Consumer Electronics

Kodak Loses Patent Decision -- What’s the Company Worth Now? (EKDKQ, AAPL, RIMM, SSNLF)

A ruling by a US International Trade Commission judge has declared a patent claimed by Eastman Kodak (OTC: EKDKQ) to be invalid, casting even more doubt on the value of the iconic photography company as it wends its way through bankruptcy. The ruling came in a case brought by Kodak against Apple Inc. (NASDAQ: AAPL) and Research in Motion Ltd. (NASDAQ: RIMM) related to how digital images are captured.

Samsung Electronics (OTC: SSNLF.PK) and LG Electronics both paid Kodak nearly $1 billion to gain rights to the discredited patent. Kodak claimed that Apple owed it more than $1 billion for infringing.

The patent was one of about 1,100 included in Kodak’s digital capture technology patent portfolio. That’s about 10% of the company’s total patent portfolio that has been valued as high as $3 billion.

Today’s ruling calls into question the value of Kodak’s entire patent portfolio. Many of the patents are fine, of course, but the ones that really matter are all going to be litigated and a buyer’s anticipated profits from the portfolio just dropped. And probably by a lot. Zero may not be too low.

Paul Ausick

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