Autodesk 2010 Annual Report Download - page 114

We may face intellectual property infringement claims that could be costly to defend and result in our loss of
significant rights.
As more software patents are granted worldwide, the number of products and competitors in our industry
segments grow and the functionality of products in different industry segments overlap, we expect that software
product developers will be increasingly subject to infringement claims. Infringement or misappropriation claims
have in the past been, and may in the future be, asserted against us, and any such assertions could harm our
business. Additionally, certain patent holders without products have become more aggressive in threatening and
pursuing litigation in attempts to obtain fees for licensing the right to use patents. Any such claims or threats,
whether with or without merit, have been and could in the future be time-consuming to defend, result in costly
litigation and diversion of resources, cause product shipment delays or require us to enter into royalty or
licensing agreements. In addition, such royalty or license agreements, if required, may not be available on
acceptable terms, if at all, which would likely harm our business.
A breach of security in our products or computer systems may compromise the integrity of our products, harm
our reputation, create additional liability and adversely impact our financial results.
We make significant efforts to maintain the security and integrity of our product source code and computer
systems. There appears to be an increasing number of computer “hackers” developing and deploying a variety of
destructive software programs (such as viruses, worms, and the like) that could attack our products and computer
systems. Despite significant efforts to create security barriers to such programs, it is virtually impossible for us to
entirely mitigate this risk. Like all software products, our software is vulnerable to such attacks. The impact of
such an attack could disrupt the proper functioning of our software products, cause errors in the output of our
customers’ work, allow unauthorized access to sensitive, proprietary or confidential information of ours or our
customers and other destructive outcomes. If this were to occur, our reputation may suffer, customers may stop
buying our products, we could face lawsuits and potential liability and our financial performance could be
negatively impacted.
While we believe we currently have adequate internal control over financial reporting, we are required to
evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002
and any adverse results from such evaluation could result in a loss of investor confidence in our financial
reports and have an adverse effect on our stock price.
Pursuant to Section 404, we are required to furnish a report by our management on our internal control over
financial reporting. The report contains, among other matters, an assessment of the effectiveness of our internal
control over financial reporting as of the end of our fiscal year, including a statement as to whether or not our
internal control over financial reporting is effective. This assessment must include disclosure of any material
weaknesses in our internal control over financial reporting identified by management.
While we have determined in our Management Report on Internal Control over Financial Reporting,
included in this Annual Report on Form 10-K, that our internal control over financial reporting was effective as
of January 31, 2010, we must continue to monitor and assess our internal control over financial reporting. If our
management identifies one or more material weaknesses in our internal control over financial reporting and such
weakness remains uncorrected at fiscal year end, we will be unable to assert such internal control is effective at
fiscal year end. If we are unable to assert that our internal control over financial reporting is effective at fiscal
year-end (or if our independent registered public accounting firm is unable to express an opinion on the
effectiveness of our internal controls or concludes that we have a material weakness in our internal controls), we
could lose investor confidence in the accuracy and completeness of our financial reports, which would likely
have an adverse effect on our business and stock price.
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