TeleNav 2012 Annual Report Download - page 36

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Table of Contents
We could be adversely affected if domestic or international legislation or regulations are expanded to require changes in our business practices
or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our business. For example, the USA
PATRIOT Act provides certain rights to U.S. law enforcement authorities to obtain personal information in the control of U.S. persons and entities
without notifying the affected individuals. If we are required to allocate significant resources to modify the delivery of our services to enable
enhanced legal interception of the personal information that we transmit and store, our results of operations and financial condition may be adversely
affected.
In addition, because various foreign jurisdictions have different laws and regulations concerning the storage and transmission of personal
information, we may face unknown requirements that pose compliance challenges in new international markets that we seek to enter. Such variation
could subject us to costs, delayed service launches, liabilities or negative publicity that could impair our ability to expand our operations into some
countries and therefore limit our future growth.
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 personal information. These and other privacy concerns could adversely impact our business, results of operations and
financial condition.
If we are unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed.
We rely primarily on a combination of patent laws, trademark laws, copyright laws, trade secrets, confidentiality procedures and contractual
provisions to protect our proprietary technology. However, our issued patents and any future patents that may issue may not survive a legal challenge
to their scope, validity or enforceability, or provide significant protection for us. The failure of our patents to adequately protect our technology might
make it easier for our competitors to offer similar products or technologies. In addition, patents may not issue from any of our current or any future
applications.
Monitoring unauthorized use of our intellectual property is difficult and costly. The steps we have taken to protect our proprietary rights may
not be adequate to prevent misappropriation of our intellectual property. We may not be able to detect unauthorized use of, or take appropriate steps
to enforce, our intellectual property rights. Our competitors may also independently develop similar technology. In addition, the laws of many
countries do not protect our proprietary rights to as great an extent as do the laws of the United States. Any failure by us to meaningfully protect our
intellectual property could result in competitors offering products that incorporate our most technologically advanced features, which could seriously
reduce demand for our navigation services. In addition, we may in the future need to initiate infringement claims or litigation. Litigation, whether we
are a plaintiff or a defendant, can be expensive, time consuming and may divert the efforts of our technical staff and managerial personnel, which
could harm our business, whether or not such litigation results in a determination favorable to us.
Confidentiality agreements with employees and others may not adequately prevent disclosure of our trade secrets and other proprietary
information.
We have devoted substantial resources to the development of our proprietary technology, including the proprietary software components of our
navigation services and related processes. In order to protect our proprietary technology and processes, we rely in part on confidentiality agreements
with our employees, licensees, independent contractors and other advisors. These agreements may not effectively prevent disclosure of our
confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of our confidential information. In
addition, others may independently discover trade secrets and proprietary information, and in such cases we could not assert any trade secret rights
against such parties. Costly and time consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure
to obtain or maintain trade secret protection could adversely affect our competitive business position.
We use open source software in our navigation services platform and client applications and may use more open source software in the future.
Use of open source software may subject our navigation services platform and client applications to general release or require us to re-engineer our
navigation services platform and client applications, which may cause harm to our business. From time to time, there have been claims challenging
the ownership of open source software against companies that incorporate open source software into their products. As a result, we could be subject
to suits by parties claiming ownership of what we believe to be open source software. Some open source licenses contain requirements that we make
available source code for modifications or derivative works we create based upon the open source software and that we license such modifications or
derivative works under the terms of a particular open source license or other license granting third parties certain rights of further use. If we combine
our proprietary software products with open source software in a certain manner, we could, under certain of the open source licenses, be required to
release our proprietary source code. In addition to risks related to license requirements, usage of open source software can lead to greater risks than
use of third party commercial software, as open source licensors generally do not provide warranties or controls on origin of the software. Open
source license terms may be ambiguous and many of the risks associated with usage of open source cannot be eliminated, and could, if not properly
addressed, negatively affect our business. If we were found to have inappropriately used open source software, we may be required to release our
proprietary source code, re-engineer our navigation services platform and client applications, discontinue
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