Snowblow: Clawmann here ( you referred to me as "Crawfish" in one of your posts; I wish I'd thought of that).
Anyway, Donnerk0 posted one of my RB posts on this board.
And I read your response. Completely agree that a court judgment would have been better, but such things are costly to obtain. Being very familiar with the Rambus litigation (and the huge negative potential that on-going litigation over IP can have on a stock's PPS), I think that - at this still early stage of its development - NEOM is probably better off settling the Virgin suit as it did than fighting a long and costly court battle to obatin a judgment. I have to believe that the costs and benefits of both courses of action were probably seriouly weighed during the negotiation of that settlement agreement.
Furthermore, if anyone wants to know why the terms were not made public, I think the answer is obvious. My belief is that Virgin - being a major player that NEOM wants to work with going forward - probably got a sweetheart deal. But NEOM has other potential litigants and licensees out there. Revealing the terms of the Virgin deal could weaken NEOM's hand at the negotiating table with these other parties. They will want to start negotiating on the basis of the terms of the Virgin deal. And, IMO, NEOM will want to treat the Virgin deal as a one-off, having no relevance whatsoever to the terms of any other license/settlement agreements.
I believe that NEOM will disclose the deal only when and to the extent the law requires.
FYI: the following is the text of one other post on this that I put on RB a couple of days ago (responding to some poster's attempt to make something significant out of the fact that Virgin never acknowledged that it had infringed NEOM's IP):
I have never seen a settlement agreement that includes an admission of wrongdoing (in this case an admission of infringement). The normal pattern of such an agreement is that the plaintiff agrees not to pursue its rights in court further if the defendant agrees to do something that benefits the plaintiff.
For example Virgin could have said: "OK NEOM, without admitting that we (Virgin) have done anything wrong, we will agree to execute a license for your IP if you agree to withdraw your complaint against us." NEOM thinks about it and decides that accepting this offer is of more benefit to it than pursuing its lawsuit to the bitter end.
So the two parties negotiate the details of the agreement (which sets forth the terms of the license and maybe some other agreement on future cooperation), ink the deal and issue the press release.
Note: A "withdrawal" of a complaint in these circumstance is often accomplished by the submission to the court of a joint motion to dismiss, signed by the plaintiff and the defendant; however, it could be that the procedural rules of the court provide for another method of withdrawal. In the end the effect is the same: the plaintiff drops his suit because the defendant offered the plaintiff, and the plaintiff accepted, something that the plaintiff judged to be of equal or greater value.
In this case, NEOM agreed to stop suing Virgin and Virgin agreed to pay for a license of NEOM's IP. Virgin and NEOM may also have an additional agreement on some sort of future cooperation. Quite clearly, NEOM's interests were advanced here: an outflow (Legal Fees) was replaced by an inflow (Licensing Fees) and - possibly - the creation of a valuable on-going relationship with a major player.
It is almost certain that Virgin made no admission of infringement, but why would Virgin need to? If I agree to license your IP, I am implicitly admitting that I believe your rights to that IP to be valid (otherwise why would I agree to pay you to use it?) And if I had also previously used that IP without your permission, the logical conclusion must be that I am also implicitly admitting that my prior use constituted an infringement.
Neverthless, for legal and psychological reasons, people often don't want to explicitly say "What I did was wrong." They would prefer to just say: Let's stop this arguing, forget about the past, and agree to go forward on a mutually acceptable basis.
Besides, even if Virgin admitted out loud that it had infringed NEOM's IP, that admission would not have been of great worth to NEOM. Oh sure, it could have been the basis for NEOM to demand the payment of damages from Virgin in compensation for past infringenments, but pursuing such damages may have cost NEOM something more valuable: a cooperative relationship going forward.
Also, an admission of infringement by Virgin would have had almost no legal value to NEOM in its other lawsuits. You see, Virgin is not a court and therefore has no authority to make a binding legal determination about the validity of NEOM's IP.
No, I was not present in the settlement negotiations, but I am generally familiar with the dynamics and the considerations that tend to characterize such negotiations. From the information I have seen, I truly beieve that settling the suit with Virgin will have long-term positive ramifications for the company and its shareholders.
In short, I'll take an on-going revenue stream (license fees) and an agreement of future cooperation with a major player over an admission of infringement and a limited damage payment any day.
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AI
