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'David gets a win vs Goliath': Sonos opens higher after court win vs. Alphabet

Published 30/05/2023, 11:34 pm
Updated 30/05/2023, 11:34 pm

Sonos (NASDAQ:SONO) shares are trading higher on Tuesday after the U.S. court ruled in the company’s favor in the intellectual property dispute with Alphabet (NASDAQ:GOOGL).

The tech giant is told to pay $32.5 million in damages for infringing one of Sonos’ patents, the San Francisco court said on Friday. Sonos was looking for as much as $90M in damages on the two patents.

The U.S. International Trade Commission (ITC) had previously introduced a limited import ban on some Google devices.

The verdict "re-affirms that Google is a serial infringer of our patent portfolio," a Sonos representative told Reuters.

“We believe the win is important as it validates a SONO patent and proves prior infringement by GOOGL,” Jefferies analysts said.

“We believe the courtroom success provides SONO with a key win against a deep-pocketed opponent, which could open the door for SONO to request/obtain licensing deals from smaller competitors that may be infringing on its patents.”

The licensing deal, in this case, could act as a major boost for Sonos’ margins, they added.

The analysts expect Google will appeal against the decision, which should delay the payment.

Sonos shares are up 0.6% on Tuesday.

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