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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Sunny who wrote (38253)	1/21/2001 10:58:09 PM
From: hueyone	Read Replies (2) \| Respond to of 54805

Sunny, I don't know if you meant to send that message to me but you did. Darn. I hope Ardethan comes back around to present some more information regarding his nomination. Disclaimer: I am not a lawyer. There is always a chance SST could lose something significant to ATML, but I doubt that is a big factor affecting the stock price right now--IMHO. The five year old SST-Atmel patent disputes started on January 3,1996, and as near as I can tell, SST hasn't lost any significant decisions. You may be surprised to learn that from SST's split adjusted low of $.625 on December 15, 1998 to its split adjusted high of $38.89 on June 22, 00, the SST stock price appreciated 6,122%. Most of this stock price appreciation took place not only while the "dark cloud" of ATML litigation hung over SST, but the "dark cloud" of Intel litigation hung over SST as well. SST successfully defended its IP against Intel, and now SST derives a significant revenue stream from Intel by providing flash for its PC motherboards. On July 5, 00, Jonathan Joseph of SSB downgraded SST and the semis. At the high of that day, SST sold at a split adjusted $32.12 and had a TTM PE of 169. After the downgrade, SST slid down along with the semis. Profit taking on its huge rise could have accelerated the fall as well. In addition, there seems to be a large number of analysts that hang on to the outdated perception that SST does nothing more than make flash for desktop PCs. But in Q3, PC bios accounted for 15% of SST revenues. Here is a chart of SST and the SOXX since the July downgrade: siliconinvestor.com For more information on the legal proceedings, please read page 23 of SST's 10Q filed 11/30/00 and pages 11, 12, 25 and 26 in SST's 1999 10K---all available on PDF at the SSTI website. It probably would not hurt to review Atmel's 10Qs and 10Ks as well, and, if you really want to get serious, you can find some opinions regarding the patents in question that have been rendered in other cases where SST was not a party to the proceedings. In addition, please review the articles below that made the fall news. They deal with Atmel patent numbers 811, 829 and 903. www2.marketwatch.com www2.marketwatch.com www2.marketwatch.com In my layman's review of the information, the only decision that I can tell that SST has lost in its five year old battle with ATML was the non dispositive ruling by the International Trade Commission (ITC) in favor of ATML for patent #903. And the ITC had to overrule its own Administrative Law Judge to make that decision. More importantly, SST has repeatedly stated that the impact of losing the patent #903 case before the ITC (or should SST lose the follow up case in SF District Court) will have immaterial impact on the company's guidance going forward. Nevertheless, I certainly respect your caution, because ATML and SST still have a number of ongoing issues to be settled. Best, Huey