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Victor,
Great spot, as always. I couldn’t resist the temptation to buy one or two of the documents. It’s another great illustration, if the allegations of the plaintiff, Connor Blier, are to be believed of just how dysfunctional and unethical Livingbridge/ Sycurio are, and of who is calling the shots.
According to the plaintiff, Livingbridge is making all the important decisions at Sycurio, which confirms what we strongly suspected. For instance, four out of the five directors of Sycurio Inc are Livingbridge employees. Mr Blair joined Sycurio US as VP marketing in January 2022 on a salary of $200,000 with an “Incentive Bonus” of up to 20% if he was still employed a year later. He was also promised “sweet equity of 6,000 shares upfront”, whose value former Sycurio CEO, Gary Barnett, apparently told him was forecasted to be approximately $900,000 “upon an eventual exit”. Although the complaint does not state it, these share would have been in Yale Topco Ltd, Sycurio’s ultimate holding company, incorporated in the tax haven of Jersey.
Surprise, surprise: Mr Blair, despite repeatedly asking for it and complaining he hadn’t received it, never did get his “sweet equity”; he did, however, get a special New Year’s present from Livingbridge/Sycurio: the sack in January 2023, five days before he would have become entitled to his “Incentive Bonus”.
Mr Blair’s complaint offers some illuminating insights into how Livingbridge has been “developing” Sycurio’s business. Livingbridge/Sycurio “misrepresented to him [Mr Blier] their available products and services, the functionality and viability of existing products and services, and the existing sales pipeline.” And “In response to his complaints….[Livingbridge/Sycurio] began to strip Blier of resources necessary to perform his job, including by reducing his monthly advertising budget by approximately seventy present (70%), by reducing Blier’s team from five (5) to three (3), and by eliminating the 2022 marketing pipeline production budget”. The Livingbride/Sycurio response to Mr Blier’s demand for his “Incentive Bonus” and compensation for the “sweet equity” he never got will make interesting reading.
According to records at the Companies Registry in Jersey, Mr Barnett held at one point 31,131 “sweet equity” shares in Yale Topco Ltd. If these would have been worth what Mr Barnett apparently told Mr Blier his “sweet equity” was forecast to be worth on “eventual exit” that comes to nearly $4.7m. This begs the question of why Mr Barnett walked away from such sweet “sweet equity” in May 2022.
Of course, the very use in the same sentence of Livingbridge/Sycurio with the phrase “sweet equity is extremely problematic. Based on the valuation forecast given to Mr Blier, Sycurio’s entire equity would be worth in excess of $350m on “eventual exit”. Utterly risible. As Livingbridge/Sycurio continue to butcher the IP p
Victor,
Looks like we are not going to get to see the arbitrator’s ruling in the Eckoh/Semafone case unless PCIP files another motion.
I share your bafflement about ‘timid’ Tim. Doesn’t strike me as a shrinking violet on the basis of that video, and loves to talk.
In this case, in my view, the perception of the value of patents to third parties (eg, investors) is as important as the reality, not that there is necessarily always a divergence, as seems to be suggested.
Livingbridge has made the protection of Sycurio’s IP the ostensible reason for the legal actions against PCIP. “As a pioneering technology company, it is essential that we defend our IP so that we can confidently invest in new technologies and grow with our partners for the benefit of customers across the world”, said Sycurio’s CEO after the High Court defeat.
The aggressive legal action taken against PCIP to “defend” Sycurio’s IP will almost certainly lead to that IP’s invalidation, which, absent the infringement proceedings, would not have happened. If Sycurio were to turn out to be not a pioneering technology company but a copycat (or worse), then perceptions and reality would, without doubt, coalesce. What would be the value of Sycurio then? Less than PCIP’s current market cap, in my view. And Livingbridge would be looking at a write-off north of £80m.
(As an aside, I am really struggling to see any evidence of Sycurio’s business development under Livingbridge’s ownership. Sales in 2022, Livingbridge’s first full year of ownership, were up about 5% over 2021, but staff turnover, especially at a senior level, has rocketed.)
A few things:
1. In my view, there is as much chance of PCIP blinking as there is of the four named inventors on the US patents being those patents’ only inventors.
2. Livingbridge as the owner of Sycurio is the one in the driving seat on the legal cases. It boasts on its website that: “We are clear on how we add value and are not afraid to make the calls that ensure we deliver winning outcomes”. Except, clearly, they aren’t clear. Was it a “call” to allow a relatively elderly and dyslexic widow to give expert evidence in the UK case on technical matters on which she was not expert? This meant Sycurio’s patent infringement case and patent validity defence had no chance of success; indeed, the infringement proceedings could not have been brought to trial without her “expert” evidence.
3. The careers of the Livingbridge executives responsible for the UK court disaster should be on the line. If so, in a bid to defeat the inevitable, they will throw a few more Hail Mary passes (ie, appeal the UK judgment and continue the US case). If their careers are not on the line, then Livingbridge must condone incompetence as well as dubious ethics (see PCIP's RNS of 7th June "Breach of Confidentiality Agreement", which involved personnel from Livingbridge).
4. Does Livingbridge have a disaster recovery plan for when Sycurio’s IP portfolio is decimated, as looks almost inevitable with its 4 disputed US patents likely to be invalidated before trial, and for when the value of Sycurio is reduced to less than Livingbridge's related bank debt, if it has not already been? Judged by its strategic and tactical ineptitude to date, if Livingbridge does have one, the plan will be one that will have arisen serendipitously rather than by design.
