Case: 1:12-cv-08450 Document #: 83 Filed: 01/13/15 Page 1 of 40 PageID #:998
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
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`OCEAN TOMO, LLC,
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`Plaintiff-Counter Defendant,
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`
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`v.
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`JONATHAN BARNEY and
`PATENTRATINGS, LLC,
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`Defendant-Counter Plaintiffs.
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`No. 12 C 8450
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`Judge: Joan B. Gottschall
`Magistrate: Judge Mary M. Rowland
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`SECOND AMENDED AND SUPPLEMENTAL COMPLAINT FOR INJUNCTIVE
`RELIEF, DECLARATORY JUDGMENT AND DAMAGES
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`As and for its Second Amended and Supplemental Complaint for Injunctive Relief,
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`Declaratory Judgment and Damages against Defendants Jonathan Barney (“Barney”) and
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`PatentRatings, LLC (“PR”) (collectively, “Defendants”), Plaintiff Ocean Tomo, LLC (“OT”), by
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`and through its attorneys, Vedder Price P.C., states and alleges as follows:
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`NATURE OF ACTION
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`1.
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`This action arises out of a soured business relationship between OT, on the one
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`hand, and PR and Barney, on the other hand. Barney created PR, a company that owns and
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`develops proprietary objective computer-generated metrics for determining the quality and
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`relevance of issued United States patents. Barney is the Chief Executive Officer and the
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`majority owner of PR.
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`2.
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`In approximately 2004, OT and PR entered into a License Agreement pursuant to
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`which, among other things, PR provided to OT certain proprietary computer-generated metrics
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`for determining the quality and relevance of patents. As part of the business relationship, Barney
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`became a Member of OT, and OT became a Member of PR, assuring that each company would
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`have a vested interest in the future performance of the other. Over the years, OT has made
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`substantial capital investments and loans for the development of this technology, secured by
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`PR’s assets.
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`3.
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`In 2007, a dispute arose between the parties regarding amounts loaned by OT to
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`PR. In settlement of that dispute and other issues, on July 19, 2007 the parties entered into an
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`amendment to the License Agreement, a security agreement and promissory note pursuant to
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`which, inter alia, the amount of the disputed loan was set at $1,500,000 and the revenue share
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`payable by OT to PR was altered.
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`4.
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`Nonetheless, disputes between the parties continued to arise, and in early 2012 PR
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`purported to wrongfully terminate the agreements between the parties based upon nonmaterial
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`breaches which, if they are even breaches in the first place, have been cured by OT in accordance
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`with the License Agreement. In addition, PR has attempted to rescind the 2007 amendment,
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`security agreement and promissory note based on unsupported allegations of fraudulent
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`misrepresentations and concealments.
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`5.
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`By this action, OT seeks a declaration from this Court that: 1) OT is not, and
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`never was, in breach of its contracts with PR; 2) in the alternative to the foregoing, to the extent
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`any breach of the License Agreement occurred, any and all such breaches are nonmaterial or
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`have been subsequently cured by OT; 3) to the extent PR contends that there are other uncured
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`breaches, PR has not provided adequate notice thereof and therefore has not met the contractual
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`precondition to termination of the License Agreement; 4) to the extent PR seeks to rescind any of
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`the parties’ agreements for fraud and/or failure of consideration, PR’s asserted grounds for
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`rescission are without merit and are barred; and 5) the parties’ agreements remain in full force
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`and effect, and OT retains its rights thereunder.
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`6.
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`In addition, OT brings a number of claims arising out of Barney’s improper
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`behavior while the parties’ relationship was deteriorating. Barney was a Member and Managing
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`Director of OT, and as such, he was intimately involved in the development and marketing of
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`OT’s services and was given access to detailed knowledge of OT’s confidential information
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`relating to financial data, business plans, business methods and practices, and client identities,
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`needs and preferences. Additionally, Barney was provided access to sensitive and confidential
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`information about OT’s financial and client data related to OT’s clients (including historical and
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`realized revenues, and profit margins), strategic plans, business development efforts, proprietary
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`products and valuation methods, and client requirements.
