I am known to some here as Mr. Sensitivity. My daughter named me. I used to post widely on Investors Hub until the threats and bashing got out of control. Several people from this message board asked me to write a report about the Federal Circuit Court hearing last Wednesday. This is volume 2 of 2.
Now to the hearing on October 2. DECN went third in line out of four total arguments. DECN was given 15 minutes to make their case, J&J was given 15 minutes to make their rebuttal position. Finally DECN was given 5 minutes to rebut J&J’s rebuttal. DECN’s counsel, the same guy who has represented them throughout for the last 8 years, must have decided that the judges needed to hear something more or different than just an oral summary restatement of the pleadings. So, the DECN lawyer launched into a tutorial. He schooled the judges on how test strips work, something it appears none of them knew. He then discussed how J&J was totally wrong in their arguments, which was done in a tone like “how dare they.” He then pointed out that the trial judge was also wrong because he acted as if the DECN patents were already invalid when J&J had not filed to invalidate them. By the wat the statute for invalidation of the DECN patents has run. Anyway something clicked with Judge Stoll and the questions came much faster.
One of the other judges, Judge Rayna, then appeared to try to clarify some issues by making helpful claims, even though these claims were not a part of the dispute, but went directly toward the trial judge’s unfortunate actions, in effect stating a major claim about DECN’s patents. The DECN lawyer then jumped on this and explained that the arguments made by J&J and adopted by the trial judge were wrong and used an associative argument to great effect. In my humble opinion, two of the three judges looked convinced, the third judge, Judge Moore not so much. But as Meatloaf says, two out of three ain’t bad. The DECN attorney overshot his time limit by 3.5 minutes and all of the judges let him. So, the DECN lawyer was either entertaining, or his decision to run a tutorial as his presentation had great effect. I listened to the taped replay and I am not sure that the audio did service. On the tape you cannot see facial expressions. Again, two out of three ain’t bad.
Then it was J&J’s turn. J&J allowed their second chair to make the presentation. I don’t know why. Regardless the guy was not particularly good. Wilted lettuce on a nothingburger. I cannot think of one thing the guy said that would help sway a close call into his direction. The J&J lawyer was given 15 minutes, he used only 6.5 minutes. When the J&J attorney ended and took the steps toward his chair, Judge Stoll asked the lawyer directly, (I am paraphrasing) “Don’t you have any comments about what you heard this morning?” The J&J lawyer said nothing. In fact he just stood there about 2 steps from the presentation podium, then he made some sort of comment that I was unable to hear clearly or understand, and then he sat down.
DECN’s lawyer then stood up for what is called a sur-rebuttal and reiterated everything he had said previously, only this time in about 3 minutes, not 18 minutes. He was asked no further questions. After a short pregnant silence the lead judge, Judge Moore said “we will take this under advisement.” So there was no ruling from the bench, or a semi-snide comment like there was for the case heard just before DECN.
So, here is how I view it. If the judges do not Rule 36 the DECN case, and throw it out, it will go to ruling. It will take I believe until late January or early February 2020 for a ruling. Going into the courtroom, based on the performance of the J&J lawyers, I believe they thought the case would be Rule 36ed. First hurdle passed. Today the case before DECN’s case was blown out this morning. I am thinking that if by next Friday, if a Rule 36 does not emerge, the case will await a ruling.
That is not good for J&J given the performance of their lawyers, who I would think promised J&J executives a slam dunk. At the moment we do not know if it will be a J&J slam dunk, but I am thinking it won’t be. And I am thinking that if it goes to a ruling it will be a Precedential (new law) ruling. J&J knows this, so as time goes by, first the exposure period for Rule 36, and then the delay for a written ruling, the J&J lawyers might and probably will get batskit crazy. There will come a time, if DECN plays their cards right, where there will be a golden opportunity to settle the case just before Thanksgiving, but certainly before Christmas, so J&J can dispose of the little company they love to hate.
I am thinking of a settlement, depending on how badly Mr. Berman needs capital, may well be way north of $15 million and south of $50 million.This is a negotiated agreement. In settlements both sides compromise. Settlements are not like quoting and buying stock. They are ungentlemenly battles. Mr. Berman will be called all sorts of names. It will be worse than the names his shareholders call him. But, J&J may show a few cards as well depending on how bad they want to end this. They may, and probably will, provide DECN with a list of names of people that are or were DECN shareholders who helped them, and whether these people were paid. But if this case goes to trial, DECN is certain to win because the argument to decide is simple -- black or white, and the value may well be north of $100 million because J&J sold millions and millions of boxes during the "look-back" period. The guys representing J&J are alley fighters, but I have not found in my research that this firm takes cases to trial. So we will see. We will know shortly how this will develop.
