The Plaintiff's Patent Lawsuit Background

Longitude Licensing Ltd. is a privately owned intellectual property management company that specializes in maximizing the value of patented intellectual property. Founded in July 2013, Longitude Licensing Ltd. and its affiliated companies own and manage portfolios totaling more than 6,500 semiconductor and storage solution patents and patent applications.

Longitude Licensing Ltd. operates by partnering with patent owners to manage and license patent portfolios. Affiliate Longitude Flash Memory Systems S.a.r.l. acquired from SanDisk Corporation ("SanDisk") a portfolio of patents, including the Patents-in-Suit, relating to flash memory systems. Longitude Licensing Ltd. is the exclusive licensee from its affiliated company of this SanDisk patent portfolio, with all rights to enforce the Patents-in-Suit.

Through its focus on innovation and developing cutting-edge technological solutions for the storage needs of its customers, SanDisk has established itself as the leading company in the flash memory industry. SanDisk is the worldwide market leader in flash memory products.

SanDisk's diverse product portfolio includes flash memory cards and embedded solutions used in smart phones, tablets, digital cameras, camcorders, digital media players and other consumer electronic devices, as well as USB flash drives and solid-state drives ("SSDs") for the computing market. SanDisk's products are used by consumers and enterprise customers around the world.

Since 1988, SanDisk's innovations in flash memory and storage system technologies have provided customers with new and transformational digital experiences. Throughout its history, SanDisk has pioneered the use of flash memory technology. In 1991, SanDisk (then called "SunDisk") began shipping the world's first flash-based SSD, more than a decade before flash SSDs were widely used. Similarly, in 1999 SanDisk introduced the first high volume memory with Multi- Level Cell ("MLC") technology which doubled the amount of data stored in each memory cell. In 2013, SanDisk celebrated its 25th anniversary and a quarter century of innovation, research and development in flash memory.

SanDisk's commitment to innovation continues through its investment in new technology and products. For the fiscal year of 2013, SanDisk's investment in research and development exceeded $700 million. Of SanDisk's 5,459 employees, nearly half—2,487 employees—are dedicated to research and development of new technologies and products.

SanDisk's success at innovation continues to be recognized by the industry. In 2013, SanDisk was recognized by Thomson Reuters for the third year in a row as a "Top 100 Global Innovator" for its role as a global leader in flash memory storage solutions. In 2012 and 2013, SanDisk was recognized by IEEE Spectrum magazine as a top company with "Patent Power" in the semiconductor manufacturing field.

SanDisk's investment in memory technology has also yielded an extensive patent portfolio. At the end of the 2013 fiscal year, SanDisk's investment in memory technology had generated a portfolio of more than 2,600 U.S. Patents. And SanDisk holds more than 4,900 patents worldwide. SanDisk's patent portfolio has been licensed by several leading semiconductor companies and other companies in the flash memory business. In early 2014, SanDisk reached a milestone of recognizing over $4 billion in cumulative licensing and royalty revenue.

Through its licensing activities SanDisk enables companies to benefit from the hundreds of millions of dollars the company annually spends on research and development. SanDisk's license agreements provide licensees the right to make, use and sell products that incorporate SanDisk's patented technology. SanDisk's licensing agreements also assure that SanDisk receives a fair return on its investment in research and development. SanDisk uses these royalties to fund further research and development in flash memory technology and systems, and thus continue to contribute to the flash memory industry that SanDisk pioneered.

SanDisk further continues to encourage innovation through its launch of SanDisk Ventures. SanDisk Ventures invests in early- to mid-stage companies that demonstrate innovative flash memory solutions, and strong intellectual property and management teams. SanDisk Ventures has invested over $75 million in at least five companies working on promising technologies.

The Lawsuit Files 13 Counts of Infringement against Apple

The patent infringement case brought against Apple by the plaintiffs includes 13 patents as noted here: 6,763,424, 7,970,987, 8,316,177, 6,968,421, 7,657,702, 7,818,490, 7,012,835, 6,831,865, 7,224,607, 8,050,095, 6,510,488, 7,181,611 and 7,120,729 as reflected in the graphic of below.

In the first count against Apple the plaintiff's state that "The lawsuit claims that Apple has infringed and continues to infringe one or more of the claims of patent 6,763,424 (the '424 Patent) in violation of 35 U.S.C. § 271 by making, using, selling, and/or offering to sell within the United States, and/or by importing into the United States, without authority, products using flash memory systems, including but not limited to the Apple iPad, Apple iPad 2, Apple iPad (3rd Generation), Apple iPad (4th Generation), Apple iPad Air, Apple iPad mini, Apple iPad mini with Retina display, Apple iPhone, Apple iPhone 3G, Apple iPhone 3GS, Apple iPhone 4, Apple iPhone 4S, Apple iPhone 5, Apple iPhone 5C, Apple iPhone 5S, iPod Touch 2G, iPod Touch 3G, iPod Touch 4G, and iPod Touch 5G, that are covered by one or more claims of the '424 Patent."

The patent infringement case presented in today's report was filed in the California Northern District Court, San Francisco Office The Presiding Judge in this case is noted as being Judge Elizabeth D. Laporte.

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