Mark Hartner's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.com/user/5270211/comments http://seekingalpha.com/article/1088181/comments?source=feed#comment-13422961 13422961
CMU doesn't get hurt when Marvell manufactures allegedly infringing chips.]]> Mon, 07 Jan 2013 23:58:29 -0500
CMU doesn't get hurt when Marvell manufactures allegedly infringing chips.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13349361 13349361
The Judge bulldozed through all the motions and allowed the trial to go to a jury verdict. At the time of Marvell's press release there were no motions "yet to be ruled on", but there were still motions "yet to be filed" post-trial, and those will be ruled on.

Furthermore, on laches the judge ruled against the issue going to the jury but they can still raise that issue again post-trial.

I am submitting a correction to Seeking Alpha asking them to remove that section of the article.]]> Sat, 05 Jan 2013 22:11:29 -0500
The Judge bulldozed through all the motions and allowed the trial to go to a jury verdict. At the time of Marvell's press release there were no motions "yet to be ruled on", but there were still motions "yet to be filed" post-trial, and those will be ruled on.

Furthermore, on laches the judge ruled against the issue going to the jury but they can still raise that issue again post-trial.

I am submitting a correction to Seeking Alpha asking them to remove that section of the article.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13347991 13347991
As tempted as I am to dive into the issues you raise in your comments, I am going to refrain. If anyone is interested in a response, I might consider writing it up in a blog entry.]]> Sat, 05 Jan 2013 20:13:11 -0500
As tempted as I am to dive into the issues you raise in your comments, I am going to refrain. If anyone is interested in a response, I might consider writing it up in a blog entry.]]> http://seekingalpha.com/article/1091471/comments?source=feed#comment-13302981 13302981 http://seekingalpha.co...

My take on LSI is that they probably infringe, but that CMU is not going to go after them. My reasoning on that is that CMU filed their lawsuit just ahead of the 6 year mark because Marvell would have had a good laches defense after the 6 year mark. Now that 9 years have passed, LSI would have a really good laches defense, so it is much riskier for CMU.

I am not a lawyer, but I think of laches sort of like a "statute of limitations", but not quite as rock solid like it is for criminal law. For more on laches just look up the VRNG vs GOOG lawsuit and see what happened, the judge used laches to knock the damages award down to almost nothing.

I think that Marvell will continue to dominate the HD Controller market.]]> Fri, 04 Jan 2013 11:10:23 -0500 http://seekingalpha.co...

My take on LSI is that they probably infringe, but that CMU is not going to go after them. My reasoning on that is that CMU filed their lawsuit just ahead of the 6 year mark because Marvell would have had a good laches defense after the 6 year mark. Now that 9 years have passed, LSI would have a really good laches defense, so it is much riskier for CMU.

I am not a lawyer, but I think of laches sort of like a "statute of limitations", but not quite as rock solid like it is for criminal law. For more on laches just look up the VRNG vs GOOG lawsuit and see what happened, the judge used laches to knock the damages award down to almost nothing.

I think that Marvell will continue to dominate the HD Controller market.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13290851 13290851
Marvell is an excellent technology company. They know where technology is going, and rather than chase the ball they run to where the ball is going to be. Look at TI, who just announced they were getting out of the mobile processor business. TI missed the ball by not being able to integrate wireless into OMAP. Marvell's CEO on the other hand has been saying for years that things were going to a single chip solution and dove headfirst into 3G/4G and Wifi. Marvell broke into 802.11 Wifi at a time when it was an oligopoly of Broadcom and Atheros (now owned by Qualcomm). Those are incredible accomplishments.

