Vistaprint 2007 Annual Report Download - page 95

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VISTAPRINT LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Years Ended June 30, 2006, 2005 and 2004
(in thousands, except share and per share data)
pre-press graphic files. On June 7, 2007, print24 GmbH filed a patent nullification action in the German
Patent Court in relation to the same European patent at issue in VistaPrint’s infringement lawsuit
against print24 and its co-defendants. On July 31, 2007, the District Court in Düsseldorf ruled in
VistaPrint’s favor on the underlying infringement claim against print24 and its co-defendants, granting
the requested injunction and ordering the defendants to pay damages for past infringement. The
Düsseldorf Court’s ruling is scheduled to go into effect in early September 2007, subject to appeal by
the defendants. We are unable to express an opinion as to the likely outcome of any appeal by print24
and its co-defendants of the Düsseldorf Court’s ruling in the infringement action. print24’s nullification
action in the German Patent Court remains outstanding, in its earliest stages, and we are unable to
express an opinion as to the likely outcome of such action.
On May 14, 2007, VistaPrint Technologies Limited filed a patent infringement lawsuit against
123Print, Inc. and Drawing Board (US), Inc., subsidiaries of Taylor Corporation, in the United States
District Court for the District of Minnesota. The complaint in the lawsuit asserts that the defendants
have infringed and continue to infringe three U.S. patents owned by VistaPrint Technologies Limited
related to browser-based tools for online product design. We are seeking an injunction against the
defendants and the recovery of damages. The defendants filed their Answer and Counterclaims to the
complaint on June 7, 2007, in which they denied the infringement allegations and asserted
counterclaims for declaratory judgment of invalidity, unenforceability and non-infringement of the
patents-in-suit. In August 2007, another Taylor subsidiary, Taylor Strategic Accounts, Inc., was added
as an additional defendant in the case. The lawsuit is in its early stages and we are unable to express
an opinion as to the likely outcome.
The Company is involved, from time to time, in various legal proceedings arising from the normal
course of business activities. Although the results of litigation and claims cannot be predicted with
certainty, the Company does not expect resolution of these matters to have a material adverse impact
on its consolidated results of operations, cash flows or financial position. However, an unfavorable
resolution of such a proceeding could, depending on its amount and timing, materially affect the
Company’s results of operations, cash flows or financial position in a future period. Regardless of the
outcome, litigation can have an adverse impact on the Company because of defense costs, diversion
of management resources and other factors.
The Company is not currently party to any other material legal proceedings.
15. Supplemental Disclosures of Cash Flow Information
Year Ended June 30,
2007 2006 2005
Cash paid during the year for:
Interest .......................................................... $1,789 $1,089 $ 369
Income taxes..................................................... 1,349 766 269
Supplemental disclosure of noncash investing and financing activities:
Accretion of preferred shares ...................................... $ — $1,295 $4,813
91
Form 10-K