Saturday, December 03, 2005

The Drifting of Rambus by Empiricum

[This is a short story about The Drifting of Rambus. Unlike the Da Vinci Code, this story is not fiction but based on some facts from my reconstituted gnostic Rambus Diary which was shredded long time ago when I was cleaning up my garage over a pizza. As this story is not based on extensive research, therefore, the reader is urged to conduct the necessary due diligence on matters herein discussed which are not intended as investment or legal advice. Furthermore, I am a longtime Rambus investor, in the true sense of the word.]

On August, 2000, Rambus Inc. went into a litigation binge... and rightfully so. It fired the opening salvo in Virginia. Unfortunately, the case was assigned to the wrong courtroom with a judge who is now widely perceived to have an unmitigated bias against Rambus. Upon the announcement of the filing of that patent infringement case, the Rambus share of stock plummeted from the mid $70 range.

Then Rambus filed an injunction with the ITC which was questioned for "judge shopping" and was eventually withdrawn. The market reacted negatively once again.

Then came the suit in Delaware by MU that preempted Rambus. The stock went into a further dive.

Hynix (formerly Hyundai) followed suit in California. Now exposed and on the defensive, the 3 Amigos (who turned out to be 4, including Samsung) found a hired gun to battle for their cause before the FTC. The Rambus stock price went further adrift.

Then came the DOJ DRAM cartel investigations. As we all know by now, both moves blow up in the faces of the 4 Amigos ... thanks to the masterful lawyering of Gregory Stone and company.

Meantime, a group of fudsters , who called themselves "journalists," continued their unmitigated FUD on Rambus. One "reporter" even dared to leak the impending "ruling" of Judge Payne. Once out, the Rambus stock price which was then hovering in the mid 30s plummeted like a falling rock. It came down all the way to single digits. Down but not out, Rambus stood up reeling and staggering but regained consciousness when it won its appeal in the CAFC... thanks to the expertise of Judge Rader and the legal craftsmanship of Rambus appeal counsel Taranto.

The Rambus stock price lingered in the 20s until Judge McGuire of the FTC handed down his ID. Immediately, the stock price went back to the mid 30s. Then came the exercise of stock options by management and Rambus once again drifted... unable to move up even in the wake of a few licensing agreements and change of CEOs.

When the much-maligned IFX settlement was announced, the Rambus share of stock was at 17. Investors were lured back hoping that the settlement marks the beginning of the end of Rambus' legal woes. It turned out not to be so. Their hopes were refocused on Judge Whyte, who is expected to hand down a significant ruling this month.

Meantime, the share of stock lingered in the teens.... until the news about Samsung's guilty plea in San Francisco on the DOJ anti-trust case. Rambus boosters, led by no other than chief legal John Danforth, considered the news "positive" as it strengthens Rambus' claims in its own private anti-trust case against the amigos, sans IFX. As a result, those who bought in when the IFX settlement was announced, and thereafter, were simply waiting for the stock price to hit $18. That happened at or about 9:45 a.m. (eastern) last Friday... triggering a mini sell off amid rampant speculation and rumors, including an alleged unloading by Stuart Steele.

One "analyst" theorized that Friday's action was a result of the "fretting" of Rambus shareholders for lack of news in the Hynix case. Previous to that, another "analyst" misunderstood the implications of the Samsung guilty plea. What a fool ! His WD4O was degreased... right here on Treowth and all over the Rambus message boards. Like their predecessors, this new breed of Rambus fudsters simply cannot get their facts and theories straight!

No, Alexei. Last Friday's trading action was not due to the "fretting" of Rambus shareholders. As you will note from above, it is more of recovering and selling at the slimmest of profit pursuant to the "overheard theory"... if you have heard of that. The question now is: are we going to witness a similar event when the stock price reaches $38? And $78? It seems like 8 is wild in Rambus' future.

We shall see.

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