I can only cover so much, and the area where I thought I could shed the most light was in the lawsuit.]]> Fri, 04 Jan 2013 01:35:48 -0500
Marvell is an excellent technology company. They know where technology is going, and rather than chase the ball they run to where the ball is going to be. Look at TI, who just announced they were getting out of the mobile processor business. TI missed the ball by not being able to integrate wireless into OMAP. Marvell's CEO on the other hand has been saying for years that things were going to a single chip solution and dove headfirst into 3G/4G and Wifi. Marvell broke into 802.11 Wifi at a time when it was an oligopoly of Broadcom and Atheros (now owned by Qualcomm). Those are incredible accomplishments.

I can only cover so much, and the area where I thought I could shed the most light was in the lawsuit.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13290671 13290671
One thing that has been hard for me to wrap my head around is Marvell's FCF. Marvell dilutes their shares so quickly, it is as if they are paying their employees in stock. Compound that with their share buybacks, sharecount numbers that don't quite add up, and it is really hard for me to get a good FCF analysis. I am interested in any insight you could share on Marvell's FCF. This is why I punted in the article and said Marvell's share count/buyback/dilution needs an article of its own.]]> Fri, 04 Jan 2013 01:19:16 -0500
One thing that has been hard for me to wrap my head around is Marvell's FCF. Marvell dilutes their shares so quickly, it is as if they are paying their employees in stock. Compound that with their share buybacks, sharecount numbers that don't quite add up, and it is really hard for me to get a good FCF analysis. I am interested in any insight you could share on Marvell's FCF. This is why I punted in the article and said Marvell's share count/buyback/dilution needs an article of its own.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13290441 13290441
Again, I am not a lawyer, but I think of laches sort of like a "statute of limitations", but not quite as rock solid like it is for criminal law. For more on laches just look up the VRNG vs Google lawsuit and see what happened, the judge laches to knock the damages award down to almost nothing.

I think there is a 0% chance of MRVL being prevented from selling their controllers and that Marvell will continue to dominate the HD Controller market.]]> Fri, 04 Jan 2013 00:47:44 -0500
Again, I am not a lawyer, but I think of laches sort of like a "statute of limitations", but not quite as rock solid like it is for criminal law. For more on laches just look up the VRNG vs Google lawsuit and see what happened, the judge laches to knock the damages award down to almost nothing.

I think there is a 0% chance of MRVL being prevented from selling their controllers and that Marvell will continue to dominate the HD Controller market.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13290251 13290251 Fri, 04 Jan 2013 00:30:00 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13290221 13290221 http://seekingalpha.co...

Now a question for you. Why would you trust Marvell's press release?]]> Fri, 04 Jan 2013 00:28:14 -0500 http://seekingalpha.co...

Now a question for you. Why would you trust Marvell's press release?]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13289951 13289951
Look at the trading volume on September 4th, the day after Marvell filed their Q2 report. No volume spike from a Friday to Monday.

Now look at the trading volume on November 30th, the day after Marvell filed their Q3 report. A 50% volume spike from a Thursday to Friday. Someone dumped 6.5 million shares that day, and the volume stayed high all the way through December 6th.

Take a look at December 21st, a massive 230% spike in volume to 19 million shares. I would say someone dumped over 10 million shares that day.

Someone was paying attention. Do you think it was Einhorn? He would have had to unload 32 million shares, but I think it is possible. I am really curious to know what others think.]]> Fri, 04 Jan 2013 00:12:58 -0500
Look at the trading volume on September 4th, the day after Marvell filed their Q2 report. No volume spike from a Friday to Monday.

Now look at the trading volume on November 30th, the day after Marvell filed their Q3 report. A 50% volume spike from a Thursday to Friday. Someone dumped 6.5 million shares that day, and the volume stayed high all the way through December 6th.

Take a look at December 21st, a massive 230% spike in volume to 19 million shares. I would say someone dumped over 10 million shares that day.

