Citrix 2009 Annual Report Download - page 33

use, we may not remain competitive. Any patents owned by us could be invalidated, circumvented or challenged.
Any of our pending or future patent applications, whether or not being currently challenged, may not be issued
with the scope we seek, if at all, and if issued, may not provide any meaningful protection or competitive
advantage.
In addition, our ability to protect our proprietary rights could be affected by:
•Differences in International Law; Enforceability of Licenses: The laws of some foreign countries do
not protect our intellectual property to the same extent as do the laws of the United States and Canada.
For example, we derive a significant portion of our sales from licensing our packaged products under
“shrink wrap” or “click-to-accept” license agreements that are not signed by licensees and electronic
enterprise customer licensing arrangements that are delivered electronically, all of which could be
unenforceable under the laws of many foreign jurisdictions in which we license our products.
•Third-Party Infringement Claims: We may become increasingly subject to infringement claims and
claims alleging the unauthorized use of a third-party’s code in our products. This may occur for a
variety of reasons, including the expansion of our product lines, such as our Datacenter and Cloud
Solutions and our Online Services division products, through product development and acquisitions
and an increase in patent infringement litigation commenced by non-practicing entities, the increase in
the number of competitors in our industry segments and the resulting increase in the number of related
products and the overlap in the functionality of those products, and the unauthorized use of third-
party’s code in our product development process. Companies and inventors are more frequently
seeking to patent software despite recent developments in the law that may discourage or invalidate
such patents. As a result, we could receive more patent infringement claims. Responding to any
infringement claim, regardless of its validity, could result in costly litigation or injunctive relief or
require us to obtain a license to intellectual property rights of those third parties. Licenses may not be
available on reasonable terms, on terms compatible with the protection of our proprietary rights, or at
all. In addition, attention to these claims could divert our management’s time and attention from
developing our business. If a successful claim is made against us and we fail to develop or license a
substitute technology or negotiate a suitable settlement arrangement, our business, results of
operations, financial condition and cash flows could be materially and adversely affected. See Part I,
Item 3 entitled “Legal Proceedings” for information concerning pending patent infringement cases in
which we are involved.
Our use of “open source” software could negatively impact our ability to sell our products and subject us to
possible litigation.
The products or technologies acquired, licensed or developed by us may incorporate so-called “open source”
software, and we may incorporate open source software into other products in the future. Such open source
software is generally licensed by its authors or other third parties under open source licenses, including, for
example, the GNU General Public License, the GNU Lesser General Public License, “Apache-style” licenses,
“Berkeley Software Distribution,” “BSD-style” licenses, and other open source licenses. We monitor our use of
open source software in an effort to avoid subjecting our products to conditions we do not intend. Although we
believe that we have complied with our obligations under the various applicable licenses for open source
software that we use such that we have not triggered any of these conditions, there is little or no legal precedent
governing the interpretation of many of the terms of these types of licenses. As a result, the potential impact of
these terms on our business may result in unanticipated obligations regarding our products and technologies, such
as requirements that we offer our products that use the open source software for no cost, that we make available
source code for modifications or derivative works we create based upon, incorporating or using the open source
software, and/or that we license such modifications or derivative works under the terms of the particular open
source license.
If an author or other third party that distributes open source software were to allege that we had not
complied with the conditions of one or more of these licenses, we could be required to incur significant legal
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