Decision Announced in eSpeed-Trading Technologies Patent Case
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A U.S. District Court for the Northern District of Illinois jury found
on October 10, 2007 that certain versions of eSpeed, Inc.’s
futures-trading software (NASDAQ:ESPD), last used in 2004, infringed
Trading Technologies International’s patents,
and that patents asserted by Trading Technologies were not invalid on
certain grounds. The jury assessed damages for the infringement in the
amount of $3.5 million.
Howard W. Lutnick, Chairman, CEO and President of eSpeed, said, "This
decision has absolutely no effect on eSpeed’s
suite of products, nor does it have any effect on our business or
products. All of eSpeed’s current products
have already been found to not infringe the patents that were litigated
in this case, and today’s verdict, which
addressed a minor three-year old matter covering only the period of
August to December 2004, has no bearing on our products.”
The U.S. Patent and Trademark Office announced on August 1, 2007 that it
would reexamine patents held by Trading Technologies in light of "substantial
new questions of patentability”, reinforcing
eSpeed’s view that Trading Technologies’
patent claims are unsupportable.
The Court has yet to try certain issues relating to the validity and
enforceability of the patents, any of which could eliminate the
judgment. eSpeed will present additional arguments that the patents are
invalid, and will also present evidence that the patents cannot be
enforced due to inequitable conduct by Trading Technologies. The Court’s
decision on these matters will probably occur in the next few months.
The case in question is Trading Technologies International Inc. v.
ESpeed Inc., 04cv5312, U.S. District Court for the Northern District of
Illinois.
About eSpeed, Inc.
eSpeed, Inc. (NASDAQ: ESPD) is a leader in developing and deploying
electronic marketplaces and related trading technology that offers
traders access to the most liquid, efficient and neutral financial
markets in the world. eSpeed operates multiple buyer, multiple seller
real-time electronic marketplaces for the global capital markets,
including the world's largest government bond markets and other fixed
income and foreign exchange marketplaces. eSpeed's suite of marketplace
tools provides end-to-end transaction solutions for the purchase and
sale of financial products over eSpeed's global private network or via
the Internet. eSpeed's neutral platform, reliable network,
straight-through processing and superior products make it the trusted
source for electronic trading at the world's largest fixed income and
foreign exchange trading firms and major exchanges. To learn more,
please visit www.espeed.com.
On May 29, 2007, eSpeed announced that it had entered into an Agreement
and Plan of Merger, dated as of May 29, 2007 with BGC Partners, Inc. ("BGC
Partners”); Cantor Fitzgerald, L.P. ("Cantor”);
BGC Partners, L.P., a Delaware limited partnership; BGC Global Holdings,
L.P., a Cayman Islands exempted limited partnership; and BGC Holdings,
L.P., a Delaware limited partnership pursuant to which eSpeed will
acquire BGC Partners through a merger of BGC Partners with and into
eSpeed. For more information, see eSpeed’s
Report on Form 8-K dated May 29, 2007.
Important Information
In connection with the proposed Merger, the Company intends to file a
proxy statement and related materials with the U.S. Securities and
Exchange Commission (the "SEC”)
for the meeting of stockholders to vote on the proposed Merger. BECAUSE
THOSE DOCUMENTS WILL CONTAIN IMPORTANT INFORMATION, HOLDERS OF THE
COMPANY’S COMMON STOCK ARE URGED TO READ THEM
CAREFULLY, IF AND WHEN THEY BECOME AVAILABLE. When filed with the SEC,
the proxy statement and related materials will be available for free
(along with any other documents and reports filed by the Company with
the SEC) at the SEC’s website, www.sec.gov,
and at the Company’s website, www.espeed.com.
Participant Information
The Company and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the Company’s
stockholders in connection with the proposed Merger. Certain information
regarding the participants and their interests in the solicitation are
set forth in the Company’s Annual Report on
Form 10-K/A for the year ended December 31, 2006, which was filed with
the SEC on August 23, 2007, and will be set forth in the proxy statement
for the Company’s meeting of stockholders to
vote on the proposed Merger. Stockholders may obtain additional
information regarding the proposed Merger by reading the proxy statement
and the related materials relating to the proposed Merger, if and when
they become available.
Discussion of Forward-Looking Statements
The information in this release contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such statements are based upon current expectations that
involve risks and uncertainties. Any statements contained herein that
are not statements of historical fact may be deemed to be
forward-looking statements. For example, words such as "may,” "will,” "should,” "estimates,” "predicts,” "potential,” "continue,” "strategy,” "believes,” "anticipates,” "plans,” "expects,” "intends”
and similar expressions are intended to identify forward-looking
statements.
The actual results of eSpeed, BGC or the combined company in the merger ("we”,
"our” or the "combined
company”) and the outcome and timing of
certain events may differ significantly from the expectations discussed
in the forward-looking statements. Factors that might cause or
contribute to such a discrepancy for eSpeed, BGC and/or the combined
company include, but are not limited to, the combined company’s
relationship with Cantor and its affiliates and any related conflicts of
interests, competition for and retention of brokers and other managers
and key employees, pricing and commissions and market position with
respect to any of our products, and that of the combined company’s
respective competitors, the effect of industry concentration and
consolidation, and market conditions, including trading volume and
volatility, as well as economic or geopolitical conditions or
uncertainties. Results may also be impacted by the extensive regulation
of our respective businesses and risks relating to compliance matters,
as well as factors related to specific transactions or series of
transactions, including credit, performance and unmatched principal risk
as well as counterparty failure. Factors may also include the costs and
expenses of developing, maintaining and protecting intellectual
property, including judgments or settlements paid or received in
connection with intellectual property or employment or other litigation
and their related costs, and certain financial risks, including the
possibility of future losses and negative cash flow from operations,
risks of obtaining financing and risks of the resulting leverage, as
well as interest and currency rate fluctuations.
Discrepancies may also result from such factors as the ability to enter
new markets or develop new products, trading desks, marketplaces or
services and to induce customers to use these products, trading desks,
marketplaces or services, to secure and maintain market share, to enter
into marketing and strategic alliances, and other transactions,
including acquisitions, dispositions, reorganizations, partnering
opportunities, and joint ventures, and the integration of any completed
transactions, to hire new personnel, to expand the use of technology for
screen-assisted, voice-assisted and fully electronic trading and to
effectively manage any growth that may be achieved. Results are also
subject to risks relating to the proposed merger and separation of the
BGC businesses and the relationship between the various entities,
financial reporting, accounting and internal control factors, including
identification of any material weaknesses in our internal controls, our
ability to prepare historical and pro forma financial statements and
reports in a timely manner, and other factors, including those that are
discussed under "Risk Factors”
in each of eSpeed’s Annual Report on Form
10-K/A for the year ended December 31, 2006, which was filed with the
SEC on August 23, 2007 and BGC’s Registration
Statement on Form S-1 filed with the SEC on February 8, 2007
(Registration No. 333-140531) to the extent applicable.
We believe that all forward-looking statements are based upon reasonable
assumptions when made. However, we caution that it is impossible to
predict actual results or outcomes or the effects of risks,
uncertainties or other factors on anticipated results or outcomes and
that accordingly you should not place undue reliance on these
statements. Forward-looking statements speak only as of the date when
made and we undertake no obligation to update these statements in light
of subsequent events or developments.