Someone was paying attention. Do you think it was Einhorn? He would have had to unload 32 million shares, but I think it is possible. I am really curious to know what others think.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13247131 13247131 Thu, 03 Jan 2013 02:10:39 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13247101 13247101 Thu, 03 Jan 2013 02:06:32 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13247031 13247031 Thu, 03 Jan 2013 02:00:57 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13247001 13247001 Thu, 03 Jan 2013 01:59:05 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13246881 13246881
Royalties on foreign sales is something Marvell's lawyers fought long and hard. Both sides seemed to struggle to find any convincing existing case law to argue, so this looked like an area where new ground was being broken. Where new ground is being broken I think there is a much higher probability of reversal at a higher level up.

I don't think the current judge is going to reverse the foreign sales royalties. The next judge might, but I don't know what the odds of that would be. Hopefully I gave you enough information so that you can pencil in your own odds.]]> Thu, 03 Jan 2013 01:48:26 -0500
Royalties on foreign sales is something Marvell's lawyers fought long and hard. Both sides seemed to struggle to find any convincing existing case law to argue, so this looked like an area where new ground was being broken. Where new ground is being broken I think there is a much higher probability of reversal at a higher level up.

I don't think the current judge is going to reverse the foreign sales royalties. The next judge might, but I don't know what the odds of that would be. Hopefully I gave you enough information so that you can pencil in your own odds.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13221191 13221191 Wed, 02 Jan 2013 11:47:09 -0500 http://seekingalpha.com/article/1088181/comments?source=feed#comment-13220671 13220671
If you want to see what CMU was trying to claim, take a look at docket 708, which is kind of a powerpoint summary of CMU's arguments. The Judge did not allow CMU to use this powerpoint presentation in court (she said they had to do it the old-fashioned way), but it gives you a good idea of what they were trying to argue.]]> Wed, 02 Jan 2013 11:35:34 -0500
If you want to see what CMU was trying to claim, take a look at docket 708, which is kind of a powerpoint summary of CMU's arguments. The Judge did not allow CMU to use this powerpoint presentation in court (she said they had to do it the old-fashioned way), but it gives you a good idea of what they were trying to argue.]]> http://seekingalpha.com/article/1088181/comments?source=feed#comment-13219841 13219841
I think the odds of a re-trial are very slim, just because Judge Fischer ruled against them on that motion, essentially saying that she would take it into consideration after the trial when looking at the damages award. Marvell's argument for a re-trial was that CMU had made some prejudicial closing arguments. The Judge let the trial continue to a verdict, but I think she may still us it against CMU as an excuse for not awarding any extra damages or to sanction the CMU's lawyers.

I have no opinion on the odds of a reversal, I'll wait for the patent lawyers to chime in. I do think that it would take several years for such a reversal to happen.

A settlement is also a tricky question. Both sides seem to have dug their heels in. I would also put the odds of a settlement very low.]]> Wed, 02 Jan 2013 11:22:23 -0500
I think the odds of a re-trial are very slim, just because Judge Fischer ruled against them on that motion, essentially saying that she would take it into consideration after the trial when looking at the damages award. Marvell's argument for a re-trial was that CMU had made some prejudicial closing arguments. The Judge let the trial continue to a verdict, but I think she may still us it against CMU as an excuse for not awarding any extra damages or to sanction the CMU's lawyers.

I have no opinion on the odds of a reversal, I'll wait for the patent lawyers to chime in. I do think that it would take several years for such a reversal to happen.