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`7.
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`Because he was provided access to OT’s confidential information and client
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`relationships and as a condition of his employment, Barney executed an employment agreement
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`(the “Employment Agreement”) that prohibited him from using or disclosing OT’s confidential
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`information for his own benefit or the benefit of anyone other than OT.
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`8.
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`During the course of his employment with OT, Barney was provided with a laptop
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`for business use (the “Laptop”). The Laptop contained OT’s confidential information relating to
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`financial data, business plans, business methods and practices, and client identities, needs and
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`preferences. Further, Barney executed a Computer Asset Policy Agreement (the “CAP
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`Agreement”) during his employment with OT that prohibited him from modifying, altering or
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`upgrading any hardware or software provided to him by OT.
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`9.
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`Barney resigned from OT on or about February 14, 2011. At that time, he did not
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`return the Laptop to OT. Despite multiple demands by OT for the return of the Laptop, Barney
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`refused to turn over the Laptop until on or about June 14, 2011. Upon receiving the Laptop from
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`Barney, OT hired a forensic expert, who analyzed the Laptop and determined that the hard drive
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`on the Laptop had been intentionally overwritten or wiped, which permanently deleted and
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`destroyed all of OT’s confidential and proprietary information from the Laptop.
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`10.
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`In addition to completely wiping the hard drive of the Laptop, Barney, upon
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`information and belief, made a copy of the Laptop’s hard drive before erasing it. This copy has
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`not been provided to OT. Upon information and belief, Barney continues to access and use data
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`from the copied hard drive, including OT’s confidential business and financial information.
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`11.
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`Further, starting at least as early as in approximately February 2012, Barney and
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`PR began contacting, and continue to contact, NTT Data, a potential customer and business
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`partner of OT, in order to divert NTT Data’s business away from OT and to PR. Barney and PR
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`have attempted to solicit business from NTT Data despite knowing that OT has a valid business
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`expectancy in its relationship with NTT Data.
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`12.
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`As such, OT asserts claims for breach of contract, breach of fiduciary duty,
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`violation of the Illinois Trade Secrets Act, 765 ILCS 1065/1 et seq. (“ITSA”), violation of the
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`Computer Fraud and Abuse Act, 18 U.S.C. § 1030 (“CFAA”), conversion, and tortious
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`interference with prospective economic advantage, arising out of Barney’s destruction, copying
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`and use of OT’s confidential information and trade secrets, along with his and PR’s attempt to
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`divert a business opportunity away from OT. OT likewise seeks a declaratory judgment
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`establishing that it is not tortiously interfering with Defendants’ business expectancies or
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`relationships.
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`13.
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`OT seeks preliminary and permanent injunctive relief to restrain and enjoin
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`Barney’s continued breaches of the Employment Agreement, which have caused and continue to
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`cause irreparable injury to OT, including injunctive relief enjoining Barney from (i) using or
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`disclosing OT’s confidential information for his own benefit or the benefit of anyone other than
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`OT and (ii) tortiously interfering with OT’s business expectancies and relationships. OT further
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`seeks an order compelling Barney to return all OT trade secrets, confidential information, and all
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`other proprietary information and property belonging to OT, including without limitation, the
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`copy of the Laptop hard drive believed to be in Barney’s possession.
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`14.
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`In addition to injunctive and declaratory relief, OT has incurred damages from
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`Barney’s ongoing misconduct and seeks compensatory damages, punitive and exemplary
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`damages, and such other relief as the Court deems just and proper.
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`PARTIES
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`15.
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`OT is an Illinois limited liability company with its principal place of business in
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`Chicago, Illinois. OT, the leading Intellectual Capital Merchant Banc firm, provides, among
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`other things, financial products and services related to expert testimony, valuation, investments,
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`risk management and transactions throughout the United States and overseas. Most of OT’s
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`high-level executives are located in the Chicago, Illinois area. OT’s corporate activities and
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`critical decision-making take place at the corporate headquarters located in Chicago, Illinois.
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`16.
