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TABLE OF CONTENTS
STAMPS.COM INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
12. Legal Proceedings – (continued)
Inc. that the fifteen claims we selected are invalid. We have asked the Court to allow us to select more claims, and the
defendants have asked the Court to enter judgment against us. We intend to file an appeal if the Court enters judgment against
us.
On August 8, 2008, PSI Systems, Inc. filed a lawsuit against us in the same court, alleging that we infringed three PSI
Systems patents related to Internet postage technology. PSI Systems seeks an injunction, unspecified damages, and attorneys’
fees. On September 16, 2008, we filed counterclaims for infringement of four more of our patents. In our counterclaim, we seek
an injunction, unspecified damages, and attorneys’ fees. A “Markman hearing” to determine the meaning of the claims is
scheduled for March 24, 2010. The Court has not scheduled a trial commencement date.
In 2001, we were named, together with certain of our current and former board members and/or officers, as a defendant in
several purported class-action lawsuits, filed in the U.S. District Court for the Southern District of New York. The lawsuits
allege violations of the Securities Act of 1933 and the Securities Exchange Act of 1934 in connection with our initial public
offering and a secondary offering of our common stock. Plaintiffs seek damages and statutory compensation, including interest,
costs and expenses (including attorneys’ fees). In October 2009, the court approved a settlement of this action, which does not
require us to make any payments. The court approval has been appealed.
We are subject to various other routine legal proceedings and claims incidental to our business.
Litigation is uncertain, and the outcome of individual cases is not predictable with any assurance. We have established loss
provisions only for matters in which losses are probable and can be reasonably estimated. Some of the matters pending against
us involve potential compensatory, punitive or treble damage claims, or sanctions, that if granted, could require us to pay
damages or make other expenditures in amounts that could have a material adverse effect on our financial position or results of
operations.
13. Subsequent Events
Except as noted in the following paragraph, we are not aware of any material subsequent events or transactions that have
occurred that would require recognition in the financial statements or disclosure in the notes to the financial statements.
On February 27, 2010, we entered into a stock purchase agreement whereby we purchased 1.3 million shares for $11.4
million outside our current stock purchase program.
F-23