Re: The Suit
Well Mark, the suit has certainly stirred things up around here with some new names joining the party. It appears Joe was pretty close with his short-term reaction prediction of a move lower followed by a rise to $3. (Joe, I hope you made some money on the day trades).
As far as the suit goes, I thought KE handled it quite well by stating, "This is a simple case of protecting Iomega's intellectual property," and "...we intend to enforce our rights with respect to Iomega's patented technology." IMO, this is something that Iomega had to do and any other action would have been unfair to their employees and shareholders.
I was surprised however, that they also decided to defend their JET trademark. In their press release they stated that the JET trademarks were used by Iomega as early as Feb-1996 and that Syquest began using "SyJet" a year later. I can recall reading about the "SyJet" back in early January of 1996 as Syquest was getting ready to introduce the drive at MacWorld. I can only guess that Syquest never made the name "official" until much later. As to Iomega's claim that "this has caused confusion as to the source of SyQuest's products", I find that hard to believe.
I wasn't surprised at Harper's responses. IMO, he shows no class and once again is extremely misleading when he says, "The high performance removable storage category belongs to us." JAZ has a current market share of over 60% with 1 million units sold and the SyJet is just beginning to sell. SyQuest may have sold 3 million plus drives in its history, but that news is old.
Well anyways, it's been interesting to watch the resulting high trading volume and the trading ranges these past few days. I doubt we would have seen this level of activity if we weren't so close to earnings. The collision of these two events should provide more viewing pleasure over the next week or so.
Then, SyQuest will release their improved revenues (which I'd guess will be about $35 million) and their improved losses (which I'd guess will be about $13 million), and the suit will be forgotten, and the volume will drop, and the daily trading ranges will shrink, and the buyout rumors will fade away and the selling will begin again.
But while the fire is hot, I'll be doing some trading and won't hold this puppy for even a minute if I can get over $2-3/4.
Regards - Dale |