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`Barney is an individual who, upon information and belief, resides at 312 Signal
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`Road, Newport Beach, California 92663. Barney was a Managing Director at OT and was the
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`head of OT’s PatentRatings® (“OTPR”) group at the time of his resignation on or about
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`February 14, 2011. Barney was and currently is one of only three equity owners of OT. Barney
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`is currently the Chief Executive Officer and majority owner of PR.
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`17.
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`PR is a California limited liability company, with its principal place of business in
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`Irvine, California, that owns and develops proprietary objective computer-generated metrics for
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`determining the quality and relevance of issued United States patents.
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`JURISDICTION
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`18.
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`Jurisdiction is proper in this Court pursuant to 28 U.S.C. § 1331 with respect to
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`OT’s claim under the Computer Fraud and Abuse Act, 18 U.S.C. § 1030. With respect to the
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`remaining claims, jurisdiction is proper in this Court pursuant to 28 U.S.C. § 1367.
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`19.
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`Venue
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`is proper
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`in
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`this
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`judicial district and division pursuant
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`to
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`28 U.S.C. § 1391(a), in that a substantial portion of the events giving rise to OT’s claims arose in
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`this district.
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`GENERAL ALLEGATIONS
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`OT’s Business
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`20.
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`OT, the Intellectual Capital Merchant Banc firm, provides, among other things,
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`expert testimony, investment advice, risk management, transaction assistance and valuation
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`services related to intellectual property assets.
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`21.
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`One of OT’s business units is OTPR, which is responsible for the marketing and
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`sale of Ocean Tomo PatentRatings® products and services based upon the data provided under
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`agreement with PR. PR has exclusively licensed to OT and has contracted to supply OT with
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`data and tools based upon PR’s computer-generated metrics for determining the quality and
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`relevance of issued United States patents. Barney owns a controlling interest in PR, and OT
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`owns a minority interest of 25% in PR.
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`22.
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`Due to its vast research and development initiatives, and cultivation of
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`long-standing business relationships, OT has developed certain trade secrets and confidential
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`information pertaining to its business, including, but not limited to: valuation report templates,
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`research tools, financial information, collections, revenues, profit margins, business plans,
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`business development efforts, proprietary products, client requirements, business plans and
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`strategies, pricing, fees, profitability factors, marketing materials, training materials, marketing
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`strategies, and personnel information, including personnel lists, resumes, salary information,
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`organizational structure and performance evaluations. These trade secrets and confidential
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`information provide a substantial economic and competitive advantage to OT and, if known to a
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`competitor, would negatively impact OT in the marketplace.
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`The PatentRatings Tools
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`23.
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`Barney is an attorney and inventor of intellectual property and data used for the
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`evaluation and analysis of United States patents. Barney created PR, which developed
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`technology and a database that, using algorithms and regression analysis, measures the relative
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`strength and quality of a particular patent. Using more than 60 factors, PR’s technology can
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`grade a patent with an IPQ® patent quality score, which is a numerical estimation of the patent’s
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`quality.
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`24.
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`Because a substantial portion of OT’s business involves business and financial
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`strategies concerning intellectual property assets, OT became interested in utilizing PR’s patent-
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`rating metrics.
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`25.
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`As such, in 2004 OT approached PR about entering into a business arrangement
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`whereby OT would acquire rights to access and use PR’s technology and database, and to
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`distribute and resell the information and reports derived therefrom (the “PatentRatings
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`Analysis”).
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`26.
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`OT and PR entered into negotiations regarding the use of PR’s technology in
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`summer 2004.
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`The License Agreement and Barney’s Employment by OT
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`27.
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`Following negotiations, OT and PR entered into that certain License Agreement
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`effective as of September 1, 2004 (the “License Agreement”). OT and PR also entered into
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`amendments to the License Agreement on December 31, 2004, May 2, 2005 and July 19, 2007.
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`True and correct copies of the License Agreement, the December 31, 2004 amendment, the
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`May 2, 2005 amendment and the July 19, 2007 amendment are attached hereto as Exhibit A,
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`Exhibit B, Exhibit C and Exhibit D, respectively.