Now to the hearing on October 2. DECN went third in line out of four total arguments. DECN was given 15 minutes to make their case, J&J was given 15 minutes to make their rebuttal position. Finally DECN was given 5 minutes to rebut J&J’s rebuttal. DECN’s counsel, the same guy who has represented them throughout for the last 8 years, must have decided that the judges needed to hear something more or different than just an oral summary restatement of the pleadings. So, the DECN lawyer launched into a tutorial. He schooled the judges on how test strips work, something it appears none of them knew. He then discussed how J&J was totally wrong in their arguments, which was done in a tone like “how dare they.” He then pointed out that the trial judge was also wrong because he acted as if the DECN patents were already invalid when J&J had not filed to invalidate them. By the wat the statute for invalidation of the DECN patents has run. Anyway something clicked with Judge Stoll and the questions came much faster.
One of the other judges, Judge Rayna, then appeared to try to clarify some issues by making helpful claims, even though these claims were not a part of the dispute, but went directly toward the trial judge’s unfortunate actions, in effect stating a major claim about DECN’s patents. The DECN lawyer then jumped on this and explained that the arguments made by J&J and adopted by the trial judge were wrong and used an associative argument to great effect. In my humble opinion, two of the three judges looked convinced, the third judge, Judge Moore not so much. But as Meatloaf says, two out of three ain’t bad. The DECN attorney overshot his time limit by 3.5 minutes and all of the judges let him. So, the DECN lawyer was either entertaining, or his decision to run a tutorial as his presentation had great effect. I listened to the taped replay and I am not sure that the audio did service. On the tape you cannot see facial expressions. Again, two out of three ain’t bad.
Then it was J&J’s turn. J&J allowed their second chair to make the presentation. I don’t know why. Regardless the guy was not particularly good. Wilted lettuce on a nothingburger. I cannot think of one thing the guy said that would help sway a close call into his direction. The J&J lawyer was given 15 minutes, he used only 6.5 minutes. When the J&J attorney ended and took the steps toward his chair, Judge Stoll asked the lawyer directly, (I am paraphrasing) “Don’t you have any comments about what you heard this morning?” The J&J lawyer said nothing. In fact he just stood there about 2 steps from the presentation podium, then he made some sort of comment that I was unable to hear clearly or understand, and then he sat down.
DECN’s lawyer then stood up for what is called a sur-rebuttal and reiterated everything he had said previously, only this time in about 3 minutes, not 18 minutes. He was asked no further questions. After a short pregnant silence the lead judge, Judge Moore said “we will take this under advisement.” So there was no ruling from the bench, or a semi-snide comment like there was for the case heard just before DECN.
So, here is how I view it. If the judges do not Rule 36 the DECN case, and throw it out, it will go to ruling. It will take I believe until late January or early February 2020 for a ruling. Going into the courtroom, based on the performance of the J&J lawyers, I believe they thought the case would be Rule 36ed. First hurdle passed. Today the case before DECN’s case was blown out this morning. I am thinking that if by next Friday, if a Rule 36 does not emerge, the case will await a ruling.
That is not good for J&J given the performance of their lawyers, who I would think promised J&J executives a slam dunk. At the moment we do not know if it will be a J&J slam dunk, but I am thinking it won’t be. And I am thinking that if it goes to a ruling it will be a Precedential (new law) ruling. J&J knows this, so as time goes by, first the exposure period for Rule 36, and then the delay for a written ruling, the J&J lawyers might and probably will get batskit crazy. There will come a time, if DECN plays their cards right, where there will be a golden opportunity to settle the case just before Thanksgiving, but certainly before Christmas, so J&J can dispose of the little company they love to hate.
I am thinking of a settlement, depending on how badly Mr. Berman needs capital, may well be way north of $15 million and south of $50 million.This is a negotiated agreement. In settlements both sides compromise. Settlements are not like quoting and buying stock. They are ungentlemenly battles. Mr. Berman will be called all sorts of names. It will be worse than the names his shareholders call him. But, J&J may show a few cards as well depending on how bad they want to end this. They may, and probably will, provide DECN with a list of names of people that are or were DECN shareholders who helped them, and whether these people were paid. But if this case goes to trial, DECN is certain to win because the argument to decide is simple -- black or white, and the value may well be north of $100 million because J&J sold millions and millions of boxes during the "look-back" period. The guys representing J&J are alley fighters, but I have not found in my research that this firm takes cases to trial. So we will see. We will know shortly how this will develop.
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