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EXP is a graduate from The University of Wall Street (EF Hutton / Shearson Lehman) and the CEO / Chief Stock Strategist at EXPstocktrader.com research firm. With over 30 years of trading the market, EXP is an experienced market geek. A technician using a technical approach; a technical analyst,... More
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  • Global Patent Wars Continue - Vringo Case Takes Center Stage This Week 10 comments
    Oct 17, 2012 7:25 PM | about stocks: AOL, CSC, GCI, IACI, NOK, TGT, VRNG, ZTCOF, GOOG

    If you read my prior article written several months ago in June 2012, you will see that many I/P (patent) stocks are grabbing a lot of headlines these days! It appears that the Vringo (NASDAQ:VRNG) vs. Google (NASDAQ:GOOG) I/P patent dispute is taking center stage right now.

    VRINGO:
    Most notably in the past several days, Vringo has grabbed a lot of attention and followers since they filed suit against Google, and their customers: AOL (NYSE:AOL), Gannett (NYSE:GCI), IAC/Interactive (NASDAQ:IACI) and Target (NYSE:TGT) who have been accused of using Vringo's patented intellectual property for several years to boost revenues.

    Allegedly, Vringo's position is that Google, as a search engine, was struggling until they adapted and changed over to the Vringo's patented processes to help them boost their sales immediately to +20%. In court, it has been suggested that Vringo is interested in damages of 3.5% of the additional revenues that Google has participated on with the help of Vringo's patents. Their feeling is that the 3.5% past use for these patents is a reasonable and acceptable number. Keep in mind that a judgment could range from 1% - 5% though.

    I have done some extensive due diligence on this case and believe that you will see Vringo's expert witnesses including (very credible) Dr. Ophir Frieder (who holds the Robert L. McDevitt, K.S.G., K.C.H.S. and Catherine H. McDevitt L.C.H.S. Chair in Computer Science and Information Processing and is Chair of the Department of Computer Science at Georgetown University. He is also Professor of Biostatistics, Bioinformatics and Biomathematics in the Georgetown University Medical Center. He is a Fellow of the AAAS, ACM, and IEEE) testify that Google is and has been infringing on the patents "ab infinito" - meaning from the beginning! So much so, that Google allegedly even told their best customers of the change in the processes about the new processes which is exactly what Vringo patents do. So, I strongly suspect that Dr. Frieder will testify that Google is the best company at explaining exactly what Vringo's patents are all about.

    ZTE:
    Following the lawsuit against Google et.al. Vringo has also filed in court a lawsuit against China's #2 telecom maker giant ZTE (OTCPK:ZTCOF) over their alleged use of the Nokia (NYSE:NOK) patents that Vringo recently purchased to go after suspected patent infringers. ZTE is currently doing business in about 140 countries.

    Vringo Stock Performance Throughout The Year 2012:

    Special Note Regarding Dr. Freider's Case History and Experience:

    Prior to Joining Georgetown - Consulting and Staff Positions Include:

    January 2001 - August 2008
    August 1996 - February 1999
    Consultant to the Information/Government Systems Division
    Harris Corporation
    Melbourne, Florida

    May 1999 - December 2000
    Consultant
    IIT Research Institute
    Chicago, Illinois / Bethesda, Maryland

    August 1995 - September 1997
    Consultant
    Software Productivity Consortium (SPC)
    Herndon, Virginia

    September 1994 - August 1996
    Consultant
    Science Applications International Corporation (NYSE:SAIC)
    Arlington, Virginia

    November 1993 - June 1994
    Consultant
    IBM Federal Systems Company, (Loral Federal Systems - as of March 1994)
    Manassas, Virginia

    June 1992 - August 1993
    Consultant to the Computer and Software Engineering Division
    Institute for Defense Analysis
    Alexandria, Virginia

    August 1991 - July 1993
    Consultant to the Technical Services Division at Headquarters
    Federal Bureau of Investigation
    Washington, DC

    Selected Short Term Consultancy Contracts:
    Computer Sciences Corporation (NYSE:CSC), Landham, Maryland
    IBM German Software Development Laboratory, Germany
    Computer Data Systems, Inc. (OTC:CDSI), Rockville, Maryland
    Information Systems & Networks Corporation, Bethesda, Maryland
    CALIBRE Systems, Inc., Falls Church, Virginia
    The Library Corporation, Inwood, West Virginia

    Legal Consulting:

    Dr. Freider has consulted as a technical expert or as an expert witness on several intellectual property disputes. His disputed topics include multiple Internet commerce and software technology issues. His case history includes:

    Case: MercExchange vs. GoTo.com
    Role: Plaintiff expert witness
    Firm: Hunton & Williams
    Resolution: Out of court settlement

    Case: MercExchange vs. Ebay.com
    Role: Plaintiff expert witness
    Firm: Hunton & Williams
    Resolution: Willful infringement court verdict - heard by U.S. Supreme Court

    Case: Hewlett-Packard vs. Intergraph (third party lawsuit vs. Microsoft)
    Role: Defense technical expert for Microsoft
    Firm: Venable
    Resolution: case dismissed

    Case: e-Plus.com vs. Ariba.com
    Role: Plaintiff expert witness
    Firm: Hunton & Williams
    Resolution: Willful infringement court verdict

    Case: Autobytel.com vs. Dealix.com
    Role: Plaintiff technical expert
    Firm: Paul Hastings
    Resolution: Out of court settlement

    Case: IBM vs. Amazon
    Role: Plaintiff technical expert
    Firm: Jones Day
    Resolution: Out of court settlement

    Case: Civix vs. Yellowpages.com, Travelocity.com, Orbitz.com
    National Association of Realtors, & Yahoo!.com
    Role: Plaintiff expert witness
    Firm: Niro, Scavone, Haller & Niro / Niro, Haller & Niro
    Resolution: Out of court settlements

    Case: Nokia vs. Qualcomm
    Role: Plaintiff technical expert
    Firm: Alston & Bird
    Resolution: Out of court settlement

    Case: Mapquest vs. Civix (breach of contract - not IP dispute)
    Role: Defense expert witness
    Firm: Niro, Haller & Niro
    Resolution: Out of court settlement

    ------------------

    Please refer back to another follower's argument about:
    What The Supreme Court Says About Vringo?
    Please see the article here.