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`28.
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`Pursuant to the License Agreement, PR granted OT access to the PatentRatings
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`Tools at OT’s offices and a limited exclusive license to “reproduce, install, and use the
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`PatentRatings Tools [and] distribute, sell, license or other transfer for use (or offer to sell, license
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`or otherwise transfer for use), and display PatentRatings Analysis to third parties for a fee,”
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`subject to other terms and conditions. (Ex. A §§ 2.1 and 3.1(a)–(b).) The “PatentRatings Tools”
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`as used herein shall have the same meaning as in the License Agreement, which defines the
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`PatentRatings Tools as follows:
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`“PatentRatings Tools” means LICENSOR’s technology, know-
`how, software (, [sic] computer algorithms, techniques, for
`statistically analyzing, rating, mapping and valuing patents and/or
`other intellectual property assets, and including any documentation
`and research relating to such software) and other LICENSOR
`intellectual property relating to the foregoing (including the
`PatentRatings Patents, PatentRatings Copyrights and PatentRatings
`Marks).
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`29.
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`OT had the royalty-free right to use the PatentRatings Tools for internal purposes,
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`but the License Agreement required OT to pay to PR 100% of OT’s revenues resulting from its
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`sales of the PatentRatings Analysis. (Ex. D §§ 4.1, 4.3, 4.4(a).)
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`30.
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`Among other things, the License Agreement permits PR to inspect OT’s records
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`related to payments to PR upon reasonable notice. (Ex. A § 4.5(c).)
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`31.
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`To the extent a party to the License Agreement contends that the other party has
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`breached the agreement, the License Agreement requires that a party send written notice of the
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`alleged breach and permit the alleged breaching party 30 days to cure the alleged breach.
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`Specifically, the License Agreement provides that the agreement will terminate only “upon
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`written notice of termination by either party to the other if the other party has committed a
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`material breach of this [License] Agreement which has not been cured within 30 days following
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`written notice to [the breaching] party specifying such breach and demanding that the same be
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`cured.” (Ex. A § 10.2(a).)
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`32.
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`The term of the License Agreement is “the longest term permitted by law.” (Ex.
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`C § 10.1.)
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`33.
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`OT’s initial use of the PatentRatings Tools revealed several problems with the
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`database and technology, and significant amounts of capital were necessary to utilize the
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`essential functions of the PatentRatings Tools.
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`34.
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`As such, on May 31, 2005 the parties entered into a Management Services
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`Agreement pursuant to which OT provided, inter alia, extensive management services to PR and
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`a substantial infusion of capital (in excess of $1,500,000) to upgrade the PatentRatings Tools. A
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`copy of the Management Services Agreement is attached hereto as Exhibit E.
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`35.
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`In or around the first half of 2007, OT and PR engaged in discussions regarding
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`revision of their relationship. As part of those discussions, PR disputed the amounts advanced
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`by OT as a loan under the Management Services Agreement. In settlement of that dispute and
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`other issues, on July 19, 2007, the parties entered into the July 19, 2007 Amendment (Ex. D)
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`pursuant to which the amount of the disputed loan was set at $1,500,000, the Management
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`Services Agreement was terminated and the revenue share payable by OT to PR was altered.
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`36.
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`In order to repay the $1,500,000 loaned by OT to PR pursuant to the terms of the
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`Management Services Agreement, on July 19, 2007, PR also entered into a Secured Promissory
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`Note pursuant to which PR undertook an unconditional obligation to repay to OT the amount of
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`$1,500,000 (the “Note”). A copy of the Note is attached hereto as Exhibit F.
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`37.
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`To secure PR’s promise to pay under the Note, PR granted OT a first priority lien
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`upon, and security interest in, all of PR’s assets. (Ex. F § 5.)
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`38.
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`In conjunction with the security interest granted OT by PR pursuant to the Note,
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`PR and OT also entered into the Intellectual Property Security Agreement on July 19, 2007 (the
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`“Security Agreement”). A copy of the Security Agreement is attached hereto as Exhibit G.
