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Commitments and Contingencies
3 Months Ended
Mar. 31, 2018
Commitments and Contingencies  
Commitments and Contingencies

8.  Commitments and Contingencies

 

Securities Litigation

 

On March 15, 2018, a purported class action lawsuit was filed by Ann Noyes on behalf of the stockholders of Sigma Designs, Inc. in the United States District Court in the Northern District of California against Sigma Designs, certain current and former Sigma Designs board members and the Company (collectively, the “Defendants”). The lawsuit alleges violations of Section 14(a) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 14a-9 arising out Sigma Designs’ attempt to sell its Z-Wave business to the Company. The lawsuit claims that the Defendants filed a materially incomplete and misleading preliminary proxy statement in connection with the proposed sale of the Z-Wave business. The lawsuit seeks to certify the class, enjoin the sale of the Z-Wave business, award rescissory damages if the sale is consummated, and award unspecified damages and other relief. At this time, the Company cannot predict the outcome of this matter or the resulting financial impact to it, if any.

 

Patent Litigation

 

On January 28, 2014, Cresta Technology Corporation (“Cresta Technology”), a Delaware corporation, filed a lawsuit against the Company (among others) in the United States District Court in the District of Delaware, alleging infringement of three United States Patents (the “Cresta Patents”). Cresta Technology declared bankruptcy in 2016. One of its creditors, DBD Credit Funding LLC (“DBD”) and/or CF Crespe LLC (the “Cresta Successors”) assumed ownership of the Cresta Patents and has substituted in for Cresta Technology in related proceedings.

 

In 2014 and 2015, the Company challenged the validity of two sets of claims in the Cresta Patents at the Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO). In each respective proceeding, the PTAB found the reviewed claims to be invalid. The Federal Circuit Court of Appeals affirmed both determinations. The U.S. District Court dismissed the Delaware proceedings without prejudice on April 3, 2018.

 

On July 16, 2014, the Company filed a lawsuit against Cresta Technology in the United States District Court in the Northern District of California alleging infringement of six United States Patents. A motion to substitute the Cresta Successors as defendants in lieu of Cresta Technology is pending.

 

At this time, the Company cannot predict the outcome of these matters or the resulting financial impact to it, if any.

 

Other

 

The Company is involved in various other legal proceedings that have arisen in the normal course of business. While the ultimate results of these matters cannot be predicted with certainty, the Company does not expect them to have a material adverse effect on its Consolidated Financial Statements.