Victor,
Sycurio's US lawyers are clearly getting testy. They are upset that PCIP's lawyers have both filed a copy of Mrs Justice Bacon's judgment and claimed that is supportive of PCIP's on two claim construction issues in the US case
I doubt one of Mrs Justice |Bacon's judgment has been treated with such disdain before: ‘ and to the extent the Court even considers the UK Judgement, it should be afforded little, or no weight' harumph Sycurio's lawyers. PCIP's filing the UK judgment was also "procedurally improper" according to Sycurio's lawyers, as they had alleged with PCIP's filing (under seal)last month of the arbitrator's ruling on claim construction issues from the Sycurio/Eckoh arbitration case.
In addition, Sycurio lawyers say " Even assuming that the UK Judgement was entitled to any consideration here, Sycurio anticipates seeking permission to appeal the UK Judgement. Accordingly, additional proceedings regarding
the UK Patent are expected to follow and the issues addressed in the UK Judgement may not be fully resolved at this time."
Victor,
How could one forget that Gary left with his millions a year later? I suppose Gary’s “highly sucessful exit” must have been accompanied by a “highly successful entrance” from Livingbridge, if everyone at the party got a balloon. So why did Gary’s balloon pop after just one year? Did he burst it himself, or did Livingbridge insert a pin? And why?
Victor,
It’s worth remembering that Gary cleaned up to the extent of around £3.4m from the “successful
exit”.
As for the four supposed patent inventors, their haul was: David Jackson & Richard Cooper-Driver around £5m each; Tim Crichtley around £4m; and Andy Tew about a “meagre” £0.4m.
Victor,
The real growth area is in the net debt of Sycurio and its holding companies: up from £116.8m at 31/12/2021 to £128.7m at 31/12/2022.
Also remarkable that the bank loans in the Sycurio group at 31/12/2022 of £29.77m just exceed the market capitalisation of PCIP!
‘When I use a word,’ Humpty Dumpty said in a rather scornful tone, ‘it means just what I choose it to mean—neither more nor less.’
As with Humpty, so with Mathys & Squire, Sycurio’s patent attorneys. This is one of the impressions I am left with after reading Sycurio’s recent reply to PCIP’s/Eckoh’s objections to one Sycurio’s European patents (EP2286576): words/phrases mean whatever Mathys says the ‘skilled person’ would say they mean. So, for instance, and very obviously, a ‘verification message’ means exactly the same as a ’confirmation signal’. In a similar vein, where Eckoh’s lawyers pointed out key wording is absent from the patent, Mathys accuses them of ‘drawing unwarranted conclusions from the absence of specific wording in the application as filed’. And then helpfully adds: ‘The applicant is of course free to use whatever words they wish in a patent application to convey the workings of the invention.’ Quite.
A rather sizeable problem for Livingbridge/Sycurio is that the EPO has already decided some of the issues in play with EP2286576 with its decision to revoke one of Sycurio’s European patents earlier this year. At least three of the claims in the revoked patent that were found by the EPO to be ‘unallowable generalisations’ or ‘not disclosed in the application as filed’ are also present in EP2286576.
Then comes the question of obviousness. In its latest submission, Mathys reheats the same arguments that it has used twice before about the inventive step in disputed Sycurio patents over Van Volkenberg, a US patent from 2004. The first time was when the UK IPO raised an objection in 2011 that the invention claimed in the UK patent was obvious in view of Van Volkenberg, and the second time was when the EPO raise the same objection in 2017 in respect of what is now EP2286576, the closest of Sycurio’s European patents to the UK one.
In its latest offering, Mathys blithely opines: “Crucially, the opponents have not demonstrated why the skilled person would have sought to combine teachings from specific documents or shown how the combination would have resulted in the claimed invention.”
As we know PCIP, did just that for Sycurio’s UK patent, using expert witness, in the UK court case. Mrs Justice Bacon found that “Claim 9 [of the UK patent] is obvious over Van Volkenberg.” Van Volkenberg is one of the patents cited by Eckoh/PCIP in the EPO proceedings.
Victor,
PCIP’s no reply brief was a no reply to Sycurio’s reply to PCIP’s filing about the arbitrator’s confidential claim construction ruling in the Sycurio/Eckoh arbititration. I guess PCIP hasn’t got anything to add to its initial filing, in which it filed the arbitration ruling under seal & asked the judge to make it public. PCIP has drawn the arbitration ruling, which it says supports its case (this is disputed by Sycurio), to the judge’s attention. I guess there’s not much more to say. Irrespective of whether the arbitration ruling is made public or not, the judge will have to decide whether to take it into account in his own forthcoming claim construction ruling. It would be a bonus if the arbitration ruling were made public.
Victor,
I intend to go through the filing but I guess it is all about keeping up appearances, as you suggest. It also conveniently kicks this EPO case into touch (for up to a year would be my guess).
I think more new infornation will surface but its production is being held up by illness. However, I doubt the three inventors have been questioned yet; hopefully that will happen soon.
Victor,
Thanks very much. I had ‘t seen that stuff on licensing. All but the one with Automated Transaction Services were still in place when Livingbridge took over Sycurio in 2021, according to records at Companies House.
Victor,
Thanks. Yes, I saw that. All the pages relate to Semfone 1 rather than Semafone 2, I think. I also see that Tim Critchley’s name appears on the “Contact US” link. The bit you quote must have been written in (late?) 2008, I think.