1. MCM Portfolio LLC (“MCM”) is the owner of the CORE Flash Portfolio. TPL and
MCM are parties to a commercialization agreement whereunder TPL not only
commercializes and licenses CORE Flash patents but is required to protect their value
and prosecute the patents it is commercializing. Alliacense is TPL’s licensing agent
and has been providing said services since TPL entered into the commercialization
agreement with MCM in 2006.
2. On March 27, 2013, HP petitioned the United States Patent and Trademark Office
(“USPTO”) to institute a new form of post-grant review created by the 2011 America
Invents Act known as an “Inter Partes Review” (“IPR”) against CORE Flash patent
US 7,162,549 and assigned Case No. IPR2013-00217. The Petition was granted. A
Writ of Mandamus in the District Court challenging the USPTO’s legal basis for
granting HP’s petition was filed in defense of the patent.
3. The above-captioned Chapter11 bankruptcy case was filed on March 20, 2013.
4. Following a bench trial in the IPR proceeding on 6/4/14, the Patent and Trademark
Appeals Board (PTAB) issued its final decision (8/6/14) finding certain claims of
U.S. ‘549 invalid. MCM considers the finding reversible error for various reasons,
including: finding U.S.’549 invalid based on insufficient evidence to support the
verdict, and denying the argument that HP’s IPR was barred due to its filing more
than a year after Pandigital was sued for patent infringement when the statute is clear
on its face as to the year deadline.
5. MCM has demanded that TPL either proceed with the ‘549 appeal or reconvey to
MCM all rights to the ‘549 to MCM. MCM asserts that TPL is presently in default of
the commercialization agreement for failing to prosecute the ‘549 appeal.
6. TPL presented the Official Unsecured Creditors’ Committee (the “OCC”) with
information regarding the pros and cons of proceeding with the ‘549 appeal. The
Committee agreed to a schedule under which TPL would pay Alliacense $50,000 for
work immediately required on the ‘549 appeal in exchange for a delay until
MOTION TO AUTHORIZE COMPROMISE AND RETURN OF PATENT
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December 4, 2014, of the deadline for TPL to decide if it is going to proceed with the
appeal or reconvey all right, title and interest in and to the ‘549 patent to MCM.
7. On November 24, 2014, the OCC determined not to pursue the appeal of the ‘549 and
to reconvey all right, title and interest in and to the ‘549 patent to MCM.
8. Reconveyance of all right, title and interest in and to the ‘549 patent relieves TPL of
the administrative burden under its commercialization agreement with MCM to pay
the remaining cost of appeal of approximately over $200,000. TPL will retain its
rights to license and commercialize the remainder of the patents in the CORE Flash
portfolio and will release it from its obligations under an agreement now in breach,
which could not otherwise be assumed or assigned under the law of the 9th Circuit in
any case in light of the current breach.
9. The reconveyance of the interest will not affect the security interest of the Secured
Creditors in the reconveyed assets.
WHEREFORE, TPL respectfully requests that this Court issue an order granting this
Motion and authorizing TPL to reconvey all right, title and interest in and to the ’549 portfolio to
MCM in a form acceptable to MCM and affirming that such reconveyance is in compliance with
all applicable Bankruptcy Court rules and that TPL no longer has any right, title or interest in or
to U.S. Patent ‘549.
BINDER & MALTER, LLP
By:_____________________________
Robert G. Harris
Attorneys for Attorneys for Debtor and Debtor-in-
Possession TECHNOLOGY PROPERTIES
LIMITED LLC
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