Patent Law

Hedgerow

By Gary Odom and Jordan Kuhn

Hedge fund Riley Investment Management has gotten uppity about Transmeta giving a $10 million bonus to John O'Hara Horsley, Transmeta general counsel. Calling the bonus "outrageous, illegal and unconscionable," Riley filed a lawsuit accusing Horsely, Transmeta executives, and board members, of gross mismanagement, breach of fiduciary duty, waste of corporate assets, and abuse of control. When asked, Riley demurred on saying how it really felt.

Riley holds about 7% of Transmeta stock.

Struggling Transmeta wrestled a $250 million patent settlement from Intel late last year. The fillip tripled the stock price.

Horsley's bonus was reportedly structured like a contingency fee, an unusual way to compensate in-house counsel. Horsley had been paid around $400,000 a year before striking the bonus deal upon suing Intel.

Horsley joined Transmeta in 2000 from the Federal Trade Commission, where he was chief counsel for IP and technology matters. He helped take Transmeta public that year.

Full post as published by The Patent Prospector on March 19, 2008 (boomark / email).