eTrade 2011 Annual Report Download - page 23

ITEM 2. PROPERTIES
A summary of our significant locations at December 31, 2011 is shown in the following table. All facilities
are leased, except for 165,000 square feet of our office in Alpharetta, Georgia. Square footage amounts are net of
space that has been sublet or part of a facility restructuring.
Location Approximate Square Footage
Alpharetta, Georgia 260,000
Arlington, Virginia 119,000
Jersey City, New Jersey 107,000
Menlo Park, California 91,000
Sandy, Utah 66,000
New York, New York 39,000
Chicago, Illinois 25,000
All of our facilities are used by either our trading and investing or balance sheet management segments, in
addition to the corporate/other category. All other leased facilities with space of less than 25,000 square feet are
not listed by location. In addition to the significant facilities above, we also lease all 28 E*TRADE branches,
ranging in space from approximately 2,500 to 7,000 square feet. We believe our facilities space is adequate to
meet our needs in 2012.
ITEM 3. LEGAL PROCEEDINGS
On October 27, 2000, Ajaxo, Inc. (“Ajaxo”) filed a complaint in the Superior Court for the State of
California, County of Santa Clara. Ajaxo sought damages and certain non-monetary relief for the Company’s
alleged breach of a non-disclosure agreement with Ajaxo pertaining to certain wireless technology that Ajaxo
offered the Company as well as damages and other relief against the Company for their alleged misappropriation
of Ajaxo’s trade secrets. Following a jury trial, a judgment was entered in 2003 in favor of Ajaxo against the
Company for $1.3 million for breach of the Ajaxo non-disclosure agreement. Although the jury found in favor of
Ajaxo on its claim against the Company for misappropriation of trade secrets, the trial court subsequently denied
Ajaxo’s requests for additional damages and relief. On December 21, 2005, the California Court of Appeal
affirmed the above-described award against the Company for breach of the nondisclosure agreement but
remanded the case to the trial court for the limited purpose of determining what, if any, additional damages
Ajaxo may be entitled to as a result of the jury’s previous finding in favor of Ajaxo on its claim against the
Company for misappropriation of trade secrets. Although the Company paid Ajaxo the full amount due on the
above-described judgment, the case was remanded back to the trial court, and on May 30, 2008, a jury returned a
verdict in favor of the Company denying all claims raised and demands for damages against the Company.
Following the trial court’s filing of entry of judgment in favor of the Company on September 5, 2008, Ajaxo filed
post-trial motions for vacating this entry of judgment and requesting a new trial. By order dated November 4,
2008, the trial court denied these motions. On December 2, 2008, Ajaxo filed a notice of appeal with the Court of
Appeal of the State of California for the Sixth District. Oral argument on the appeal was heard on July 15, 2010.
On August 30, 2010, the Court of Appeal affirmed the trial court’s verdict in part and reversed the verdict in part,
remanding the case. E*TRADE petitioned the Supreme Court of California for review of the Court of Appeal
decision. On December 16, 2010, the California Supreme Court denied the Company’s petition for review and
remanded for further proceedings to the trial court. On September 20, 2011, the trial court granted limited
discovery at a conference on November 4, 2011, and set a motion schedule and trial date. The trial will continue
on May 14, 2012. The Company will continue to defend itself vigorously.
On October 2, 2007, a class action complaint alleging violations of the federal securities laws was filed in
the United States District Court for the Southern District of New York against the Company and its then
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