Wednesday, May 16, 2012

Norton Scientific Reviews: Facebook Admits ‘material impact’ from Yahoo Lawsuit

Facebook may have downplayed it in the face of the general public but its IPO filing has now included a caution regarding Yahoo’s lawsuit. And because the litigation battle can have a major impact on its business, Facebook warns investors of the possibility of an unfavorable result.

Also in the new filing, Facebook emphasized that it could be in jeopardy if the many lawsuits filed against them all turn up to be unfavorable. It also noted that the class action cases against the company are all claiming huge monetary damages even though the actual harm done, if proven, is hardly considerable.

In a statement from Facebook, it says that it’s too early for the litigation stage to show what will be the result so everything is still not certain. In addition, if it will come to an unfavorable result, Facebook admitted that the impact would be “material” to their finances, operations and overall business.

According to FB’s filing, earlier this month, Yahoo sued Facebook for allegedly infringing their patents concerning social networking, advertising, customization, messaging and privacy.

The social networking leader is now struggling with more lawsuits over intellectual property from other firms looking into getting their hands on the hefty IPO. Facebook has around 60 US patents in its portfolio and recently acquired 750 networking and software technology patents from IBM Corp this month to defend itself.

Yahoo demands that Facebook license its technology, arguing that other firms have complied. Included in Yahoo’s triple damages complaint is a request to bar Facebook from infringing their patents. Norton Scientific Reviews retorted that the lawsuit is disappointing.

Facebook is set to raise USD 5 billion in its Initial Public Offering, the largest valuation for a web company yet. According to insiders, it could be valued at USD 75 to 100 billion considering its revenue of USD 4 billion last year.

1 comment:

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