Nuance Acknowledged Vianix Actions

In the 10-Q filing by Nuance on June 30, 2009 Nuance acknowledged the pending lawsuit by Vianix - on Page 24 you can find the following:

Vianix LLC has filed three legal actions against us, consisting of two breach of contract actions and a copyright infringement claim. It is too early for us to reach a conclusion as to the ultimate outcome or proposed settlement of these actions or to estimate the potential loss that could result from a settlement or adverse judgment against us in these matters. However, we believe that we have substantial defenses against these claims, and intend to defend them vigorously.

We do not believe that the final outcome of the above litigation matters will have a material adverse effect on our financial position and results of operations. However, even if our defense is successful, the litigation could require significant management time and will be costly. Should we not prevail, our operating results, financial position and cash flows could be adversely impacted.

Needless to say the the usual rhetoric "suit without merit", "we will prevail" etc. But you have to question why a company would take on sue a large corporation and invite a host of legal costs and aggravation if they did not have a case. In one of the suits Vianix claims Royalties of $20 - 30 Million in unpaid licenses. While that number may be a small drop in the ocean to Nuance the impact of a loss and the potential for an injunction preventing he use of the technology in the interim could be quote devastating.

In addition to this there is an Antitrust investigation, recently confirmed to be focusing on the potential monopoly following the acquisition of the Philips Speech Engine by Nuance. This represents some significant challenges to the organization which are frequently covered in ASR News from Walt Tetschner

Watch this space!