NEW YORK – On Friday, Worlds Inc. (OTCBB:WDDD) announced that it has started a private placement of non-convertible debt with some of the company’s largest shareholders. The non-dilutive structure is expected to provide Worlds with enough operating cash through the anticipated hearing against Activision (NASDAQ:ATVI).
In an announcement to investors, Worlds CEO Thom Kidrin said “the favorable response to the financing by some of our largest shareholders speaks to their ongoing support of Worlds and their belief in a favorable outcome to our patent infringement litigation against Activision due to the strength of our position and the recent actions by the U.S. Patent & Trademark office related to our patents.”
In September, the USPTO issued Certificates of Correction amending Worlds’ 6,219,045 and 7,181,790 patents to include comprehensive priority information, which specifically references Worlds’ November 1995 provisional patent application and confirms World’s 1995 priority date.
On October 17, a Motion for Summary Judgment (MSJ) hearing was held regarding Activision’s dispute of World’s November 1995 priority date, and both sides are awaiting a response from the judge to decide the next steps. If Activision were to lose, it could face millions in damages as some of its patents would have conflicted with Worlds’ claims.
In early October, Activision Publishing, a subsidiary of Activision filed a lawsuit claiming patent infringement against Worlds Inc. and Worlds Online Inc., in the U.S. District Court for the Central District of California. Activision alleges that Worlds violates U.S. Patent No. 6,014,145 entitled “Navigation with optimum viewpoints in the three-dimensional workspace interactive displays having three-dimensional objects with collision barriers” and U.S. Patent No. 5,883,628, entitled “Climability: property for objects in 3-D virtual environments.”
In early 2012, Worlds sued Activision in federal court for infringing patents that are based on Worlds’ November 1995 provisional patent application. The outcome of both cases would have a big impact on the future of Worlds, as the company struggles to monetize its 3D world technology. Worlds was founded in 1994, but some analysts have labeled it as a patent troll and see the lawsuit against Activision as an attempt to disrupt Activision’s business model.
Shares of Activision are up more than 64 percent year-to-date, but investors should take a deeper look at Worlds’ claim before deciding to take a deeper position in the company.
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