Commitments and Contingencies

9 Months Ended

Sep. 30, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

13. Commitments and Contingencies

Leases

The Company leases its buildings under operating leases that expire on various dates through 2022. Future minimum annual lease payments under such leases as of September 30, 2012 are as follows (in thousands):

Year Ending December 31,	Operating
2012-3 months	$	645
2013		2,608
2014		2,602
2015		2,420
2016		2,125
2017		1,787
Beyond		6,314
Total	$	18,501

Rent expense under operating leases for the three months ended September 30, 2012 and 2011 was $0.8 million and $0.7 million, respectively. Rent expense under operating leases for the nine months ended September 30, 2012 and 2011 was $2.1 million and $2.2 million, respectively.

As a condition of our Pittsburgh lease that was signed in November 2010, the landlord agreed to incentives of $40.00 per square foot, or a total of $2.2 million, for improvements to the space. These costs have been included in deferred rent in our long-term liabilities and are being amortized over the ten year lease term.

Pennsylvania Opportunity Grant Program

On September 26, 2011, we received $1.0 million from the State of Pennsylvania to help fund our agreement to start-up a new facility. The grant carries with it an obligation, or commitment, to employ at least 232 people within a three-year time period. This grant contains conditions that would require us to return a pro-rata amount of the monies received if we fail to meet these conditions. As such, the monies have been recorded as a liability in the long-term liabilities line item on the balance sheet until we are irrevocably entitled to retain the monies.

Litigation

On June 29, 2011, a complaint was filed in the U.S. District Court for the Central District of California against us and certain of our current officers on behalf of certain purchasers of our common stock. The complaint was brought as a purported stockholder class action, and, in general, included allegations that we and certain of our officers violated federal securities laws by making materially false and misleading statements regarding our business prospects and financial results, thereby artificially inflating the price of our common stock. The plaintiff sought unspecified monetary damages and other relief. Defendants filed a motion to dismiss the consolidated amended complaint and, on May 21, 2012, the Court granted defendants’ motion to dismiss without prejudice and afforded plaintiffs leave to amend their complaint. Co-lead plaintiffs did not file an amended complaint, and instead agreed to dismiss the action with prejudice. On July 19, 2012, the parties stipulated to dismiss the action with prejudice, with each side to bear its own attorney’s fees and costs. The stipulation fully, finally and forever releases defendants from any and all claims asserted by co-lead plaintiffs in the federal class action. The Court entered the stipulation into order on August 16, 2012.

On August 11, 2011, a shareholder derivative complaint was filed in the Superior Court of California for the County of Orange against the Company’s directors and certain of its executive officers. Thereafter, two additional similar complaints, also styled as shareholder derivative actions, were filed in state court (collectively, the “State Derivative Actions”). On March 29, 2012, the Court consolidated the three State Derivative Actions and appointed lead counsel. Following the stipulated dismissal of the federal stockholder class action, the parties filed, on July 30, 2012, a stipulation to dismiss the State Derivative Actions with prejudice. The Court entered that stipulation into order on July 31, 2012.

On September 12, 2011, a shareholder derivative complaint was filed in the U.S. District Court for the Central District of California against certain of the officers and directors named in the State Derivative Actions but also against additional officers of the Company. Thereafter, the matter was consolidated with two additional similar complaints that were also filed in federal court (collectively, the “Federal Derivative Actions”). Following the stipulated dismissal of the federal stockholder class action, the parties filed, on July 30, 2012, a stipulation to dismiss the Federal Derivative Actions with prejudice. The Court entered that stipulation into order on July 31, 2012.

The Company is and may become involved in various other legal proceedings arising from its business activities. While management does not believe the ultimate disposition of these matters will have a material adverse impact on the Company’s consolidated results of operations, cash flows or financial position, litigation is inherently unpredictable, and depending on the nature and timing of these proceedings, an unfavorable resolution could materially affect the Company’s future consolidated results of operations, cash flows or financial position in a particular period.