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`39.
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`Pursuant to the terms of the Security Agreement, and in order to “secure its
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`obligations under the Note and under any other agreement now existing or hereafter arising
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`between PR and OT,” PR granted and pledged to OT a security interest in all of PR’s intellectual
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`property, much of which was specifically identified in three schedules to the Security
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`Agreement. (Ex. G.)
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`40.
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`Through the course of OT’s relationship with PR, OT has infused substantial time
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`and capital into the upgrade and maintenance of the PatentRatings Tools. Without OT’s
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`commitment to the PatentRatings Tools, they would not be functional today.
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`OT’s Hiring of Barney and His Access to Confidential Information
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`41.
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`In connection with the negotiation of the License Agreement, OT hired Barney to
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`act as Managing Director for the OTPR business unit effective as of January 2005. Also, at that
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`time, Barney became an equity owner of OT. Barney currently remains one of three such equity
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`owners of OT.
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`42.
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`As Managing Director for OTPR, Barney was responsible for managing and
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`overseeing the marketing and sale of Ocean Tomo PatentRatings® products and services,
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`including IPQ® patent quality scores and patent relevance scores. As of the time of his
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`resignation, Barney’s annual salary was $210,000, and he also received profit-sharing payments.
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`43.
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`In his position with OT, and subject to strict confidentiality obligations, Barney
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`was provided access to OT’s confidential information. Barney was provided access to nearly all
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`of OT’s business information, including information about OT’s overall financial performance;
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`the performance of each of OT’s practice areas; collections and revenue; business plans;
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`opportunities for business development and growth; and other sensitive and confidential
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`information belonging to OT.
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`44.
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`As part of his employment with OT, Barney was provided with the Laptop. The
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`Laptop contained OT’s confidential information, trade secrets and other proprietary information
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`relating to OT’s financial data, business plans, business methods and practices, and client
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`identities, needs and preferences. Furthermore, the Laptop also contained OT’s high-level
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`confidential business information, which included information and data regarding overall
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`financial performance; the performance of each of OT’s practice areas; collections and revenue;
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`business plans; opportunities for business development and growth; and other sensitive and
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`confidential OT information.
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`OT’s Agreements with Barney
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`45.
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`Because OT was providing Barney with access to OT’s confidential information
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`and client relationships, OT required Barney, as a condition of employment, to execute and agree
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`to the Employment Agreement. Barney signed the Employment Agreement on or about January
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`1, 2005. A true and correct copy of the Employment Agreement is attached hereto as Exhibit H.
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`46.
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`In the Employment Agreement, Barney agreed that, as part of his employment, he
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`would be exposed to OT’s confidential information and that he would maintain the
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`confidentiality of that information, would not use such information for his own benefit, directly
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`or indirectly, and would not disclose that information. Specifically, Barney agreed as follows:
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`Executive
`The
`Information.
`Section 5.2. Confidential
`understands and acknowledges that during his employment with
`the Company he will be exposed to Confidential Information that
`is proprietary and that rightfully belongs to the Company. The
`Executive agrees that he will not use or cause to be used for his
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`own benefit, directly or indirectly, or disclose any of such
`Confidential Information at any time, either during or after his
`employment with the Company, whether or not such Confidential
`Information is developed by the Executive . . . The Executive shall
`take all commercially reasonable steps to safeguard Confidential
`Information that is within his possession or control and to protect
`such information against disclosure, misuse, loss or theft . . . The
`term “Confidential Information” means any information not
`generally available to the public that was obtained from the
`Company, or any of its Affiliates or that was learned as a result of
`the performance of any services by the Executive to or on behalf of
`the Company, and which falls within the following general
`categories:
` (a) information concerning trade secrets of the
`Company or any of its Affiliates; (b) information concerning
`existing or contemplated products, services, technology, designs,
`processes, research or product developments of the Company or
`any of its Affiliates; (c) information concerning business plans,
`sales or marketing methods, methods of doing business, customer
`lists, customer usages and or requirements, or supplier information
`of the Company or any of its Affiliates; (d) information concerning
`the identity, needs purchase and payment patterns of, and credit
`terms, pricing of special relations with, the customers of the
`Company or any of its Affiliates; (e) information concerning the
`identity, net prices and credit terms of, and special relations with,
`the suppliers of the Company or any of its Affiliates; or (f) any
`other confidential information which the Company or any of its
`Affiliates may reasonably have the right to protect by patent,
`copyright or by keeping it secret and confidential.
