Blackberry-maker Research in Motion (ticker: RIMM) received a mixed judge's statement in its ongoing patent-infringment lawsuit with NTP yesterday. In a note to clients, Lehman Brothers' Jeff Kvaal and Tim Luke commented on the two sides of the judge's statements, and implications to the RIM stock:
We believe this increases the likelihood of a settlement in the range of the previously agreed $450 million or $2.25 per share. We would consider this a positive for RIM. We believe RIM's shares have traded down approximately $10 over the past one-two months on NTP concerns...
Positive for RIM: The District Court indicated that it would hold a hearing on the $450 million settlement from this past spring prior to issuing a ruling on the injunction. NTP pulled away from the settlement in early summer. RIM had asked the both the Court of Appeals and the District Court to enforce the settlement...
Anticipated Setback for RIM: District Court Unlikely to Wait for Patent Office Before Ruling --The Court also indicated that it would not likely wait for the Patent Office to finish its review of NTP's patents. Because the First Office review at the US PTO has rejected all of NTP's patents, RIM had hoped the District Court might wait until the Patent Office's final review was complete - a process that might take 1-3 years. The Court's unwillingness to delay the proceedings is a setback for RIM, although one anticipated by investors.
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