Support.com 2007 Annual Report Download - page 33

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proposed issuer settlement was held on April 24, 2006. The district court took the matter under submission. Meanwhile the consolidated case against the
underwriters has proceeded. On October 13, 2004, the district court certified a class in the underwriters' proceeding. On December 5, 2006, however, the Second
Circuit reversed, holding that the proposed class could not be certified, and denied a petition for rehearing on April 6, 2007. On June 25, 2007, the district court
entered a stipulated order terminating the proposed issuer settlement. Plaintiffs are proceeding with discovery as to underwriters and as to six issuers not
including the Company, in focus or test cases that do not name the Company as a defendant. Briefing is in progress for a new class certification motion, which is
expected to be heard in 2008. While we cannot predict with certainty the outcome of the litigation or whether the settlement will be approved, we believe we and
our officers have meritorious defenses to the claims in the litigation.
We are also subject to other routine legal proceedings, as well as demands, claims and threatened litigation, that arise in the normal course of our business,
including assertions that we may be infringing patents or other intellectual property rights of others. We currently believe that the ultimate amount of liability, if
any, for any pending claims of any type (alone or combined) will not materially affect our financial position, results of operations or cash flows. The ultimate
outcome of any litigation is uncertain, however, and either unfavorable or favorable outcomes could have a material negative impact on our financial condition
and operating results. Regardless of outcome, litigation can have an adverse impact on us because of defense costs, negative publicity, diversion of management
resources and other factors.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of security holders during the fourth quarter of the year ended December 31, 2007.
29
Source: SUPPORTSOFT INC, 10-K, March 13, 2008