Patriot Scientific Corporation Provides Update

CARLSBAD, Calif., March 24, 2014 /PRNewswire/ -- Patriot Scientific Corporation (OTCBB: PTSC) today announced the following:

As stated in our press release on February 20, 2014, we have been evaluating our options in response to the United States International Trade Commission's (ITC) notice affirming the Administrative Law Judge's September 6, 2013 Initial Determination in regards to Patriot's US 5,809,336 ('336) patent.  Although we had hoped by now that this, and certain other matters would have progressed further towards a conclusion, we have decided to provide an update given the passage of time since our last communication.

Patent Litigation

As many are aware, an Investigation had been undertaken by the ITC in which Patriot and other complainants alleged violations of Section 337 of the Tariff Act, seeking importation bans against multiple respondents for certain wireless consumer electronic devices marketed for sale in the United States. Last month the ITC reaffirmed that it found no violation of Section 337 in the aforementioned Investigation.

We had hoped by now to be able to announce our next steps in regards to the ITC Investigation, including whether we would appeal its decision to the U.S. Court of Appeals for the Federal Circuit (CAFC).  The deadline for filing an appeal is April 21, 2014.  We expect that not appealing to the CAFC will result in the resumption of litigation in the U.S. District Court for the Northern District of California (Northern District), where we have alleged infringement of the '749, '890 and '336 patents of the Moore Microprocessor Patent (MMP) Portfolio™ against multiple defendants.  The Northern District litigation has been stayed pending the conclusion of the ITC proceedings.  It was in the Northern District in October 2013 where Patriot won a patent infringement lawsuit, as HTC Corporation was found to infringe on multiple claims of the '336 patent.  Given this, we believe the Northern District to be a fair venue for resolving our allegations of patent infringement, and we will provide further details on this matter as soon as practical.

In the meantime, HTC has appealed the October jury verdict, and we have filed cross-appeals regarding the period available for infringement damages related to the '890 patent.  Prior to the Northern District's ruling that limited infringement contentions to products marketed subsequent to a USPTO re-examination, the '890 had also been the subject of litigation with HTC.

Phoenix Digital Solutions

We have been seeking the appointment of a new and independent third member to the management committee of Phoenix Digital Solutions (PDS), the joint venture that aggregates the ownership interests in the MMP Portfolio, and which facilitates the unified marketing and licensing of the patents.  We have initiated an arbitration process for the selection of this third member.  We believe the appointment of an independent member to the PDS Management Committee will facilitate decision-making in the best interests of the joint venture.

Licensing and Litigation Support

We have been disappointed over several aspects of the working relationship between our joint venture partner, its licensing and litigation support affiliate, and us.  These include concerns over how and what information is shared, invoicing practices and payment demands, and the productivity, efficiency and transparency of the affiliate's activities in general.  Regrettably, similar issues have previously surfaced over the course of the joint venture's existence.  We have asserted, and remain firm on positions that we believe are fair, supportable and legitimate.  We believe that follow-through on our positions is critical to the success of the licensing program.

Stock Price

We have seen a significant drop in our share price since the February announcement of the ITC's ruling.  The Company has repurchased over 1.8 million shares pursuant to SEC Rule 10b-18 since the ITC announcement, and we plan to continue making open market share repurchases as deemed necessary.

About Patriot Scientific Corporation

Headquartered in Carlsbad, California, Patriot Scientific Corporation is the co-owner of the Moore Microprocessor Patent Portfolio™. For more information on PTSC, visit www.ptsc.com. 

About the MMP Portfolio™

The MMP Portfolio includes US patents as well as their European and Japanese counterparts, which cover techniques that enable higher performance and lower cost designs essential to consumer and commercial digital systems ranging from PCs, cell phones and portable music players to communications infrastructure, medical equipment and automobiles.

Safe Harbor Statement: Statements herein which are not purely historical, including statements regarding Patriot Scientific Corporation's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties including, but not limited to, the risk that the recently filed actions and litigation strategy may not be successful and the risks and uncertainties relating to the future of our MMP joint-venture.  It is important to note that the company's actual results could differ materially from those in any such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, risks and uncertainties associated with the effect of changing economic conditions, trends in the products markets, variations in the company's cash flow, market acceptance risks, patent litigation, technical development risks, and seasonality.  Our business could be affected by a number of other factors, including the risk factors listed from time to time in the company's SEC reports including, but not limited to, the annual report on Form 10-K for the year ended May 31, 2013 and the quarterly report on Form 10-Q for the period ended November 30, 2013. The company cautions investors not to place undue reliance on the forward-looking statements contained herein. Patriot Scientific Corporation disclaims any obligation, and does not undertake to update or revise any forward-looking statements made herein.

Contact:
Patriot Investor Relations
[email protected] 
760-547-2700 x-102

SOURCE Patriot Scientific Corporation