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`47.
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`OT and Barney later negotiated an Amendment to the Employment Agreement
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`(the “Amendment”), which revised Section 6.9 of the Employment Agreement but made no
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`changes to Section 5.2. Barney executed the Amendment on or about July 28, 2008. A true and
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`correct copy of the Amendment is attached hereto as Exhibit I.
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`48.
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`Barney is also party to the CAP Agreement, which he executed on or about April
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`27, 2007, wherein he agreed that “[n]o alterations, upgrades, or modifications should be made to
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`hardware and software purchased by the organization and provided to the employee.” A true and
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`correct copy of the CAP Agreement is attached hereto as Exhibit J. Barney further agreed that
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`OT retained ownership of all hardware and software provided to him.
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`OT’s Additional Measures to Maintain the Confidentiality of Its Information
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`49.
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`In order to maintain the confidentiality of its information, OT, as a matter of
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`practice and policy, requires employees to execute agreements containing confidentiality
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`provisions the same as or nearly identical to the one in Barney’s Employment Agreement.
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`50.
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`In addition, OT restricts access to its confidential information to certain key
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`individuals and only on a need-to-know basis. For example, OT’s financial information and
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`strategic business plans are distributed only to OT’s Managing Directors. Customer-related
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`confidential information is provided only to employees who work with that particular customer.
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`Barney’s Departure from OT and Destruction of the Laptop’s Hard Drive
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`51.
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`On or about February 14, 2011, Barney resigned from OT as a Managing
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`Director.
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`52.
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`Notwithstanding the fact that OT owned the Laptop, Barney did not return the
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`Laptop to OT at the time of his resignation.
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`53.
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`On multiple occasions, OT demanded that Barney return the Laptop. Barney
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`refused to comply with any of these requests.
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`54.
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`On or about June 14, 2011, approximately four months after he resigned from OT,
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`Barney finally returned the Laptop to OT.
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`55.
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`Upon receiving the Laptop from Barney, OT hired a forensic expert, who
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`analyzed the Laptop and determined that the hard drive on the Laptop had been intentionally
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`overwritten or wiped with hexadecimal “00” values. By overwriting or wiping the hard drive’s
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`data storage area on the Laptop, Barney rendered the data on the entire hard drive unrecoverable,
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`which thereby destroyed all the data on the hard drive. As such, Barney permanently destroyed
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`and rendered inaccessible all OT information on the Laptop’s hard drive, including, without
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`limitation, OT’s confidential information regarding OT’s strategic plans, financial performance,
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`and customers.
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`56.
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`In addition to completely erasing the hard drive of the Laptop, Barney, upon
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`information and belief, made a copy of the Laptop’s hard drive before erasing it. That copy has
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`not been provided to OT. Upon information and belief, Barney continues to access and use data
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`from the copied hard drive, including OT’s confidential financial and business information.
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`Barney Refuses OT’s Request for Compliance with the Employment Agreement and the
`CAP Agreement
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`57.
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`Upon receiving the Laptop back from Barney and learning from its hired forensic
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`expert that the hard drive on the Laptop had been wiped clean, OT sent a letter to Barney on July
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`6, 2011 reminding him of his contractual obligations in the Employment Agreement and in the
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`CAP Agreement. A true and correct copy of the July 6, 2011 correspondence is attached hereto
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`as Exhibit K.
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`58.
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`In the July 6, 2011 letter, OT requested that Barney explain the circumstances
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`surrounding the destruction of data on the Laptop; identify and return all OT files, data and
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`information remaining in his possession (whether originals or copies); and disclose the means by
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`which Barney had access to OT’s files, data and information since his resignation from OT.
