BlackBerry Ltd. (TSX:BB)(NYSE:BBRY) investors have experienced quite the roller coaster ride of late, following two recent court rulings relating to ongoing legal patent fights the software company has been engaged in, as well as conflicting analyst opinions on the long-term upside BlackBerry provides investors with in its bid to reinvent itself as a software-first profitability machine.
On Friday, BlackBerry’s management team announced it was on the losing end of an arbitration award handed to rival Nokia Corp. (NYSE:NOK) in the amount of $137 million. Shares of BlackBerry slipped 1.7% on the day following the news, as investors priced in the arbitration loss into their cash flow projections for the company.
The International Chamber of Commerce’s International Court of Arbitration made the final ruling with respect to a dispute between the two firms relating to whether payments related to a patent license contract were in fact owed to Nokia. The final decision has been accepted by BlackBerry, although the company has noted it will be continuing with litigation alleging infringement by Nokia on BlackBerry’s intellectual property.
BlackBerry’s patent portfolio has long been cited a key component of the company’s valuation – earlier this year, the company won an ongoing patent lawsuit with Qualcomm, Inc. (NASDAQ:QCOM) for nearly $1 billion. With BlackBerry’s transition toward becoming a pure play software company underway, the company’s continuing legal battles with competitors will be watched closely by analysts and investors alike, as the outcome of these pending matters will impact earnings significantly in the quarters and years to come.
Invest wisely, my friends.
