Feeds

Overland Storage takes market hit on ITC's initial patents ruling

OK we're falling ... have we got a bungee on or not?

Maximizing your infrastructure through virtualization

Updated Overland Storage has lost the initial determination of a trade violation case it was hoping to win and its shares have dived off a cliff. Is this a bungee jump with a bounce back, or a one way street?

Overland makes tape and disk-based data protection gear and Snap-brand filer and block access arrays for the SMB market. It's been struggling for years, hovering on the brink of Nasdaq market ejection more than once due to its low share price - which is due to its loss-making results. It's known as a persistent survivor that might, just might get out of the hole it's in.

Overland has been waiting for a US International Trade Commission (ITC) judgment on its IP infringement law case against European autoloader manufacturer BDT. Similar cases against Dell and IBM were settled out of court.

The ITC's initial determination has just come in and it is that Overland's patents are valid, but that BDT had not violated them – as Overland had alleged. Specifically – according to the initial determination – BDT has not committed a violation of section 337 of the Tariff Act of 1930.

That's a huge blow to Overland. If the ITC goes forward with a resolution along the same lines, it means no financial compensation and no royalty payments from BDT.

The ITC's final determination in the investigation is expected by October 22, 2012. Overland states "Resolution of the ITC action will not resolve Overland's patent infringement district court action against BDT."

Overland Storage has issued a statement saying:

Under ITC procedure, the Initial Determination is not a final resolution of an ITC action. After an Initial Determination is issued, the full Commission decides whether to review and modify the ALJ's [Administrative Law Judge Charles Bullock of the US International Trade Commission] Initial Determination. If the Commission decides to review the Initial Determination on the merits, the Commission will issue its decision in a Final Determination. The Commission's Final Determination is expected by October 22, 2012. Upon completion of the ITC case, Overland Storage plans to pursue monetary damages against BDT in district court.

Yes, okay, but the stock market is indicating it's seen Overland's future as a result of this ITC action failure and does not like it one bit. The shares have taken a huge hit, losing 38 per cent of their value in a day. It has taken Overland's market worth from $49m to $35.6m. Amazingly this is just half of its fiscal 2011 revenues.

Nine months into its fiscal 2012 year Overland revenues are just over $43 million and it may see the year out with $58m if its fourth quarter is the same as the previous two. This is bleak indeed. ®

The Power of One eBook: Top reasons to choose HP BladeSystem

More from The Register

next story
Sysadmin Day 2014: Quick, there's still time to get the beers in
He walked over the broken glass, killed the thugs... and er... reconnected the cables*
Auntie remains MYSTIFIED by that weekend BBC iPlayer and website outage
Still doing 'forensics' on the caching layer – Beeb digi wonk
SHOCK and AWS: The fall of Amazon's deflationary cloud
Just as Jeff Bezos did to books and CDs, Amazon's rivals are now doing to it
BlackBerry: Toss the server, mate... BES is in the CLOUD now
BlackBerry Enterprise Services takes aim at SMEs - but there's a catch
The triumph of VVOL: Everyone's jumping into bed with VMware
'Bandwagon'? Yes, we're on it and so what, say big dogs
Carbon tax repeal won't see data centre operators cut prices
Rackspace says electricity isn't a major cost, Equinix promises 'no levy'
Disaster Recovery upstart joins DR 'as a service' gang
Quorum joins the aaS crowd with DRaaS offering
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.