A settlement is also a tricky question. Both sides seem to have dug their heels in. I would also put the odds of a settlement very low.]]> http://seekingalpha.com/article/1083451/comments?source=feed#comment-13083101 13083101
An injunction isn't in the cards, that has already been decided by the Judge. As it stands, Marvell will pay 1.2 billion in back royalties and 50 cents per HD chip sold in the future.]]> Fri, 28 Dec 2012 21:04:42 -0500
An injunction isn't in the cards, that has already been decided by the Judge. As it stands, Marvell will pay 1.2 billion in back royalties and 50 cents per HD chip sold in the future.]]> http://seekingalpha.com/article/1083671/comments?source=feed#comment-13082741 13082741
You are also exactly right, that our patent system is completely broken and will chase companies away from the US.]]> Fri, 28 Dec 2012 20:37:53 -0500
You are also exactly right, that our patent system is completely broken and will chase companies away from the US.]]> http://seekingalpha.com/article/1083671/comments?source=feed#comment-13031511 13031511 Thu, 27 Dec 2012 12:39:48 -0500 http://seekingalpha.com/article/1083671/comments?source=feed#comment-13031351 13031351 Thu, 27 Dec 2012 12:36:39 -0500 http://seekingalpha.com/article/925491/comments?source=feed#comment-11614471 11614471 Wed, 14 Nov 2012 18:17:04 -0500 http://seekingalpha.com/article/964411/comments?source=feed#comment-11151861 11151861
I would like to add a little insight to the "Shares Outstanding" graph and Marvell's share buyback program. Based on Marvell's SEC filings, their recent share count looks as follows:
August 24th, 2012: 557.8 million (reported on 10Q filing date)
July 28th, 2012: 562.4 million (reported on quarter end)
May 25th, 2012: 563.4 million (reported on 10Q filing date)
April 28th, 2012: 580.0 million (reported on quarter end)
Mar 16th, 2012: 580.6 million (reported on 10k filing date)
Jan 28th, 2012: 607.9 million (reported on year end)

So, _roughly_ speaking, we can deduce the following:

Feb 1st -Mar 16th 2012: Marvell repurchased 27.3m shares
Mar 17th-Apr 2012: Marvell repurchased 0m shares
In Apr 2012: Marvell repurchased 0m shares
In May 2012: Marvell repurchased 17m shares
In Jun 2012: Marvell repurchased 0m shares
In Jul 2012: Marvell repurchased 0m shares
In Aug 2012: Marvell repurchased 5m shares

The takeaways are:
1) in addition to the share count reported at quarter end, we also get a sneak peek into their share count when they file their official 10Q a few weeks later (in the first page of their filing).

2) Marvell's share buyback pattern is erratic. They appear to be buying back shares in the few weeks leading up to their earnings announcement (true for at least for 2011Q4, 2012Q1 and 2012Q2). It would be interesting to dig further back and see if the same pattern still holds.

3) Marvell seems to have put the brakes on their share buyback program. There were hardly any shares bought back between May 25th to Aug 24th. The relatively small 5m shares they did buy back were also purchased around their earnings release in August.

4) With the amount of money Marvell has been putting towards buying back shares they have the ability to affect the share price short term, especially if the do the buyback in a more concentrated manner as they appear to be doing.

Mark]]> Fri, 02 Nov 2012 02:34:15 -0400
I would like to add a little insight to the "Shares Outstanding" graph and Marvell's share buyback program. Based on Marvell's SEC filings, their recent share count looks as follows:
August 24th, 2012: 557.8 million (reported on 10Q filing date)
July 28th, 2012: 562.4 million (reported on quarter end)
May 25th, 2012: 563.4 million (reported on 10Q filing date)
April 28th, 2012: 580.0 million (reported on quarter end)
Mar 16th, 2012: 580.6 million (reported on 10k filing date)
Jan 28th, 2012: 607.9 million (reported on year end)

So, _roughly_ speaking, we can deduce the following:

Feb 1st -Mar 16th 2012: Marvell repurchased 27.3m shares
Mar 17th-Apr 2012: Marvell repurchased 0m shares
In Apr 2012: Marvell repurchased 0m shares
In May 2012: Marvell repurchased 17m shares
In Jun 2012: Marvell repurchased 0m shares
In Jul 2012: Marvell repurchased 0m shares
In Aug 2012: Marvell repurchased 5m shares

The takeaways are:
1) in addition to the share count reported at quarter end, we also get a sneak peek into their share count when they file their official 10Q a few weeks later (in the first page of their filing).

