10Q From Notes to Condensed Consolidated Financial Statements

Intellectual Property Rights

PDS, our investment in affiliate, relies on a combination of patents, trademarks, copyrights, trade secret laws, confidentiality procedures and licensing arrangements to protect our intellectual property rights. PDS currently licenses four unexpired U.S. patents issued dating back to 1997 on our microprocessor technology in addition to three European and two Japanese patents. The U.S. patents will expire between 2014 and 2015 and the European and Japanese patents will expire in 2016. PDS also licenses three U.S. patents, six European, and one Japanese patent all of which expired between August 2009 and June 2013. These patents, while expired, may have certain retrospective statutory benefits that will fully diminish six years after the patent expiration date (e.g. for the expired U.S. patents). The patent useful life for purposes of negotiating licenses is finite and these patents are subject to legal challenges, which in combination with the limited life, could adversely impact the stream of revenues. A successful challenge to the ownership of the technology or the proprietary nature of the intellectual property would materially damage business prospects. Any issued patent may be challenged and invalidated

p.10

http://www.sec.gov/Archives/edgar/data/836564/000101968713003875/patriot_10q-083113.htm

I don’t remember seeing this note in prior 10Q

Corrections welcome