Wi-LAN shares plunge after it loses Apple patent suit
Wi-LAN Inc. shares lost about a quarter of their value in heavy trading Thursday following a court ruling against the Ottawa-based company in a patent-infringement battle with Apple Inc.
The stock was down $1.02 to $3.06 with more than 5.2 million shares traded, unusually heavy volume for Wi-LAN, a relatively small company that routinely takes on some of the industry's giants.
Wi-LAN is attempting to assure investors that the Texas jury's ruling on Wednesday will have limited impact on its overall business, which primarily generates revenue from a portfolio of 3,000 patents.
Wi-LAN had filed suit against Apple for infringing a patent related to CDMA and HSPA technologies, but a jury found there was no infringement.
Trial proceedings involving Apple began on Oct. 15 after six other defendants — Alcatel-Lucent USA Inc., Dell Inc., Hewlett-Packard Company, HTC Corp., Novatel Wireless, Inc. and Sierra Wireless Inc. — all signed licence and settlement agreements to resolve the litigation.
In its initial announcement about the ruling, the company said it didn't believe the decision would have a negative impact on licensing agreements with other companies.
Wi-LAN said Thursday morning before trading began that the Texas jury's decision affected only one patent and that it expires in about three months.
The company also estimated that its 2013 annual revenue for 2013 will be in a range of $85 million to $87 million, above analyst expectations.
Wi-LAN said it had between $26 million and $28 million of revenue in the fourth quarter beginning Oct. 1 and $20.7 million in the third quarter ended Sept. 30.
Analysts had been looking for Wi-LAN to generate $82.5 million of revenue this year, down from $87.96 million last year, according to recent estimates compiled by Thomson Reuters.