So why the sell off: People are disappointed in the numbers and frustrated with the NDA and throwing in the towel. So lets break those issues down.

Disappointment with the numbers is the result of artificial expectations based on speculation. IMO there is no way the 10Q includes all the numbers for the J3. I believe we either have royalty payments coming in, which are obviously not all going to be included in the 10Q, or some sort of other payment structure that is not reflected in this 10Q. It is beyond comprehension that we would have agreed to take it in the shorts on the eve of trial after years of litigation during which some of the top tech companies on the planet agreed to settle with us and after a favorable Markman - impossible. If you are with me so far, then we still had over 6 million net income in 3 months. If that does not include J3 numbers or only a small part of J3 numbers then how could anyone be disappointed in that.

So the real problem is frustration with the NDA, a frustration that I fully share. Final settlement with the J3 was a milestone event for PTSC and us shareholders are left having to try and figure out for ourselves what happened. When we are forced to speculate, we are setting ourselves up for disappointment. I dont like it, however, the point I keep coming back to is that the stricter PTSC is about the confidentiality, the better the deal must have been. IMO there is no way the NDA was requested by us. Confidentiality is almost always requested by the defendant or payor in a lawsuit. In 17 years as a litigator I have never been involved in lawsuit where settlement terms were requested to be confidential by the Plaintiff; I have been involved in several where it was requested by the Defendant. So what does that tell you: It tells me the terms were so good for us that Defendants demanded it be confidential so they dont look like schmucks - they held out to the bitter end and it cost them. If they went forward with trial they were at risk of being hit with treble (3x) damages and attorney fees so there was a lot of room to pay more then anyone else had and still reduce the exposure they had at trial.

It is possible that the settlment is so unconvential, i.e. contingent on other events, that PTSC wanted confidentiality out of concern for how it would be perceived by the shareholders. However, even in that situation PTSC must not have been too concerned about the contingencies and the ultimate payoff would still have to be worth the obvious negative effect of the confidentiality. As set forth above, I refuse to accept that PTSC would have agreed to a bad deal.

Bottom line is I still believe the company is in a much better position now then it was in before the J3 settlment, I just wish I knew the details. At some point the details will be known, unitl then we still have money in the bank, we are still focused on the right M&A and are still pursuing infringers. As such, I am staying put and may even pick up some more shares on the cheap.