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A conversation with Desire2Learn's John Baker and Diane Lank
3/17/2008
Baker: No, but we do anticipate that we will be proactive in sharing with Blackboard that release, so that we can also put their mind at ease that this is a workaround. I think they indicated that they want us to have a workaround to continue to do business with our clients. We're going to take them up on that offer. So we're going to share with them what we've done: all of our documentation. We're going to make sure their expert--under a protective order--gets access to the source code and to the application. But it's only going to happen after our expert first gives an official stamp of approval that this is what we refer to as a workaround.
We're volunteering to do that; that's not something that we're forced to do by any stretch of the imagination. Blackboard does not have to approve this as a workaround. We made that determination.
Nagel: You also released it, what was it, about 58 days before the injunction [will go] into effect?
Baker: Yes, we did. Now keep in mind that 8.3 is a workaround candidate today, and it was released--I think you're right--about 58 days prior to the expiration of the stay. And the judge anticipated that. I mean, we told the judge we could have this workaround out within 30 days, and we believe that we're going to hit that. We hope that [it's] only two weeks before we officially call it a workaround.
Nagel: Okay, and what do you need to have happen to be able to make that call?
Baker: We're having our external expert take a very close look at all of the things that Blackboard was claiming that we were infringing. And then they [can] take a very close look at all of our source code, documentation, the application, talk to our architect to ensure that he's comfortable how we've addressed the infringement that Blackboard's claiming.
Nagel: I'm going to ask you to get a little philosophical. Just assume the worst-case scenario where the patent stands, and you lose on appeal. What does it mean to you, and what does it mean to the LMS development community as a whole?
Baker: I think there's two things. One is from a financial perspective: $3.1 million is a lot of money, but it's certainly not putting us in any financial jeopardy whatsoever. We've been very fortunate to have incredibly strong clients over the years, some of which pay almost that much money as an individual client. So we've been very, very fortunate to have good clients and good cash flow--no debt--we've got a very strong cash position. So we could pay that, without actually skipping a beat, and continue to be profitable this year and going forward. So from a financial perspective, it's one of the concerns people have raised over [the course of the trial]. In the early days, $3.1 million was a lot of money for us. Today it doesn't even come close to our R&D budget within our organization.
So we're quite comfortable; we're still hiring a lot of people; we still intend on growing; we've obviously launched new products; and we're actually going to be launching more later in the year. So we're intent on keeping our innovative edge and [focusing on] the clients and client success.
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