    ------------------

    In Summary: Vringo has substantial and sufficient evidence and witnesses from industry experts to prove that the accused infringed on the asserted claims of the '420 and '664 patents. Vringo will show the court substantial exhibits and testimony relating to the issues of material facts that do exist. Experts will explain in detail, what I believe to be, overwhelming evidence in this case that demonstrates that infringement of the '420 and '664 patents do exists.

    It is my belief that Vringo is looking for is some kind of "reasonable" settlement or judgment for prior use of their patents, as well as, future licensing / royalties for ongoing uses of the Vringo patents. At this point, no one knows what the outcome will be, so we will have to wait for the courts and/or two sides to come to some kind of mutual agreement or wait for the trial to run its course?

    In the meantime, please stay tuned for more updates relating to Vringo as the trial with Google continues and the court proceedings with ZTE start to take shape. Also, one last note: I suspect that there will be other suits to follow with additional search engines like Google and possibly other telecom firms like ZTE?

    Disclosure: I am long VRNG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Themes: long-ideas Stocks: AOL, CSC, GCI, IACI, NOK, TGT, VRNG, ZTCOF, GOOG
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Comments (10)
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  • thomasmowry
    , contributor
    Comments (19) | Send Message
     
    Positive, thoughtful postings like this are welcome reminders on why we bet on the VRNG team.

     

    Thanks for not trying to monetize your observations, which seems to be the trend on SA lately....
    17 Oct 2012, 08:21 PM Reply Like
  • trexia
    , contributor
    Comments (165) | Send Message
     
    http://bit.ly/RIUOdz
    Think: NTP suing RIMM on patents. NTP had nothing going on other than the patents. Like Vringo/Innovate. NTP won over $600 million from RIMM once Research in Motion realized this is a serious issue and not one they can just chalk up to a bad nightmare.

     

    (the beginning of the end for RIMM)
    Guess who NTP’s lawyer was? Donald Stout. Guess who Vringo’s patent lawyer is? Donald Stout. Why is Donald Stout so good? He was an examiner at the US Patent Office. He knows patents. They announced all of this but nobody reads announcements of a small public company like Vringo. It’s hard enough figuring out how many pixels are on the screen of Apple’s amazng iPad 3.
    18 Oct 2012, 08:25 PM Reply Like
  • jsIRA
    , contributor
    Comments (2425) | Send Message
     
    Good writing. Specially on Dr. Freider's Case History and Experience.
    17 Oct 2012, 08:27 PM Reply Like
  • EXPstocktrader
    , contributor
    Comments (388) | Send Message
     
    Author’s reply » This week...the judge DENIED Google's emergency motion to strike Vringo's liability expert, Dr. Frieder's, supplemental opinions commenting on the 250 pages of source code!!!
    17 Oct 2012, 09:24 PM Reply Like
  • asia24
    , contributor
    Comments (141) | Send Message
     
    Nice breakdown of Dr. Freider's Case History and Experience. I suspect that Google's Legals team is blowing smoke out of their own ass and going in circles as their weak MSJ was denied proving there is validity in the patents and Vringos case.
    17 Oct 2012, 09:46 PM Reply Like
  • EXPstocktrader
    , contributor
    Comments (388) | Send Message
     
    Author’s reply » Freider testimonies usually lead to settlements. And any hint of settlement will launch this stock up like we saw in $VHC when it was $5 a few years ago. That stock went to over $40. I would like to see this at YTD highs then re-evaluate and get ready for ZTE.
    17 Oct 2012, 10:45 PM Reply Like
  • jsIRA
    , contributor
    Comments (2425) | Send Message
     
    What today's bear raid means for this stock:

     

    We may see new highs soon.

     

    Market makers had a big quick short term bear raid before market close to create fear and wants to shake all weak hands out before making it much higher.

     

    Check what happened to ANR on Sep. 4. Before moving it up, market makers first pushed it to a new low, seemed a break-down and then started ito have a huge run on ANR.

     

    This thing happens all the time. That is why it is not easy to make money in stock market.
    17 Oct 2012, 11:01 PM Reply Like
  • Kevin Porter
    , contributor
    Comments (1727) | Send Message
     
    Excellent Article

     

    I will add my pos if the stock is weak
    18 Oct 2012, 07:58 AM Reply Like
  • jsIRA
    , contributor
    Comments (2425) | Send Message
     
    It is quoted at 3.98/4.00 in pre-market trading. Bought some shares. Very attractive. Will buy more if it dropped to $3.50.
    18 Oct 2012, 09:06 AM Reply Like
  • ND4SPD30
    , contributor
    Comments (8) | Send Message
     
    Thank you for the well written article. Hopefully the longs will be rewarded soon!
    18 Oct 2012, 05:44 PM Reply Like
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