Strategy in TECH...
While many things have changed in the wake of Joe Kiani’s exit from Masimo Corporation (Nasdaq: MASI) – and many more changes are likely still to come – one thing continues on, the many lawsuits existing between Masimo and Apple Inc (Nasdaq: AAPL). And in the last few days, we have learned of two significant developments in that regard. One is a significant win for Masimo…and the other a significant win for Apple.
However, the war between these combatants continues…
In a public press release and a filing with the Securities and Exchange Commission (SEC), Masimo Corporation (Nasdaq: MASI) revealed that CEO, Chairman and Founder Joe Kiani resigned his position as CEO on September 19, 2024, in the wake of learning that William Jellison and Darlene Solomon, both Politan nominees, had been elected to the Board of Directors by a decisive margin. The Board has appointed an interim CEO and launched a search for a new permanent CEO.
It was a long bloody battle and the outcome was less predictable this time around, due to allegations of vote manipulation and a high intensity – if often misguided – vigorous defense put on by Masimo CEO Joe Kiani and his management team. But now we know the result – Masimo shareholders voted in both of the Politan-backed candidates for nomination to the Board in a sweeping win for activist investor Quentin Koffey and Politan Capital Management. Chairman Joe Kiani, on the other hand, lost his Board seat.
Despite explosions going off everywhere all around the combatants, Masimo Corporation’s 2024 Annual Stockholders Meeting will in fact take place as rescheduled tomorrow, September 19, 2024. It has been a long and bloody battle to get to this point and it is not entirely clear who will prevail. But both sides took a last shot at reaching out to investors to try and gain their votes.
Politan’s swing was a little more powerful as it announced it would expand its lawsuit in the Delaware Court of the Chancery – with a new party to be sued, based on evidence it uncovered as part of Masimo’s lawsuit against it in California District Court.
Last Friday, just hours after I reported to you on what appeared to be a significant “win” for Politan Capital Management L.P. et. al. in its proxy battle with Masimo Corporation, a new ruling is handed down from U.S. District Court Judge James V. Selna in which he holds Politan and its Chief Investment Officer Quentin Koffey in Contempt of Court based on a Masimo Ex Parte motion. Judge Selna’s ruling showed some real anger at Koffey and Politan and he has scheduled a new hearing on the sanctions to be administered in the matter, although at this moment, Masimo’s Annual Stockholders Meeting is scheduled to go ahead with its proxy vote this Thursday.
Late on Thursday, Politan announced that Judge James V. Selna of the U.S. District Court, Central District of California has denied Masimo’s request for a preliminary injunction in the matter of Masimo Corporation v. Politan Capital Management et.al. that sought to block Politan’s nominees for the Masimo Board of Directors. This is a big win for Quentin Koffey and Politan as it means that despite Masimo’s effort to disqualify its candidates, they remain eligible to run for the open Board positions and that the vote by investors can continue as planned at the Masimo 2024 Annual Stockholders Meeting, scheduled less than a week away, on Thursday, September 19, 2024.
New proxy material produced and distributed to stockholders this week by Politan Capital Management – an activist investor in Masimo Corp (Nasdaq: MASI) – mostly contains information that was already known. The activist investor, as well as Masimo itself, must provide new proxy materials and voting forms as all previous votes were invalidated as a result of a rescheduling of the 2024 Annual Stockholders Meeting to September 19th (originally was to be July 25th).
But Politan included a few pages of updated background information which, among those items I’ve already written about, did include one fascinating or tantalizing bit of new information.
The judge hearing Lutron Electronics’ appeal of its loss to GeigTech East Bay (part of J. Geiger shades) in a patent infringement case has delivered her decision and it is sure to please neither side. Earlier this year a jury declared Lutron a willful infringer of a GeigTech patent and awarded it an eye-popping $34.6 million. Lutron appealed asking for a new trial, which was denied, but the Judge cut the award to $3.8 million, agreeing that it was “grossly excessive.”
So what happens now? Read on to see…
In the matter of Snap One, LLC v. AVA, Inc, and Josh.ai, Inc., we finally see a substantive move after the initial filing by plaintiff Snap One and subsequent answers from the defendants AVA and Josh.ai. And that subsequent move is a doozy – Josh.ai has gone on offense and filed a motion to dismiss multiple major claims in the Snap One lawsuit.
Josh.ai’s filing is well written and puts Snap One on defense, forcing them to submit genuine facts and evidence to support their many claims, including a few allegations that were really quite salacious.
Santos Electronics Inc., dba OSD Audio, and Outlaw Audio LLC – both direct-to-consumer (DTC) brands – have settled all claims between them in their dueling lawsuits that began back in 2022, according to court filings from earlier this year. In that order from the court, I learned that the entire action was dismissed “with prejudice” – meaning it cannot ever be revised or otherwise litigated again (on these issues).
