SmartMetric Inc (SMME)

[highalpha]

I guess I see things differently from others on this board.

Unfortunately I have Not Read the Pleadings in this Case. I have read the posts, and listened to C. Hendrick's conference call. So, I welcome clarification regarding the Pleadings.

MY understanding (and opinions) of this litigation follows:

Current motions before the District Court
1. SmartMetric filed a Motion for Partial Summary Judgment asking that patent 464 be found valid, and that defendants infringe on it by using their chip and pin cards that are swiped through a device whose info is sent over a wire (whether it is public or private)

2. SmartMetric filed a Motion for Summary Adjudication asking for damages

3. Defendants filed a Motion for Summary Judgement which presumably says the patent is not valid, or if it is there is no infringement.

My Optimistic View of this Litigation
The trial court would seemingly be bound by the US Court of Appeals Ruling that I understand said patent 464 covers use of the chip and pin cards swiped through a device. That ruling was specifically made regarding SmartMetric as Plaintiff, patent 464, and against defendants V/MC. Yes, it was in a prior litigation between the parties. But is also pertains to the Present Litigation as it relates to the same Parties and Patent.

I recall C Hendrick saying there have been Two Markman hearings. Have you seen what a Markman Hearing is? Check out http://en.wikipedia.org/wiki/Markman_hearing

It is my understanding the US Court of Appeals Ruled that SmartMetric's patent 464 covers defendants V and MC use of chip and pin cards which are swiped through a device which is connected to a wire/line which then transmits the data. I would Assume that means the Court of Appeals is Agreeing that Patent 464 is Valid. Otherwise, why would the Court rule on the Claims?

Courts Don't Waste Time
If the trial court was going to grant defendants Motion for Summary Judgment, it would not waste time worrying about late filing of the plaintiff's damage claim and expert testimony. You only get to damages if there is a valid patent which defendants have infringed.

I think that Lost Profits are Not an Issue
SmartMetric is developing a more advanced fingerprint card. It's also true that their patent 464 covers the use of chip and pin cards which are wiped through a device.

It does not matter whether SmartMetric has started selling the advanced card, because chip and pin cards are different from fingerprint cards. And there is No legal requirement for defendants or end users of the cards to use either chip and pin or fingerprint. So, the two types of cards are not mutually exclusive It's possible for defendants to eventually offer both types and let the consumers decide.
Yes, the fingerprint card is Better, and Safer, and Easier for everyone. But, Defendants would simply argue that if SmartMetric was selling the fingerprint cards today, they are not comparable regarding lost profits.

There is an Issue of Reasonable Royalties
SmartMetric's patent 464 is valid and covers the chip and pin cards, and the reader devices which require cards to be swiped (regardless whether the line used by the device is public or private).

Regarding Late Filing
My online research found a patent attorney with an article on his website saying that IT IS NORMAL IN PATENT LITIGATION FOR PLAINTIFFS TO FILE LATE THEIR EXPERT WITNESS STATEMENT. AND IT IS NORMAL FOR COURTS TO ACCEPT THE LATE FILING, while considering sanctions. (No, I don't have the website link, so you can search if you want).

It seems this Court will accept the late filing, and might either sanction SmartMetic with money, or allow the the defendants to reopen discovery regarding damages. GOOD.
The important point is the expert statement and damage claim be allowed in. Letting the defendants reopen discovery is fine. Up till now, have defendants even taken this case seriously?
The judge (or jury if this goes to trial) needs a reasonable basis to make a decision.

It is my opinion, that Defendants are Now On Notice that the Trial Court may Deny Defendants Motion for Summary Judgment; may Grant Plaintiff's Motion for Partial Summary Judgment as to Infringement; and even Grant Plaintiff's Motion of Summary Adjudication of Damages.

If Defendants are Smart, they should Immediately Begin Negotiations to settle past damages and ongoing royalties.

Finally, I think C Hendrick, SmartMetric and Their Attorney are Doing a Great Job in Pursuing this Litigation.