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`59.
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`To date, Barney has not responded to OT’s July 6, 2011 letter, nor has he
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`complied with any of the requests made by OT in that letter.
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`PR’s Initial Allegations of Breach
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`60.
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`On January 5, 2012, PR sent to OT a demand to inspect OT’s books and records
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`pursuant to Section 4.5(c) of the License Agreement on January 19, 2012. A true and correct
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`copy of the January 5, 2012 demand is attached hereto as Exhibit L.
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`61.
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`Despite PR’s demand, OT and PR representatives convened on January 19, 2012,
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`but PR did not engage in the requested inspection or even raise the issue.
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`62.
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`Despite this, on January 26, 2012, PR sent a letter to OT in which PR asserted that
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`OT was in breach of the License Agreement for failure to comply with Section 4.5(c) of the
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`License Agreement. A true and correct copy of PR’s January 26, 2012 letter is attached hereto
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`as Exhibit M.
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`63.
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`On January 26, 2012, PR sent a second notice alleging that OT had breached
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`Section 4.3 of the License Agreement by failing to pay royalties on 12 specific reports in which
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`OT used the PatentRatings Analysis. A true and correct copy of PR’s second January 26, 2012
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`letter is attached hereto as Exhibit N.
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`OT Addresses PR’s Allegations Regarding Allegedly Withheld Payments
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`64.
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`OT promptly responded to PR’s accusations of breach by letter dated January 30,
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`2012, a true and correct copy of which is attached hereto as Exhibit O.
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`65.
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`In the January 30, 2012 letter, OT explained to PR that 10 of the 12 reports
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`identified in PR’s January 26, 2012 letter were “intellectual property appraisals” which, under
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`the License Agreement as amended on July 19, 2007, were not subject to any revenue-sharing
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`obligation. (Ex. O.)
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`66. With respect to one of the other two reports identified in PR’s January 26, 2012
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`letter, OT explained that “no invoice was charged or revenues received” for the report, noting
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`that the report was prominently marked as a “SAMPLE.” (Ex. O.)
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`67. With respect to the final report, OT acknowledged “an inadvertent failure to pay a
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`revenue share,” enclosed the invoice at issue and assured PR that the error would be promptly
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`corrected. (Ex. O.)
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`68.
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`OT made it clear that there was no evidence of a “systematic and deliberate
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`breach,” as alleged by PR in the January 26, 2012 letter, and expressed OT’s understanding that
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`the January 30, 2012 letter resolved any and all asserted breaches under the License Agreement
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`alleged by PR. (Ex. O.)
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`69.
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`On February 6, 2012, OT and PR held a meeting in which a number of issues
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`pertaining to the parties’ business relationship were discussed, including the License Agreement.
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`70.
`
`In response to OT’s January 30, 2012 letter, and in follow-up to the February 6,
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`2012 meeting, PR e-mailed OT on February 8, 2012. A true and correct copy of the February 8,
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`2012 correspondence is attached hereto as Exhibit P.
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`71.
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`In the February 8, 2012 e-mail, PR disputed OT’s interpretation of OT’s revenue-
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`sharing obligations with respect to the use of PatentRatings Tools in association with OT’s
`
`appraisal business. PR did not address any claimed breaches of the License Agreement except
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`for the appraisal issue. (Ex. P.)
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`72. While OT continued to disagree with PR’s position on this issue, in consideration
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`of the long-standing business relationship between the parties and in the spirit of good faith, OT
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`paid under protest all revenues (totaling $9,046.83) claimed by PR with respect to the use of the
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`PatentRatings Tools in association with OT’s appraisal business.
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`73.
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`Following OT’s payment of these disputed amounts, OT is not in breach of the
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`License Agreement with respect to the use of PatentRatings Tools in association with OT’s
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`appraisal business. In other words, OT has paid royalties to PR for all reports for which PR
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`claims it is due royalty payments.
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`OT Addresses PR’s Allegations Regarding PR’s Audit and Inspection Rights
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`74.
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`In response to P