Seagate 2011 Annual Report Download - page 112

Table of Contents
SEAGATE TECHNOLOGY PLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Intellectual Property Litigation
Convolve, Inc. ("Convolve") and Massachusetts Institute of Technology ("MIT") v. Seagate Technology LLC, et al. —On July 13, 2000,
Convolve and MIT filed suit against Compaq Computer Corporation and Seagate Technology LLC in the U.S. District Court for the Southern
District of New York, alleging infringement of U.S. Patent Nos. 4,916,635, "Shaping Command Inputs to Minimize Unwanted Dynamics" (the
'635 patent) and U.S. Patent No. 5,638,267, "Method and Apparatus for Minimizing Unwanted Dynamics in a Physical System" (the '267
patent), misappropriation of trade secrets, breach of contract, tortious interference with contract and fraud relating to Convolve and MIT's Input
Shaping®
and Convolve's Quick and Quiet™ technology. The plaintiffs claimed their technology is incorporated in the Company's sound barrier
technology, which was publicly announced on June 6, 2000. The complaint seeks injunctive relief, $800 million in compensatory damages and
unspecified punitive damages, including for willful infringement and willful and malicious misappropriation. If willful infringement is found by
the jury, the court may assess, in addition to compensatory damages for the infringement, punitive damages in an amount up to three times the
amount of such compensatory damages. If willful and malicious misappropriation is found by the jury, the court may assess, in addition to
compensatory damages for the misappropriation, punitive damages in an amount up to two times the amount of such compensatory damages. On
November 6, 2001, the U.S. Patent and Trademark Office ("USPTO") issued to Convolve US Patent No. 6,314,473, "System for Removing
Selected Unwanted Frequencies in Accordance with Altered Settings in a User Interface of a Data Storage Device," (the '473 patent"). Convolve
filed an amended complaint on January 16, 2002, alleging defendants infringe this patent. The '635 patent expired on September 12, 2008. The
court ruled in 2010 that the '267 patent was out of the case.
On August 16, 2011, the court granted in part and denied in part the Company's motion for summary judgment. The court granted summary
judgment in favor of the Company on all patent infringement claims and on 11 of the 15 remaining alleged trade secrets at issue. The court also
denied Convolve's request for enhanced damages as moot and dismissed Convolve's request for injunctive relief. Following this ruling, the
parties entered into a stipulation to conditionally dismiss without prejudice the remaining claims in order to facilitate an appeal of the August 16,
2011 order by Convolve to the U.S. Court of Appeals for the Federal Circuit. Pursuant to this stipulation, the court entered a final judgment on
October 4, 2011. Convolve filed its notice of appeal to the U.S. Court of Appeals for the Federal Circuit on November 3, 2011. A hearing before
the Court of Appeals has not yet been scheduled. In view of the court's August 16, 2011 ruling and the uncertainty regarding the amount of
damages, if any, that could be awarded Convolve in this matter, the Company does not believe that it is currently possible to determine a
reasonable estimate of the possible range of loss related to this matter.
Alexander Shukh v. Seagate Technology —On February 12, 2010, former Seagate engineer Alexander Shukh filed a complaint and an
amended complaint against the Company in Minnesota federal court, alleging, among other things, employment discrimination based on his
Belarusian national origin and wrongful failure to name him as an inventor on several patents and patent applications. Mr. Shukh's employment
was terminated as part of a company-wide reduction in force in fiscal year 2009. He seeks damages in excess of $75 million. The Company
believes the claims are without merit and intends to vigorously defend this case. Trial is scheduled to begin July 1, 2013. In view of the
uncertainty regarding the amount of damages, if any, that could be awarded in this matter, the Company does not believe that it is currently
possible to determine a reasonable estimate of the possible range of loss related to this matter.
Rembrandt Data Storage, LP v. Seagate Technology LLC —
On November 10, 2010, Rembrandt Data Storage, LP filed suit against Seagate
Technology LLC in the U.S. District Court for the Western District
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