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Diary Of A Short Seller - QCOM Vs. PRKR

|About: ParkerVision, Inc. (PRKR), Includes: QCOM

Disclosure: I am long PRKR. 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.

DIARY OF A SHORT SELLER

By MoneyMade

Mike Farmwald was author to a recent Seeking Alpha article ("Why The Bulls Are Wrong About Parker Vision") composed about Parker Vision and published on June 14 2012

"I have been short this stock for roughly 9 years…I'm short, purely and simply, because Parker Vision technology is a joke. The IP has little or no value".

- Mike Farwmald/pvnotes (June 14, 2012 on finance.yahoo.com/mb/PRKR/)

It is within this compilation of errant postings by Mike Farmwald that my article takes shape. I would ask, "Why would a person write over 200 articles and emails and distribute them to countless numbers of investors of Parker Vision over the past years? Surely it can't be a personal issue, but what other reason is there for this sole focus that takes the form of a relentless pursuit of just one company? These articles were written even at time when the price share of Parker Vision was under a dollar. What reason is there to go to the extreme lengths that were taken to try and kill this company by, what by all likelihood would seems to be "poising the well" of its investors?

Much has been written about the poor business model of Parker Vision. But with over 16 million + short shares (my last count, may not be accurate) it's important to take the pulse of where shorts get their information. One of the most prolific information suppliers to short hands has been Mike Farmwald. So prolific, but can he be trusted? While in his last article, published 11/18/13 in SA, he noted that "...convincing a non-technical jury doesn't really prove much..." and yet how many of these 16 million short shares would be considered "technically able" to discern the facts in this patent field?

What is surprising to me is that this individual, who posits himself as a person of substance that market players should listen to has written multiple miscalculations in each and every article he has written. Here are only 22 examples of over 200 that are all publicly available and thereby easily verifiable. Again I ask the question -what is really behind this effort to discredit a tech company.

Chapter I: The Lawsuit Against Qualcomm Is Baseless

I…don't understand how this lawsuit will get very far."

- Mike Farmwald/pvnotes (July 22, 2011 on www.pvnotes.com/pv-summary)

"I really find it hard to believe Jeff thinks the lawsuit will go anywhere…In the medium term (6-18 months) it will prove, quite publicly, that the ParkerVision patent portfolio is worthless."

- Mike Farmwald/pvnotes (August 15, 2011 on finance.yahoo.com/mb/PRKR/)

"ParkerVision's patent claims against Qualcomm can easily be shown to be meritless."

- Mike Farmwald/pvnotes (February, 20 2013 on www.pvnotes.com/pv-summary)

REALITY • The case survived summary judgment (which was not even a case dispositive motion for summary judgment to begin with), and the case went to trial in October 2013.

Chapter II: Qualcomm Doesn't Infringe

The patents I've looked at…don't read on anything Qualcomm has built."

- Mike Farmwald/pvnotes (July 21, 2011 on finance.yahoo.com/mb/PRKR/)

"I can't see any possible infringement on these named patents from the claimed Qualcomm products".

- Mike Farmwald/pvnotes (July 22, 2011 on www.pvnotes.com/pv-summary)

"One only needs to look at ParkerVision claims to understand why they are not infringed by Qualcomm."

- Mike Farmwald/pvnotes (July 22, 2011 on finance.yahoo.com/mb/PRKR/)

"In no real sense to Qualcomm use D2D."

- Mike Farmwald/pvnotes (June 13, 2012 on finance.yahoo.com/mb/PRKR/)

"I'm pretty convinced … that QCOM will win the Markman ruling sufficiently to be able to win motions of summary judgment of non-infringement on all claims - thus no trial."

- Mike Farmwald/pvnotes (September 14, 2012 on finance.yahoo.com/mb/PRKR/)

REALITY • In October 2013, an Orlando jury ruled, unanimously, that all 11 of the asserted claims in all 4 of the Parker Vision patents-in-suit are infringed by all 19 of the accused Qualcomm products. Qualcomm did not even call an expert witness for non-infringement

Chapter III: The Patents Are Invalid Due To Massive Amounts of Prior Art

"Anyone who knows about RF would know about the massive amounts of prior art for the Parker Vision patents & would feel offended that the patents even issued."

