Mar. 19 at 11:43 AM
$IOT The 10-K report disclosed on March 17 revealed that a settlement regarding Motive’s fraudulent advertising was reached through JAMS on February 3. The settlement amount to be paid by Motive is
$30 million, which will be recognized in the first quarter. This represents a
$0.05 per share boost under GAAP. Although the earnings call mentioned the possibility of a slight GAAP loss in the first quarter due to seasonal factors, I believe the company will post a profit when the settlement is factored in. Regarding the theft of trade secrets—Motive’s core issue—the fact that unauthorized access related to advertising has been acknowledged will likely make it easier to prove in court. Since the fraudulent advertising settlement is
$30 million, the trade secret theft case could potentially amount to around
$300 million. That’s a massive
$0.50 per share. Furthermore, since Motive is facing financial difficulties, its very ability to continue operations is in doubt.
