In January 2018, a judge in a trade secrets case brought by the Company granted the defendants’ motions for recovery of their attorney fees (see Note 18, “Commitments and Contingencies” for further discussion relating to this matter). A charge in the amount of $675,000 was recorded as a liability in the second quarter of fiscal 2018. The Company appealed this court decision. In January 2019, the Company settled with the defendants and ended its appeal in return for a net payment due to them in the amount of $66,000. As a result, in the second quarter of fiscal 2019, the Company adjusted the accrual.

In the second quarter of fiscal 2020, the Company’s President and Chief Executive Officer resigned and the Company had a reduction in force in the U.S. The resignation and the action resulted in an accrual of $471,000 of severance expense in the quarter ended December 31, 2019.

In February 2020, the Company committed to a financial improvement plan that reduced global headcount by approximately 7%. The plan was implemented to re-align the Company’s fixed costs and its near-to-mid-term expectations for the Company’s business. As a result, in the third quarter of fiscal 2020, the Company recorded a charge for severance and related costs of $590,000. At March 31, 2020, the remaining balance of the reserve was $468,000.

See Note 3 “Goodwill” and Note 4 “Intangible Assets”, of the Notes to the Consolidated Financial Statements, contained in this Quarterly Report on Form 10-Q for a discussion of a triggering event caused by the economic impacts of the COVID-19 pandemic and related restrictions as of March 31, 2020.

These charges recorded as Severance, Impairment and Other Charges are as follows (in thousands):

	Three Months Ended March 31,				Nine Months Ended March 31,
	2020		2019		2020		2019
Impairment	$	2,246	$	-	$	2,246	$	-
Severance and Related Costs	$	590	$	-	$	1,061	$	-
Court Award		-		-		-		(609	)
Total	$	2,836	$	-	$	3,307	$	(609	)

The following table reconciles the activity for the reserves for severance and other charges (in thousands):

	Nine Months Ended March 31,
	2020			2019
Beginning Balance at July 1,	$	44		$	675
Accruals - Severance Related		1,061			-
Accruals / Adjustments - Court Award		-			(609	)
Payments		(637	)		(66	)
Ending Balance at March 31,	$	468		$	-