Replies to post #82170 on e.Digital Corporation (fka EDIG)

[LGJ]

Could this be FRED FALK dressed as a Patent Troll? or is this Apple's Head Lawyer... you be the judge....LOL

[Cassandra]

In Connection With Patent Enforcement Actions That We May Conduct, A Court May Rule That We Have Violated Certain Statutory, Regulatory, Federal, Local Or Governing Rules Or Standards, Which May Expose Us To Certain Material Liabilities.
In connection with any of our patent enforcement actions, it is possible that a defendant may request and/or a court may rule that we have violated statutory authority, regulatory authority, federal rules, local court rules, or governing standards relating to the substantive or procedural aspects of such enforcement actions. In such event, a court may issue monetary sanctions against us or award attorney’s fees and/or expenses to a defendant(s), which could be material, and if we are required to pay such monetary sanctions, attorneys’ fees and/or expenses, such payment could materially harm our operating results and our financial position.

Source: e.Digital FY 2013 10-K: http://www.sec.gov/Archives/edgar/data/886328/000101968713002479/edig_10k-033113.htm

Note that this is a new risk factor disclosed by e.Digital that was not disclosed in any of the previous 10-Ks. I believe it was added in the FY 2013 10-K released on 6/27/13 because Newegg has filed a motion for attorney fees alleging misconduct (see Creative Dkt #43 and exhibits). Additionally the chief judge for the Federal Circuit, Randall R. Rader, actually urged district court judges to do such fee-shifting in the NY Times Op Ed dated June 4, 2013 which is shown in the post to which I am responding.

Anyone can access all of the previous 10-Ks here: http://www.sec.gov/cgi-bin/browse-edgar?company=e+digital&owner=exclude&action=getcompany

Keep in mind that the following disclosure about the previous Markman hearing is also included in the 2013 10-K:

On June 28, 2011, the United States District Court for the District of Colorado issued an Opinion and Order Regarding Claim Construction following a January 28, 2011 Markman hearing (a proceeding under U.S. patent law where both sides present to the Court their arguments on how they believe patent terms should be construed). The Opinion construed claim terms in United States Patent 5,491,774 (the ‘774 patent”) one of the Company’s Flash-R patents, more narrowly than we had proposed. This Markman ruling could negatively affect future licensing prospects with respect to the ‘774 patent.