2) Marvell's share buyback pattern is erratic. They appear to be buying back shares in the few weeks leading up to their earnings announcement (true for at least for 2011Q4, 2012Q1 and 2012Q2). It would be interesting to dig further back and see if the same pattern still holds.

3) Marvell seems to have put the brakes on their share buyback program. There were hardly any shares bought back between May 25th to Aug 24th. The relatively small 5m shares they did buy back were also purchased around their earnings release in August.

4) With the amount of money Marvell has been putting towards buying back shares they have the ability to affect the share price short term, especially if the do the buyback in a more concentrated manner as they appear to be doing.

Mark]]> http://seekingalpha.com/article/934491/comments?source=feed#comment-10713371 10713371
Revenues at Marvell have been basically flat for the past 3 quarters (800M +/- 3%), and the entire industry has been struggling this last quarter. I don't think Marvel's revenue drop alone is enough to justify the departure of their CFO.

I used the departure of their CFO as an excuse to take a deep dive into their most recently filed 10Qs. One thing I noticed was that there were some important changes in their 10Qs related to their upcoming patent trial with CMU on November 27th. Search Marvell's two most recently filed 10Q's for "Carnegie Mellon Litigation", and also take a look at http://bit.ly/VdjBrn

In relation to the CMU litigation, you will notice that in their most recently filed 10Q Marvell removed the language stating that they "cannot determine the likelihood of loss nor estimate a range of possible loss", and buried way down in the footnotes on page 35, in a totally unrelated section, Marvell added the following language "CMU has alleged that it is entitled to damages in the amount of approximately $735 million through March 2010 as a result of the alleged infringement". Although I admire the wizardy of Marvell's management in being able to bury important information deep in the footnotes of their financial statement, I don't see this as particularly shareholder friendly.

If you read the docket, you will see that the patents in question relate to error-correcting codes for magnetic media. These types of codes are at the heart of Marvell's HD controllers. They are presumably part of what allows Marvell to achieve the high Gigabyte per platter density frequently touted during their conference calls. HD controllers have been Marvell's bread and butter for many years, so this lawsuit goes right to the core of their business.

Long-term, I think Marvell could be a great investment, but I am going to sit it out until December and see how things unfold. The upcoming patent trial and related publicity does not bode well for Marvell's stock price, and I don't think the current share price reflects the risks of this trial. I would also like to see more "color" (as the analysts would put it) around the departure of their CFO.]]> Fri, 19 Oct 2012 17:32:41 -0400
Revenues at Marvell have been basically flat for the past 3 quarters (800M +/- 3%), and the entire industry has been struggling this last quarter. I don't think Marvel's revenue drop alone is enough to justify the departure of their CFO.

I used the departure of their CFO as an excuse to take a deep dive into their most recently filed 10Qs. One thing I noticed was that there were some important changes in their 10Qs related to their upcoming patent trial with CMU on November 27th. Search Marvell's two most recently filed 10Q's for "Carnegie Mellon Litigation", and also take a look at http://bit.ly/VdjBrn

In relation to the CMU litigation, you will notice that in their most recently filed 10Q Marvell removed the language stating that they "cannot determine the likelihood of loss nor estimate a range of possible loss", and buried way down in the footnotes on page 35, in a totally unrelated section, Marvell added the following language "CMU has alleged that it is entitled to damages in the amount of approximately $735 million through March 2010 as a result of the alleged infringement". Although I admire the wizardy of Marvell's management in being able to bury important information deep in the footnotes of their financial statement, I don't see this as particularly shareholder friendly.

If you read the docket, you will see that the patents in question relate to error-correcting codes for magnetic media. These types of codes are at the heart of Marvell's HD controllers. They are presumably part of what allows Marvell to achieve the high Gigabyte per platter density frequently touted during their conference calls. HD controllers have been Marvell's bread and butter for many years, so this lawsuit goes right to the core of their business.

