Orbitz 2009 Annual Report Download - page 21

Travel companies have also been subjected to investigations, lawsuits and adverse publicity due to
allegedly improper disclosure of passenger information. As privacy and data protection have become more
sensitive issues, we may also become exposed to potential liabilities as a result of differing views on the
privacy of travel data. These and other privacy concerns, including security breaches, could adversely impact
our business, financial condition and results of operations.
We are exposed to risks associated with online commerce security and credit card fraud.
The secure transmission of confidential information over the Internet is essential in maintaining customer
and supplier confidence in our services. Substantial or ongoing security breaches, whether instigated internally
or externally on our system or other Internet-based systems, could significantly harm our business. We
currently require customers to guarantee their transactions with their credit cards online. We rely on licensed
encryption and authentication technology to effect secure transmission of confidential customer information,
including credit card numbers. It is possible that advances in computer capabilities, new discoveries or other
developments could result in a compromise or breach of the technology that we use to protect customer
transaction data.
We incur substantial expense to protect against and remedy security breaches and their consequences.
However, our security measures may not prevent security breaches. We may be unsuccessful in implementing
our remediation plan to address these potential exposures. A party (whether internal, external, an affiliate or
unrelated third party) that is able to circumvent our security systems could steal proprietary information or
cause significant interruptions in our operations. Security breaches also could damage our reputation and
expose us to a risk of loss or litigation and possible liability. Security breaches could also cause customers and
potential customers to lose confidence in our security, which would have a negative effect on the demand for
our products and services.
Moreover, public perception concerning security and privacy on the Internet could adversely affect
customers’ willingness to use our websites. A publicized breach of security, even if it only affects other
companies conducting business over the Internet, could inhibit the growth of the Internet and, therefore, our
services as a means of conducting commercial transactions.
We are involved in various legal proceedings and may experience unfavorable outcomes, which could harm us.
We are involved in various legal proceedings, including, but not limited to, actions relating to intellectual
property, in particular patent infringement claims against us, tax matters, employment law and other
negligence, breach of contract and fraud claims, that involve claims for substantial amounts of money or for
other relief or that might necessitate changes to our business or operations. The defense of these actions may
be both time consuming and expensive. If any of these legal proceedings were to result in an unfavorable
outcome, it could have a material adverse effect on our business, financial position and results of operations.
We may not protect our intellectual property effectively, which would allow competitors to duplicate our
products and services. This could make it more difficult for us to compete with them.
Our success and ability to compete depend, in part, upon our technology and other intellectual property,
including our brands. Among our significant assets are our software and other proprietary information and
intellectual property rights. We rely on a combination of copyright, trademark and patent laws, trade secrets,
confidentiality procedures and contractual provisions to protect these assets. However, we have a limited
number of patents, and our software and related documentation are protected principally under trade secret and
copyright laws, which afford only limited protection, and the laws of some jurisdictions provide less protection
for our proprietary rights than the laws of the U.S. We have granted Travelport an exclusive license to our
supplier link technology, including our patents related to that technology. Under the exclusive license,
Travelport has the first right to enforce those patents, and so we will only be able to bring actions to enforce
those patents if Travelport declines to do so. Unauthorized use and misuse of our intellectual property could
have a material adverse effect on our business, financial condition and results of operations, and the legal
remedies available to us may not adequately compensate us for the damages caused by unauthorized use.
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