The earnings release was a positive event but it really does not mater at this stage since the value of the company is primarily tied to the outcome of the appeal.
It is reassuring that BDX has a terrible track record in defending litigation claims. They come accross as arrogant.
I will be a buyer if the stock dips below $3.75. Otherwise, i am going to wait this one out .
The market reaction was expected given the expectation of a last minute settlement. At $4.40 the stock has become a good speculative play since we can assume that sometime within the next year:
1. there still might be a settlement since the "black cloud" will continue to hang over BDX ;
2. BDX's compliance with the injunction will continue to be an issue and Judge Davis still retains jurisdiction over enforcement of the injunction;
3. RVP's product sales may increase as a result of the injunction;
4. RVP may be a candidate for a merger (other then BDX);
5. RVP has applied for additional patents for new products; and
6. regardless of the ultimate outcome of the litigation the stock will rise after the appeal is heard and before the final decision.
If one assumes that we will again see a stock price of at least $5 by the end of the year then we can extrapolate (at a buy at $4.40) a 15% yearly return with little short term risk since the only real negative event would be an adverse final ruling by the 5th Circuit.
I never said it is a "slam dunk". Having practiced as a civil litigator for 35 years and having tried many comlex and protracted cases (jury & non-jury) for a large law firm, I can unequivocally opine that that after reading all of the publicly disseminated pleadings and Orders, that RVP is an odds on favorite to prevail on appeal.
Look at the identity of counsel for each side and you must agree that this was a no holds bar fight where the parties had the best counsel available and cost was no object. RVP purportedly spent $34m in legal fees and i would venture to speculate that BDX spent a lot more. At one point I counted 60 lawyers involved at one stage or another.
Under normal circumstances this case would have settled. Given the long tortured history of acrimony, I doubt that Shaw is willing to make any concessions and BDX is willing to roll the dice that it can beat RVP on some technical arguement that would justify a remand. In a war of attrition BDX has the upper hand but Shaw has proven his mettle.
RVP is trading in the range it should be factoring in the risks of the appeal. Its intrinsic value is probably in the $2.50 range so one can support an additional $100m+/- as the discounted present net market value of the final judgment.
Your posts evidence your legal knowledge and I suspect that you are somehow involved with BDX's legal team who feels that there has been an injustice served on BDX. I have lost a few cases that I should have won and won a few cases that I should lhave lost. As such anything is possible but the bottom line is that a jury's verdict affirmed by the trial Judge after comprehensive post trial motions will rarely be disturbed on appeal.
Google Tom Shaughnessy's Instabog on Seeking Alpha on 3/14/14 in reference to the Apple patent litigation. The 5th Circuit has affirmed Judge Davis 81% of the time and has remanded only 19% of the time. No jury verdict has ever been over turned. Judge Davis' track record is as good as it gets.
I believe that JMichael's position that we can see a 5th Circuit reversal is clearly a "hail Mary". Cut me a break.
not a chance- have you ever seen how crowded the syringe market is? RVP is a just a tiny player
The irony is that RVP is primarily in the business of suing BDX- selling product is just a side line
the impact, regardless of the outcome, is inconsequential since it amounts to only a few million dollars- chump change in the context of this dispute
BDX's attorneys probably have billed BDX on this issue more then the possible exposure. If RVP spent $34m in legal fees on this litigation, BDX has spent $100m.
BDX is financing the Carefusion acquisition with a $9B bridge loan. This should add additional pressure on BDX to resolve the RVP litigation since it may adversely impact the financing arrangements with its lenders.
If LLoyd Miller was so sharp why would he have bought so much RVP? He was entrenched in the stock way before the latest BDX litigation. Without the BDX litigation the stock would be trading at less then $2.
As to the stock price, I believe it is now trading near the level it should be trading under the circumstances. Keep in mind the stock was $2.50 shortly after the verdict in 2013. The present value of the stock takes into account the risks inherent in the appeal process. Although it would appear to be trading at a deep discount, I doubt that it will hit $6 so long as the litigation remains active.
We need a settlement or a buy-out.