Long-term, I think Marvell could be a great investment, but I am going to sit it out until December and see how things unfold. The upcoming patent trial and related publicity does not bode well for Marvell's stock price, and I don't think the current share price reflects the risks of this trial. I would also like to see more "color" (as the analysts would put it) around the departure of their CFO.]]> http://seekingalpha.com/article/934491/comments?source=feed#comment-10711311 10711311
Revenues at Marvell have been basically flat for the past 3 quarters (800M +/- 3%), and the entire industry has been struggling this last quarter. I don't think Marvel's revenue drop alone is enough to justify the departure of their CFO.

I used the departure of their CFO as an excuse to take a deep dive into their most recently filed 10Qs. One thing I noticed was that there were some important changes in their 10Qs related to their upcoming patent trial with CMU on November 27th. Search Marvell's two most recently filed 10Q's for "Carnegie Mellon Litigation", and also take a look at http://bit.ly/VdjBrn

In relation to the CMU litigation, you will notice that in their most recently filed 10Q Marvell removed the language stating that they "cannot determine the likelihood of loss nor estimate a range of possible loss", and buried way down in the footnotes on page 35, in a totally unrelated section, Marvell added the following language "CMU has alleged that it is entitled to damages in the amount of approximately $735 million through March 2010 as a result of the alleged infringement". Although I admire the wizardy of Marvell's management in being able to bury important information deep in the footnotes of their financial statement, I don't see this as particularly shareholder friendly.

If you read the docket, you will see that the patents in question relate to error-correcting codes for magnetic media. These types of codes are at the heart of Marvell's HD controllers. They are presumably part of what allows Marvell to achieve the high Gigabyte per platter density frequently touted during their conference calls. HD controllers have been Marvell's bread and butter for many years, so this lawsuit goes right to the core of their business.

Long-term, I think Marvell could be a great investment, but I am going to sit it out until December and see how things unfold. The upcoming patent trial and related publicity does not bode well for Marvell's stock price, and I don't think the current share price reflects the risks of this trial. I would also like to see more "color" (as the butt-kissing analysts would put it) around the departure of their CFO.]]> Fri, 19 Oct 2012 16:23:38 -0400
Revenues at Marvell have been basically flat for the past 3 quarters (800M +/- 3%), and the entire industry has been struggling this last quarter. I don't think Marvel's revenue drop alone is enough to justify the departure of their CFO.

I used the departure of their CFO as an excuse to take a deep dive into their most recently filed 10Qs. One thing I noticed was that there were some important changes in their 10Qs related to their upcoming patent trial with CMU on November 27th. Search Marvell's two most recently filed 10Q's for "Carnegie Mellon Litigation", and also take a look at http://bit.ly/VdjBrn

In relation to the CMU litigation, you will notice that in their most recently filed 10Q Marvell removed the language stating that they "cannot determine the likelihood of loss nor estimate a range of possible loss", and buried way down in the footnotes on page 35, in a totally unrelated section, Marvell added the following language "CMU has alleged that it is entitled to damages in the amount of approximately $735 million through March 2010 as a result of the alleged infringement". Although I admire the wizardy of Marvell's management in being able to bury important information deep in the footnotes of their financial statement, I don't see this as particularly shareholder friendly.

If you read the docket, you will see that the patents in question relate to error-correcting codes for magnetic media. These types of codes are at the heart of Marvell's HD controllers. They are presumably part of what allows Marvell to achieve the high Gigabyte per platter density frequently touted during their conference calls. HD controllers have been Marvell's bread and butter for many years, so this lawsuit goes right to the core of their business.

Long-term, I think Marvell could be a great investment, but I am going to sit it out until December and see how things unfold. The upcoming patent trial and related publicity does not bode well for Marvell's stock price, and I don't think the current share price reflects the risks of this trial. I would also like to see more "color" (as the butt-kissing analysts would put it) around the departure of their CFO.]]>