With respect to oversight & control/auditing, one thing about the arrangement that bothers me is that TPL gets to charge from what I can tell, what it wants for the licensing legwork / legal fees. Of the $16.3M spent this fiscal year, a large part presumably has gone to TPL. So from that standpoint, the agreement is a Win-Win for them. They collect on all of their fees/profit for the legal/licensing side, and then they split the resultant license fees. Not necessarily a double dip per se, but they have no down side in the agreement since they get paid coming and going.

Do you know if there are any audit controls, or ability for PTSC to reign in TPL with respect the the expenses side of the licensing effort? While I don't want to suggest TPL is doing such a thing, I'm wondering if there is anything in the agreement that would, for example, prevent TPL/Alliacense from hiring someone for $20/hr, and then bill them to the licensing effort at $300/hr, utilize them in that effort more than is required, and then collect on all those fees, then turn around and get half of the net profit of the license on top of that fee structure. In this exagerated example, (or in the FY08 financials to date), rather than the 50/50 split that is the spirit of the agreement, TPL can in reality get more lik 60/40 or 70/30.

Though I'm sure a large part of the expenses went to Roger Cook & his team, I'll ignore that for now to illustrate my point to the extreme, MMP has commanded in round numbers $49M in FY08. Of that $16M was expenses for licensing efforts. That leaves $33M for TPL & PTSC to split. If all $16M of the expenses go to TPL's licensing efforts and they get another $16.5M from the profits, then TPL in essence gets $32.5M to PTSC's $16.5M or 67% to 33%.

Are you aware of any oversight or controls in the agreement that prevent this, and/or remedy this if it were to happen?