What changed in this filing

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Item 3. Legal Proceedings

2024-01-31 compared with 2023-02-01 · 59 added, 22 removed, 5 unchanged (94% of the section changed)

LEGAL PROCEEDINGS

Bell Semiconductor Litigation

On August 11, 2022, Bell Semiconductor LLC filed suit against MaxLinear in the Southern District of California alleging infringement of U.S.

6,436,807 and 7,007,259.

MaxLinear answered the complaint on January 26, 2023 and the case is presently early in the fact discovery phase.

The case is tentatively scheduled for trial in February 2024.

On August 26, 2022, Bell Semiconductor LLC filed suit against MaxLinear in the Southern District of California alleging infringement of U.S.

7,149,989 and 7,260,803.

MaxLinear answered the complaint on January 26, 2023 and the case is presently early in the fact discovery phase.

The case is tentatively scheduled for trial in February 2024.

On October 7, 2022 Bell Semiconductor LLC filed suit against MaxLinear in the Southern District of California alleging infringement of U.S.

This action has been stayed pending a parallel ITC investigation involving the same patent.

Specifically, on October 13, 2023, Bell Semiconductor also filed suit against MaxLinear before the U.S.

International Trade Commission alleging infringement of U.S.

This was instituted by the Commission as Investigation No.

337-TA-1342 on November 23, 2022.

A schedule was set by the administrative law judge and key deadlines include a close of fact discovery on May 1, 2023, a close of expert discovery June 5, 2023, and an evidentiary hearing beginning on August 7, 2023.

An initial determination is expected from the judge on November 21, 2023, with a final determination from the Commission by March 21, 2024.

Dispute with Silicon Motion

As previously disclosed, on July 26, 2023, MaxLinear terminated the Merger Agreement on multiple grounds.

On August 16, 2023, Silicon Motion delivered to MaxLinear a notice, which Silicon Motion publicly disclosed, that it was purporting to terminate the Merger Agreement and that Silicon Motion would be commencing an arbitration before the Singapore International Arbitration Centre to seek damages from MaxLinear arising from MaxLinear’s alleged breaches of the Merger Agreement.

Silicon Motion’s position is that MaxLinear’s Willful and Material Breaches (as such term is defined in the Merger Agreement) of the Merger Agreement prevented the Merger from being completed by August 7, 2023, and that MaxLinear is consequently liable for substantial monetary damages in excess of the termination fee as provided in the Merger Agreement.

On October 5, 2023, Silicon Motion filed a Notice of Arbitration with the Singapore International Arbitration Centre alleging that MaxLinear breached the Merger Agreement.

Silicon Motion seeks payment of the termination fee, additional damages, fees, and costs.

The arbitration will be confidential.

MaxLinear believes that it properly terminated the Merger Agreement.

MaxLinear remains confident in its decision and will vigorously defend its right to terminate the Silicon Motion transaction without penalty.

Class Action Complaint

On August 31, 2023, a Silicon Motion stockholder filed a putative class action complaint in the United States District Court for the Southern District of California captioned Water Island Event-Driven Fund v.

MaxLinear, Inc.

23-cv-01607 (S.D.

Cal.), against MaxLinear and certain of its current officers.

The complaint includes two claims:

(1) an alleged violation of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder;

and (2) an alleged violation of Section 20(a) of the Exchange Act.

The complaint alleges that the defendants made false and misleading statements and/or omitted material facts that MaxLinear had a duty to disclose, concerning the Company’s ability and intention to timely close the merger with Silicon Motion, including that:

(i) MaxLinear had allegedly decided it would not consummate the merger because the economic circumstances surrounding the merger had materially changed, including a material downturn in the semiconductor industry and rising interest rates;

(ii) MaxLinear had allegedly determined to unilaterally terminate the merger in the event the merger was approved by SAMR;

(iii) MaxLinear had allegedly intended to argue that certain conditions in Article 6 of the Merger Agreement had not been satisfied as required by May 5, 2023 as a basis to terminate the merger;

and (iv) as a result, MaxLinear had allegedly materially misrepresented the viability of the merger, the purported benefits of the merger, and the likelihood that the merger would be consummated.

The complaint seeks compensatory damages, including interest, costs and expenses and such other equitable or injunctive relief that the court deems appropriate.

MaxLinear will vigorously defend its position.

On December 20, 2023, the Court appointed the lead plaintiffs, who are expected to file an amended complaint by February 15, 2024.

Defendants expect to answer or move to dismiss by March 29, 2024.

Comcast Litigation

On December 1, 2023, MaxLinear filed claims against Comcast Management, LLC and Comcast Cable Communications, LLC (together, “Comcast”) in the United States District Court for the Southern District of New York.