- Mike Farmwald/pvnotes (November 19, 2012 on finance.yahoo.com/mb/PRKR/)

"There is a huge amount of prior art on passive mixers."

- Mike Farmwald/pvnotes (February 20, 2013 on www.pvnotes.com/pv-summary)

"Parker Vision claims are clearly not valid under the Markman definitions, due to very straightforward prior art."

- Mike Farmwald/pvnotes (February 21, 2013 on finance.yahoo.com/mb/PRKR/)

REALITY • In October 2013, an Orlando jury ruled, unanimously, that all 11 of the asserted claims in all 4 of the Parker Vision patents-in-suit are not invalid.

Chapter IV: Parker Vision Will Lose The Markman

"I'm pretty sure Qualcomm should win claim construction on [n=1] on the merits."

- Mike Farmwald/pvnotes (June 13, 2012 on finance.yahoo.com/mb/PRKR/)

"The Markman hearing went very poorly for PRKR."

- Mike Farmwald/pvnotes (August 26, 2012 on finance.yahoo.com/mb/PRKR/)

"Everyone I have talked to agrees that Qualcomm won [the Markman], and on nearly all points they (NASDAQ:QCOM) won handily"

- Mike Farmwald/pvnotes (August 26, 2012 on finance.yahoo.com/mb/PRKR/)

"I'm pretty convinced (having hired people to both read the patents, the briefings and attend the hearing) that QCOM will win the Markman ruling sufficiently to be able to win motions of summary judgment of non-infringement on all claims - thus no trial."

- Mike Farmwald/pvnotes (September 14, 2012 on finance.yahoo.com/mb/PRKR/)

"We've done a pretty thorough analysis …and feel fairly confident that Qualcomm will win most of the contested claim construction arguments."

- Mike Farmwald/pvnotes (September 27, 2012 on www.pvnotes.com/pv-summary)

REALITY • In the Markman Order issued by The Court on February 20, 2013, The Court adopted Parker Vision's proposed definitions for 41 out of 44 disputed terms, including "n=1" (Document 243)

Chapter V: Even If Parker Vision Wins, Past Damages Will Be Well Below $100M

"All past damages would amount to $30M for the entire judgment."

- Mike Farmwald/pvnotes (February 27, 2013 on finance.yahoo.com/mb/PRKR/)

"I was too generous to PRKR. The scenario I outlined would results in a $3M judgment."

- Mike Farmwald/pvnotes (February 27, 2013 on finance.yahoo.com/mb/PRKR/)

"The highest possible [past damages] number is $72M."

- Mike Farmwald/pvnotes (March 21, 2013 on finance.yahoo.com/mb/PRKR/)

"Multiplying all of the probabilities, one gets expected total damages (the *value*) for the ParkerVision v. Qualcomm lawsuit of $6.1M"

- Mike Farmwald/pvnotes (March 21, 2013 on finance.yahoo.com/mb/PRKR/)

"One-sixtieth of $700M is $11.7M, about what I calculate to be the expected value of the lawsuit."

- Mike Farmwald/pvnotes (March 22, 2013 on finance.yahoo.com/mb/PRKR/)

"These reduce the maximum potential damages…to under $30M."

- Mike Farmwald (April 7, 2013 on seekingalpha.com/article/1331301-parkerv...) finance.yahoo.com/mb/PRKR/)

"The damages (as I have explained over and over) will be will under $50M."

- Mike Farmwald/pvnotes (April 12, 2013 on finance.yahoo.com/mb/PRKR/)

REALITY • The Jury Awarded Parker Vision Past Damages Of $172.7m

I'll end this short compilation by asking the question again, "What is the motive for any person to be so relentless and so wrong for so long?" Remember, this compilation was brief by choice. Only 22 examples were cited out of over 200 that were available. Ask yourself the next time you read an article by this individual what might be the real reason he is writing this?

"To what end" is a cultural adage, and becomes oft-quoted question that many believe applies to this author.

Disclosure: I am long PRKR. 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.