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Strategies & Market Trends : Drillbits & Bottlerockets -- Ignore unavailable to you. Want to Upgrade?

To: Rich1 who wrote (10493)	5/9/2001 4:40:33 PM
From: Original Mad Dog	Read Replies (1) \| Respond to of 15481

Rich1, Since it was a jury verdict, there is no court "opinion" on this one.... Here's the news release (pasted from the RMBS thread) Rambus Must Pay $350,000 to Infineon in Microchip Fraud Case By Susan Decker Richmond, Virginia, May 9 (Bloomberg) -- Rambus Inc. committed fraud by using information from an industry standards committee to obtain microchip patents, a federal jury decided, ordering the company to pay $3.5 million in punitive damages. U.S. District Judge Robert Payne reduced the jury's award to $350,000, the maximum allowed by Virginia law. After deliberating about 4 1/2 hours following a three-week trial, the jury also decided that the company's actions did not constitute racketeering against Infineon Technologies AG. Rambus shares fell 44 cents to $13.26 in afternoon trading. Infineon's American depositary receipts fell $1.35 to $40.45. My thoughts, on a situation I know only a little about: 1. If RMBS' patents were fraudulently obtained because they were based on information that is now considered to have been "stolen", there is a case for requiring them to refund the license fees already paid by licensees for the rights to practice the inventions described in those patents. Steal a car and sell it, you don't get to keep the money. 2. A big issue is going to be how many of RMBS' patents are affected by the verdict and how important those are. If these are the patents from which RMBS derives or has derived most of their revenue, then (a) nobody is gonna sign on the dotted line to pay them anything anymore; and (b) the line will go down the courthouse steps and around the corner with parties demanding refunds, with interest and possibly penalties or punitive damages. If the patent were merely held invalid for other reasons, this would not be the case, but if the patent is based on stolen information that is a whole 'nother story. 3. You may start to see a movement toward IP integrity as a core corporate governance issue. If RMBS really did steal this stuff from the industry standards committee, there had to be a degree of intentional misconduct going on, probably at a pretty high level. It may not have been enough to send people to jail, but it very well might deep six the company, and other companies tempted to be aggressive in this manner might now think twice. 4. If the core of RMBS' important technology is at issue in this verdict, then RMBS investors should give serious thought as to whether the terminal value of the enterprise is zero. If revenue dries up, nobody trusts the portfolio enough to buy it or license it, and the past victims start tearing at the carcass, it doesn't take long for a company like that to simply go out of business altogether. I'm not saying that will happen, but it is a possibility that must be considered by RMBS investors. JMHO...and I caution everyone I do not know the details of the saga as I am sure others around here do.....so you may wish to take this with a grain of salt.....