Re: Lexar patent suit. It is common in civil suits filed in Federal courts for a magistrate to be appointed and to invite the parties to a settlement conference. This does two things - it helps keep the docket from becoming overloaded, and it may help keep down court costs not only for the parties but for the court itself (i.e., us taxpayers).
From the information you provided, it appears that Lexar was being notified to post bond. This is common where a preliminary injunction is requested, as opposed to a permanent injunction. Defendant SanDisk probably argued that a preliminary injunction would result in loss of millions of dollars of business, thereby requiring Lexar to post bond. Asking for a preliminary injunction, particularly where the court has already ruled that the other party is likely to prevail at trial, is indeed risky, and reinforces the argument that this lawsuit is being pursued mainly to harass, in the hope of reaching some out of court settlement that allows Lexar to remain in business, but at the same time relieves Lexar of past liabilities for patent infringement. Because civil actions of this sort are so expensive for both parties, and worse, because they drain valuable energy that the defendant could otherwise devote to expanding the business and improving the product, a settlement frequently gives the erring party (in this case very likely the plaintiff Lexar) more than it deserves.
A recent shareholder suit against Trimble Navigation, another Silicon Valley company, though not dealing with patents, illustrates the corrosive effect of litigation. A group of shareholders claimed that Trimble's public pronouncements misled them into thinking the company was more profitable than it actually was. They sued and reached a settlement after several years, in which shareholders in the class get very little extra (but their lawyers did quite well). The real problem here was not misleading statements as much as poor quality management decisionmaking - a "sin" that should be, but is not amenable to lawsuits. In any event, after a management change, Trimble is now on the way to recovery.
SanDisk has given the public very little info on the progress of the litigation (which is good, in the sense that one usually does better by keeping the cards close to the chest). By not giving in, but simply by pursuing its rights under the court procedures, SNDK is acting in its shareholders' best interests.
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