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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Craig Freeman who wrote (16649)	11/15/2000 7:29:20 PM
From: orkrious	Respond to of 60323

$6M net is nothing. IMHO, either SNDK has a darned good reason to want a royalty agreement on LEXR's IP, or LEXR quietly found a way to shoot down SNDK's IP. Otherwise, what possible reason was there for SNDK to settle? Craig, I am in complete agreement with you. With LEXR intentionally infringing on SNDK's patents, this settlement does not make sense. I wonder if Eli knows something LEXR doesn't? Maybe it is his opinion that LEXR isn't going to have a successful work-around product. The press release states: Subject to Lexar's representations and warranties relating to Lexar's newly designed CompactFlash(TM) and PC Cards, SanDisk has stipulated that these designs do not infringe SanDisk's `987 Patent. It is kind of hard to believe that LEXR could so quickly come up with a viable alternative. It is not now in production. Maybe Eli thinks they won't be able to successfully mass produce their redesigned product. I am grabbing at straws here. Not much else makes sense. Jay

To: Craig Freeman who wrote (16649)	11/15/2000 7:32:50 PM
From: Ausdauer	Read Replies (2) \| Respond to of 60323

When SNDK agreed that LEXR's new designs were non-infringing, they created a competitor. If the Lexar product is competitive, they are free to go head-to-head with SNDK on future license agreements. Craig, you may be right, but I think it is too early to tell. In my estimation the fact that '987 was challenged and successfully defended is a big positive. Other CF assemblers (like Lexar) that were on the fence about signing a licensing agreement that includes '987 are probably now encouraged to finalize pending deals. Also recall that... Subject to Lexar's representations and warranties relating to Lexar's newly designed CompactFlash(TM) and PC Cards, SanDisk has stipulated that these designs do not infringe SanDisk's '987 Patent. I interpret this statement to mean that SanDisk still has the authority to review and consider the technology incorporated into the redesign. Further, whether this new solution is an improvement or whether it is even a viable alternative at all is yet to be seen. It would be foolish for a CF assembler to license an untried and untested controller from Lexar at this point. Also, until SanDisk is content that the redesign lives up to Lexar's representations we do have a window of opportunity to sign up licensees. Is it possible that part of these discussions could include an exclusivity agreement or even a multi-year license between SanDisk and the licensee? Finally, I agree that the net $6 million dollars seems like chump change. Has someone added up Lexar's CF revenues for the last two years and calculated what 4% might be? Ausdauer@nobody_licenses_vaporware.com