Versant Partners Liston: Wi-LAN Knows Location Matters

Not here for the oranges: Versant Partners analyst Tom Liston says Wi-LAN has been particularly adept at using US "forum shopping" rules to maximize its chances in court. The Ottawa company opened an office in patent litigation friendly Florida in January.

In early January, Ottawa’s Wi-LAN (TSX:WIN) opened a US office in Florida. Those who think CEO Jim Skippen and crew are looking for some respite from the harsh Ottawa winters aren’t looking closely enough, says Versant Partners analyst Tom Liston.

The Southern District of Florida, Liston points out, is a district that scores particularly well in terms of being friendly to those filing patent claims.

In fact, he noted in a research update to clients today, Wi-LAN has been particularly cagey about where it files their suits; all of the company’s active patent infringement suits are in the top quartile of the ninety-four jurisdictions that exist in the US.

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Wi-LAN, which was founded in 1992, now has more than three-thousand patents, and licensing arrangements with many multinationals including Cisco, Panasonic and Samsung to use them. But the company is no stranger to patent infringement claims, having launched actions against many others, including Apple, Intel and and Toshiba. Under Skippen’s watch, the company’s revenue has climbed from just over $2 million in fiscal 2006, to the more than $100 million. Wi-LAN has quietly become one of the world’s top patent acquirers, on par or better than giants Google, Apple and Samsung in the third quarter of 2011.

A US law, which has come to be known as “forum shopping” allows plaintiffs to file suit anywhere in the United States where the defendant’s product is sold or used. Early this year, when Wi-LAN sued RIM over technology relating to Bluetooth data transmission and the “Sym” key on Blackberrys, it did so in Florida. According to court documents pointed out The Financial Post’s Jameson Berkow, Wi-LAN said the reason it was suing a fellow Canadian company was that Research in Motion has held its annual conference in Orlando for six years.

Liston today maintained his BUY rating on Wi-LAN and $7 target. Shares of Wi-LAN on the TSX closed today down .4% to $5.15.

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