MaxLinear alleges that in 2020, MaxLinear shared its proprietary design and know-how for a full-duplex, or FDX, amplifier with Comcast in the hope of securing future business with Comcast.

MaxLinear shared its design and know-how on several occasions, all pursuant to a non-disclosure agreement between MaxLinear and Comcast, with the expectation that Comcast would keep the information confidential.

Comcast needed this technology in order to effectively compete with fiber-optic internet providers.

Instead of engaging MaxLinear to develop the FDX amplifier, Comcast shared MaxLinear’s proprietary designs with MaxLinear’s direct competitor.

Comcast then worked with MaxLinear’s competitor to develop the FDX-amplifier technology.

MaxLinear brought claims for trade secret misappropriation, unfair competition, and breach of the parties’ non-disclosure agreement, and it sought an unspecified amount of compensatory damages, punitive damages, pre-judgment and post-judgment interest, costs, expenses, and attorney fees as well as an injunction against Comcast’s use or disclosure of MaxLinear’s trade secrets.

Dish Litigation

On February 10, 2023, Entropic Communications, LLC, or Entropic filed claims for patent infringement against Dish Network Corporation, Dish Network LLC, Dish Network Service, LLC, and Dish Network California Service Corporation (together, “Dish”).

At that time, MaxLinear was not a party to the action.

On September 21, 2023, Dish Network California Service Corporation (“Dish California”) filed four counterclaims against MaxLinear in the United States District Court for the Central District of California.

The four claims are declaratory judgment, breach of contract, fraud and negligent misrepresentation, and civil conspiracy.

Dish California alleges that when MaxLinear assigned certain patents to Entropic, MaxLinear violated its obligations owed to the Multimedia over Coax Alliance, or MoCA under MoCA’s Intellectual Property Rights (“IPR”) Policy.

Dish California alleges that MaxLinear also allegedly violated the MoCA IPR Policy by failing to offer Dish California a fair, reasonable, and nondiscriminatory, or FRAND, license for these patents.

Dish California seeks an unspecified amount of compensatory damages, disgorgement, attorneys’ fees, experts’ fees, and costs.

Cox Litigations

On October 6, 2023, Cox Communications, Inc., CoxCom, LLC, and Cox Communications California, LLC (together, “Cox”) filed claims in two separate actions against MaxLinear in the United States District Court for the Central District of California.

In the first action, in response to Entropic suing Cox for patent infringement, Cox filed counterclaims alleging that when MaxLinear assigned certain patents to Entropic, MaxLinear violated its obligations under MoCA’s IPR Policy by assigning these patents and by failing to offer Cox a FRAND license for these patents.

Cox amended its counterclaims on January 9, 2024 and is asserting claims of breach of contract, unjust enrichment, and declaratory judgment against MaxLinear.

Cox seeks an unspecified amount of compensatory damages, equitable relief, attorneys’ fees, expenses, and costs.

In the second action, in response to Entropic suing Cox for patent infringement, Cox filed counterclaims against MaxLinear.

Cox alleges that MaxLinear granted CableLabs a non-exclusive, royalty-free license to all patents essential for compliance with DOCSIS specifications.

It further alleges that MaxLinear breached this agreement when MaxLinear assigned certain patents to Entropic.

Cox amended its counterclaims on January 9, 2024 and is asserting claims for breach of contract, unjust enrichment, and declaratory judgment.

Cox seeks an unspecified amount of compensatory damages, equitable relief, attorneys’ fees, expenses, and costs.

The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

As of December 31, 2023, no material loss contingencies have been accrued for litigation and other legal claims in our consolidated financial statements, since our management currently does not believe that the ultimate outcome of any of the matters described above is probable.

An unfavorable outcome of these matters may be reasonably possible in excess of recorded amounts;

however, a reasonable estimate of the amount or range of such loss cannot be made at this time.

Other Matters

In addition, from time to time, we are subject to threats of litigation or actual litigation in the ordinary course of business, some of which may be material.

We record a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

We currently do not believe that the ultimate outcome of any of the matters described above is probable or reasonably estimable, or that these matters will have a material adverse effect on our business;

however, the results of litigation and claims are inherently unpredictable.

Regardless of the outcome, litigation can have an adverse impact on us because of litigation and settlement costs, diversion of management resources and other factors.

From time to time, the Company is subject to threats of litigation or actual litigation in the ordinary course of business as described in “Item 3 — Legal Proceedings,” some of which may be material.

Results of litigation and claims are inherently unpredictable.

Regardless of the outcome, litigation and claims can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors.

MINE SAFETY DISCLOSURES

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 3. Legal Proceedings