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Message: DM Timeline

DM Timeline

posted on Oct 04, 2007 01:35PM

The passage of time occurs slower on Agora than it does in the physical world, thus what seems likes ages here is really only a matter of a few weeks or months on the outside. Let’s ponder that a bit...

"On March 23, 2007 e.Digital Corporation (the "Company") entered into an agreement for legal services and contingent fee arrangement ("Agreement") with Duane Morris LLP."

No doubt that by the time this agreement was signed, DM had already done fairly extensive due diligence as to e.Digital’s IP and was probably "on-board" well before March 23rd, but we’ll just use this date since it’s the best we have.

On September 7, 2007, DM officially filed suit against Vivitar. So it took them 5 ½ months to file the first action. It’s reasonable to conclude (though without any certainty) that *** = Vivitar (from the DM agreement where something like: ‘The first target is contemplated to be ***’ was stated). My point is that they went from just knowing about Vivitar to filing action against them in about 6 months time. But aside from those factors which were specific to Vivitar’s case, I would assume that they did plenty of in-depth analysis and general prep work which would apply to any other company on their list. I’d say that an 80/20 type of rule should apply here.

Now it was only not quite a month ago that DM first filed. How long should it take them to prepare the specifics for the next action? If an 80/20 rule applies, then the answer could be 1-2 months - so we might expect to see another filing just any day now. That assumes a lot of things including not wanting to wait for the initial reaction or result from Vivitar first and that the next target is at about the same level of complexity. So with such concepts in mind, let’s give them 3 months - or about half the time it took them to file the first lawsuit. With that I think we’ll see at least one more filing by early December or before the end of the year at the latest.

I also believe I’m being very conservative here since I think that DM’s intent should be to act as swiftly as possible for two reasons: 1) They’re doing this on contingency and there’s absolutely no value in dragging the process out any longer than necessary, and 2) The changing climate regarding patent decisions and legislation which is apparently making things less favorable for the plaintiff.

I also haven’t forgotten statements made here with respect to DM changing its strategy toward going after larger companies and/or potential licenses sooner rather than later. No doubt it will take more time to prepare such actions but I would still think that much of the general work has already been done. It’s quite likely in my view that there could be another filing yet this month, and if not, then very soon thereafter.

One final thought is that at some point, they’ll probably have to switch to rapid-fire and sue several companies together or in quick succession. That’s when I think the news will spread, emotion will kick in, and we’ll finally see a very positive impact on the share price. Before mid-2008 perhaps?

Question regarding the digEcor suit: How do we know a pretrial hearing is scheduled in October? I don’t recall a filing aside from the one that stated a date of 8/22/07 - which was apparently delayed until this month? Is there another filing out there and/or do we know the specific date in October? TIA.

- Sinkman

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