Vistaprint 2010 Annual Report Download - page 43

Form 10-K
subscriptions for the membership discount programs. The plaintiffs have requested that the
Defendants be enjoined from engaging in the practices complained of by the plaintiffs. They also are
seeking an unspecified amount of damages, including statutory and punitive damages, as well as pre-
judgment and post-judgment interest and attorneys’ fees and costs for the purported class.
In response to opposing motions filed by the plaintiffs and the Defendants, on December 11,
2008, the Judicial Panel on Multidistrict Litigation ordered the transfer of all of the outstanding cases
to the United States District Court for the Southern District of Texas for coordinated pretrial
proceedings. As a result of the ruling of the Judicial Panel on Multidistrict Litigation, on March 2, 2009
four of the existing plaintiffs filed a Consolidated Complaint with the United States District Court for
the Southern District of Texas.
On August 31, 2009, the United States District Court for the Southern District of Texas
dismissed all of the claims against the Defendants and ruled on substantive grounds that the
Defendants had not violated any of the statutes or common law claims cited by the plaintiffs. In
September 2009, the plaintiffs filed an appeal with the U.S. Fifth Circuit Court of Appeals, and on
August 23, 2010, the Court of Appeals affirmed the District Court’s ruling and dismissal.
On June 26, 2009, Vistaprint Limited, our wholly owned subsidiary, and Vistaprint USA,
Incorporated, a wholly owned subsidiary of Vistaprint Limited, together with sixteen other companies
unaffiliated with Vistaprint Limited or Vistaprint USA, Incorporated, were named as defendants in a
complaint for patent infringement by Soverain Software LLC in the United States District Court for the
Eastern District of Texas. The complaint alleges that the named defendants are infringing U.S. Patents
5,715,314, 5,909,492 and 7,272,639. Two of the asserted patents relate generally to network-based
sales systems employing a customer computer, a shopping cart computer and a shopping cart
database. The third patent relates generally to the use of session identifiers in connection with
requests transmitted through a network between a client and a server. The plaintiff is seeking
declarations that the patents at issue are valid and enforceable and that the defendants infringe the
patents, as well as the entry of a preliminary and permanent injunction and damages. We are unable
to express an opinion as to its likely outcome.
On July 21, 2009, Vistaprint Limited and OfficeMax Incorporated were named as defendants in a
complaint for patent infringement filed by ColorQuick LLC in the United States District Court for the
Eastern District of Texas. The complaint alleges that Vistaprint Limited and OfficeMax Incorporated
are infringing U.S. patent 6,839,149, relating generally to systems and methods for processing
electronic files stored in a page description language format, such as PDF. The plaintiff is seeking a
declaration that the patent at issue is valid and enforceable, a declaration that Vistaprint Limited
infringes, the entry of a preliminary and permanent injunction, and damages. We are unable to
express an opinion as to its likely outcome.
We are not currently party to any other material legal proceedings. We are 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, we do not expect resolution of these
matters to have a material adverse impact on our 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 our results of operations, cash flows or financial position in a
future period. Regardless of the outcome, litigation can have an adverse impact on us because of
defense costs, diversion of management resources and other factors.
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