Moore v TPL

TPL's threat is this: I've agreed not to interfere with the licensing program. And I certainly don't intend to.

Our agreement stipulates that disputes be resolved by Arbitration. But Leckrone claims that exercising that right would interfere. So I have no legal recourse? I don't think our justice system works that way.

So I'll try to defend my rights. And outline here some of the issues

Royalty Payments

Given the amazing level of interest, I feel obliged to discuss the issue that prompted this posting. I didn't ask to become rich and don't like to whine about not being rich enough. But I won't be cheated.

The situation is that Dan Leckrone (TPL) has refused to pay me the royalties specified in our contract. He is spending millions each month, of which I get zip. Unfortunately, the proceeds are paid to him and he exerts full control. I've argued with him for years, the last 9 months thru my lawyers.

Income

The last payment I received was in July 2008. Since then he's boasted of another $1M in licenses. A review of my records indicates that I've received $11M over the last 5 years. I invested most of this money in residential real estate:

· My former residence in the Sierra, now my cabin

· A house in Central California for my son

· A marvelous house I'm building at Lake Tahoe

To do this, I relied on an income stream. My liquid reserves are almost exhausted and I'm pressed to fulfill my obligations. I'd like to keep spending and thus stimulate the economy. And I still need to support the SEAForth project.

Commercialization Agreement

Patriot Scientific and I own what is called the Moore Microprocessor Portfolio; a set of 7 US patents and 15 foreign versions. We each own 50%.

My agreement with TPL is complicated. Basically, I hired him to license and enforce the MMP patents. He was to receive 45% of the proceeds; that is, 45% of my 50%. Leckrone made a deal (2" thick) with Patriot that included 15% off the top for expenses.

I agreed to a deduction of 11% for TPL's investors. And he agreed to fund 45% of the SEAForth chip development project. So my share is reduced from 55% to 49.5% and further reduced by 55% of SEAForth expenses. He terminated SEAForth in January 2009, so that deduction is gone.

Leckrone has commingled funds in such a way the SEAForth expenses are hard to determine; perhaps $40M. They're mixed up with the expenses of other TPL projects. He has used this confusion to charge me arbitrary allocations for a plethora of expenses. This is the subject of an on-going audit.

Audit

My audit of TPL has documented MMP revenue of $260M. My 25% would be $65M. Deducting $25M for SEAForth expenses leaves $40M of which I've been paid $10M. So $30M is unaccounted for. I conclude that TPL owes me at least $20M of which he admits to $6M.

These numbers will be refined and documented, but the conclusion will not change much. Massive unacknowledged debt.

Leckrone can resolve this issue at any time by agreeing to what he owes me and arranging to pay it. Else a court will decide.

Here are two graphs of my royalty stream. The first is actual royalties received thru 2008. The white bars show 8% of what TPL received, which amounts to $11M.

The second shows what the Agreement says I should have received, 60 days after TPL received it. White indicates 40%. What a rip-off.

http://74.125.155.132/search?q=cache:http://www.colorforth.com/royalty.htm

Claim 29 is patentable as amended. MMP lives!

Commercialization Agreement

This is the Agreement I signed in 2003, when I was still young and naive. I would not sign such a thing now.

I am posting it to explain the references in those portions that Leckrone made public when he recorded them with USPTO. They are here and here as referenced elsewhere.

I had known Leckrone for 15 years. I thought he was my friend; that our interests were aligned; that I could trust both him and his judgement. I was wrong.

I'm not a lawyer, but this contract is bad. It's verbose, complicated, redundant and probably inconsistent. It doesn't say what it means or mean what it says. It requires adjudication, which is what a contract is supposed to avoid.

Annotated Commercialization Agreement

This is the ComAg annotated to indicate my understanding of it.

UCC-1 Form

UCC-1 is a document filed with California Secretary of State indicating my interest in the MMP portfolio. It merely insures that any interested party knows of this. This filing is explicitly allowed by the ComAg.