Vringo, Inc. : VRINGO ANNOUNCES RULING IN I/P ENGINE LITIGATION
NEW YORK - August 16, 2013 - Vringo, Inc. (NASDAQ: VRNG), a company engaged in
the innovation, development and monetization of intellectual property and
mobile technologies, today announced the District Court has issued a ruling on
its wholly-owned subsidiary I/P Engine, Inc.'s Motion for an Award of
Post-Judgment Royalties in its litigation against AOL, Inc., Google, Inc., IAC
Search & Media, Inc., Gannett Company, Inc., and Target Corporation
The District Court's Memorandum Opinion and Order (the "Order") is available
online at http://bit.ly/1bDBHNk, and the following summary is qualified in its
entirety by the full text of the Order.
In the Order, the District Court found that I/P Engine is entitled to an award
of a post-judgment royalty, and that additional discovery and briefing is
necessary to determine the precise amount of the royalty.
The District Court noted that at trial, I/P Engine introduced expert testimony
that starting in the Fourth Quarter of 2007, the infringing components of
Google's SmartAds system added 20.9% to Google's U.S. AdWords revenue and
additional evidence is in the record to support this position. While
Defendants continue to contest the use of this royalty base, the Court noted
that it will not re-litigate this question, and held that it will apply the
20.9% royalty base to determine the proper ongoing royalty.
The District Court ordered Defendants to pay the ongoing royalty to I/P Engine
on a quarterly basis by wire transfer or other certified means of receipt, and
certify by penalty of perjury the U.S. revenue attributable to Defendants' use
of AdWords in U.S. Dollars and the calculation of the royalty payment.
To resolve the ongoing royalty rate and duration for which the royalty rate
shall be received, the Court set forth the following discovery and briefing
*August 25, 2013 - The parties must produce any documents relevant for
determining whether "New AdWords" is no more than a colorable variation of
the adjudicated product.
*September 25, 2013 - Expert witness reports due.
*October 15, 2013 - Expert rebuttal reports due.
*October 30, 2013 - The parties shall serve and file briefs and any
*November 10, 2013 - The parties may file responsive briefs.
*Evidentiary Hearing - The Court, if necessary, may schedule an evidentiary
hearing in which the parties may present appropriate evidence and offer
arguments in support.
The District Court also held that the parties should be given the opportunity
to set their own royalty rate before the Court imposes one. To that end, the
District Court ordered that within five days of completing the aforementioned
discovery and briefing schedule, the parties meet and negotiate an appropriate
ongoing royalty rate, using 20.9% of U.S. AdWords revenues as the appropriate
royalty base. If the parties are unable to come to an agreement, the District
Court further ordered that the parties schedule a settlement conference with
the United States Magistrate Judge assigned to the case no later than December
On November 6, 2012, a jury in U.S. District Court in Norfolk, Virginia ruled
in favor of I/P Engine and against the defendants with respect to the
defendants' infringement of the asserted claims of U.S. Patent Nos. 6,314,420
and 6,775,664. After upholding the validity of the patents-in-suit, and
determining that the asserted claims of the patents were infringed by the
defendants, the jury found that reasonable royalty damages should be based on
a "running royalty," and that the running royalty rate should be 3.5%. The
jury also awarded I/P Engine a total of approximately $30.5 million, excluding
interest. On November 20, 2012, the clerk entered the District Court's final
On August 1, 2013, the District Court found that I/P Engine is entitled to
supplemental damages from October 1, 2012 to November 20, 2012; prejudgment
interest from September 15, 2011 to November 20, 2012; and post-judgment
interest for Defendants' infringement. The District Court held that it will
determine the amounts for each of the foregoing.
I/P Engine and Defendants have appealed the case to the Court of Appeals for
the Federal Circuit. Defendants filed their opening brief on July 22, 2013.
I/P Engine's brief is due on September 3, 2013.
Google has submitted requests to the United States Patent and Trademark Office
(the "USPTO") for ex parte reexamination of certain claims of the two asserted
patents. On July 24, 2013, the USPTO issued a notice that it will issue a
certificate confirming that all of the claims in the '420 patent challenged by
Google remain valid and unchanged. The '664 patent remains subject to
The court dockets for the cases are publicly available on the Public Access to
Court Electronic Records website, http://www.pacer.gov, which is operated by
the Administrative Office of the U.S. Courts. The U.S. District Court
proceedings are pending in the Eastern District of Virginia, Norfolk
Division. The case number is 2:11cv512RAJ. Appellate proceedings are pending
in the United States Court of Appeals for the Federal Circuit. The docket
numbers are 13-1307 and 13-1311. Documents regarding the USPTO proceedings
are publicly available on the Patent Application Information Retrieval
About Vringo, Inc.
Vringo, Inc. is engaged in the innovation, development and monetization of
intellectual property and mobile technologies. Vringo's intellectual property
portfolio consists of over 500 patents and patent applications covering
telecom infrastructure, internet search, and mobile technologies. The patents
and patent applications have been developed internally, and acquired from
third parties. Vringo operates a global platform for the distribution of
mobile social applications and services. For more information, visit:
This press release includes forward-looking statements, which may be
identified by words such as "believes," "expects," "anticipates," "estimates,"
"projects," "intends," "should," "seeks," "future," "continue," or the
negative of such terms, or other comparable terminology. Forward-looking
statements are statements that are not historical facts. Such forward-looking
statements are subject to risks and uncertainties, which could cause actual
results to differ materially from the forward-looking statements contained
herein. Factors that could cause actual results to differ materially include,
but are not limited to: our inability to license and monetize our patents,
including the outcome of the litigation against online search firms and other
companies; our inability to monetize and recoup our investment with respect to
patent assets that we acquire; our inability to develop and introduce new
products and/or develop new intellectual property; new legislation,
regulations or court rulings related to enforcing patents, that could harm our
business and operating results; unexpected trends in the mobile phone and
telecom infrastructure industries; our inability to raise additional capital
to fund our combined operations and business plan; our inability to maintain
the listing of our securities on NASDAQ; the potential lack of market
acceptance of our products; potential competition from other providers and
products; our inability to retain key members of our management team; and
other risks and uncertainties and other factors discussed from time to time in
our filings with the Securities and Exchange Commission ("SEC"), including our
annual report on Form 10-K for the year ended December 31, 2012 filed with the
SEC on March 21, 2013. Vringo expressly disclaims any obligation to publicly
update any forward-looking statements contained herein, whether as a result of
new information, future events or otherwise, except as required by law.
Investors and Media:
Executive Vice President
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applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of
information contained therein.
Source: Vringo, Inc. via Thomson Reuters ONE
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