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Attorneys in the Palo Alto office of Gray Cary Ware & Freidenrich represented Rocket Holdings LLC in its acquisition of Resonate Inc., a Sunnyvale-based maker of Web application management software. Lawyers in the Palo Alto office of Wilson Sonsini Goodrich & Rosati represented Resonate. The stock deal is valued at $49.1 million. Resonate’s chief executive, Peter Watkins, and its chief financial officer, Richard Hornstein, own the acquiring company, Rocket Holdings. A company press release said Resonate’s board put together a special, independent committee to look over all acquisition offers before allowing Rocket to proceed. The lead mergers and acquisitions partner on the deal at Gray Cary, Henry Lesser, said he has noticed a slight increase in activity over the past six to eight weeks. But he is cautiously optimistic. “Any pickup in activity looks like a nuclear explosion. But people are starting to find their sea legs in this new environment — new corporate governance rules have been around for the better part of a year now, and people are getting used to it.” Lesser said he would not be surprised to see more acquisitions like this in 2003 because there are a lot of good companies in Silicon Valley for sale. “The companies that are still around now in the tech sector are here because they’ve earned the right to be around.” In addition, Lesser thinks 2003 will see more deals like this one, where a company’s management serves as the buyer. “[There are] a lot of companies with cash on the books and third-party buyers that don’t understand the company’s prospects as well as management.” Gray Cary partner Dennis Sullivan co-led the deal with Lesser. Corporate associates Edward Batts and Benjamin Griebe; co-chair of employee benefits and compensation William Hoffman; and tax partner David Plewa also worked on the deal. Wilson Sonsini partners Aaron Alter and Michael Kennedy led the deal for Resonate. Associates Harold DeGraff, Jason Altieri and Ian Carter also worked on the deal. ITRON v. BENGHIAT A federal jury in Minneapolis recently awarded $7.4 million in damages to Ralph Benghiat, an inventor who took on a large corporation in a patent infringement case. Oppenheimer Wolff & Donnelly intellectual property partner David Bohrer, who took the case on a fee contingency basis, represented Benghiat. “This is a classic case of David beating Goliath,” said Bohrer. “Mr. Benghiat not only proved that his patent was valid, but that the infringement was willful.” Benghiat, 74, spent his career inventing computer systems for the government, including a system that safeguarded nuclear reactors during earthquakes. In 1988 he patented a handheld meter-reading device for use by cities and utility companies, and then wrote letters to companies asking if they were interested in licensing his product. Ten years later, Itron Inc., a Spokane, Wash.-based maker of meter reading devices, offered Benghiat an ultimatum: Take $175,000 for his patent or face a lawsuit. Benghiat decided to take his chances in court. Oppenheimer’s Bohrer thought that not only was it an interesting issue, but that Benghiat had a good case. So good a case, in fact, that Bohrer decided to take it on a contingency fee basis. The case hinged on the means-plus-function rule in patent law — which meant that Bohrer had to convince the jury that Itron’s product completed the same tasks by using the same key technological functions as Benghiat’s patent. Because the jury found Itron had willfully infringed on Benghiat’s patent, the judge can now treble the damages to nearly $25 million and award attorneys fees, estimated to be more than $1 million. In addition, Benghiat can seek an injunction barring Itron from selling its devices until the patent expires in 2005. Now, Bohrer said, his client is willing to return to the settlement table. “We remain open to any type of settlement Itron will explore,” he said. Minneapolis-based attorney Randall Skarr of the law firm Patterson Skarr represented Itron Inc. The case is Itron, Inc. v. Benghiat, 99 cv. 501.

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