Plantronics 2001 Annual Report Download - page 23

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8. Commitments and Contingencies
Minimum Future Rental Payments. We lease certain equipment and facilities under operating
leases expiring in various years through and after 2006. Minimum future rental payments
under non-cancelable operating leases having remaining terms in excess of one year as of
March 31, 2001:
(in thousands) Amount
Fiscal Year Ending March 31,
2002 $ 1,702
2003 1,607
2004 1,583
2005 1,248
2006 414
Thereafter 3,609
Total minimum future rental payments $10,163
Rent expense for operating leases was approximately $1.1 million in fiscal 1999, $1.1 million
in fiscal 2000 and $1.8 million in fiscal 2001.
Existence of Renewal Options. Certain operating leases provide for renewal options for periods
from one to three years. In the normal course of business, operating leases are generally
renewed or replaced by other leases.
Claims and Litigation. We are presently engaged in a lawsuit filed in the Superior Court in Santa
Clara County, California by Hello Direct (now GN Hello Direct), a former Plantronics
distributor which was acquired by Plantronics’ competitor, GN Netcom. The lawsuit makes
various claims associated with the termination of the distribution relationship between
Plantronics, and Hello Direct, including that Hello Direct has suffered approximately $11
million in damages as a result of it. We have filed a counter-claim against Hello Direct.
We are engaged in another lawsuit that was filed in the United States District Court, for the
Central District of California by Cotron Corporation, a Taiwanese company, alleging patent
infringement by a ClearVox product. We have filed a counter-claim alleging that the Cotron
patent is invalid, unenforceable, and not infringed.
As these claims are pending, the ultimate outcome of the litigation cannot be determined at
this time. Based on information available to date, management believes that these claims are
meritless and we intend to prosecute these claims vigorously. In addition, we are involved
in a number of legal proceedings arising in the normal course of business.
Plantronics 2001 Annual Report 19