UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(D) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of
report (Date of earliest event reported): October 29,
2007
ClearOne
Communications, Inc.
(Exact
Name of Registrant as Specified in Its Charter)
Utah
(State
or
Other Jurisdiction of Incorporation)
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000-17219
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87-0398877
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(Commission
File Number)
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(I.R.S.
employer
identification
number)
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5225
Wiley Post Way, Suite 500,
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Salt
Lake City, Utah
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84116
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(Address
of principal executive offices)
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(Zip
Code)
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(801)
975-7200
(Registrant’s
Telephone Number, Including Area Code)
Not
applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
30.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
40.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
8.01 Other Events.
Theft
of Intellectual Property and Copyright Complaints. In January 2007, the
Company filed a lawsuit in the Third Judicial District Court, Salt Lake County,
State of Utah against WideBand Solutions, Inc. and two of its principals, one
former employee named Dr. Jun Yang, and one previously affiliated with the
Company (the “Intellectual Property Case”). ClearOne also brought claims against
Biamp Systems Corporation, Inc. The matter was subsequently removed to federal
court, the United States District Court, District of Utah, Central Division.
The
case is styled ClearOne Communications, Inc. v. Jun Yang, et. al. Civil
No. 2:07-co-37 TC. The Complaint brings claims against different
combinations of the defendants for, among other things, misappropriation of
certain trade secrets, breach of contract, conversion, unjust enrichment and
intentional interference with business and contractual relations. The relief
being sought by the Company includes an order enjoining the defendants from
further use of the Company’s trade secrets and an award consisting of, among
other things, compensation and damages related to the unjust enrichment of
the
defendants. The Court subsequently granted leave to add a third WideBand
principal as a defendant to the case. In August 2007, the Company filed a motion
for a preliminary injunction in the United States District Court, District
of
Utah, seeking to enjoin Wideband Solutions, Inc. from licensing certain
technology the Company believes constitutes its intellectual property and trade
secrets to Harman Music Group, Inc. On October 30, 2007, the Chief
Judge of the United States District Court, the Honorable Tena Campbell, issued
a
Memorandum Decision and Order (the “Injunction Order”). The
Injunction Order “GRANTS ClearOne’s motion for a Preliminary Injunction,” and
orders that “Dr. Yang, as well as his agents, servants, officers, employees,
entities and those acting under his direction and control, are hereby enjoined
from working on or delivering any computer code – either source code or object
code – to Harman until the completion of the trial.” In reaching its
decision, the Court found that Dr. Yang was subject to a valid and enforceable
Confidentiality, Non-Competition, and Invention Assignment Agreement (the
“NDA”), and that ClearOne had demonstrated “a substantial likelihood that
ClearOne will succeed on its claims that Dr. Yang violated the NDA” and derived
the code that WideBand was attempting to license to Harman from code belonging
to ClearOne. The Injunction Order is Docket Entry 572.
On
Monday, October 29, 2007, the Company filed a second action against WideBand
and
the same three principals named as defendants in the Intellectual Property
Case,
this time alleging copyright infringement, vicarious copyright infringement,
and
contributory copyright infringement (the “Copyright Case”). The claims in the
Copyright Case arise out of a copyright issued to the Company for the same
computer code that is the subject of the claims in the Intellectual Property
Case. The relief being sought by the Company includes an order enjoining the
defendants from further use of the Company’s copyrighted material, and an award
consisting of, among other things, compensation and damages related the
copyright infringement. The defendants in the Copyright Case have not yet filed
a response.
This
litigation is subject to all of the risks and uncertainties of litigation and
there can be no assurance as to the probable result of this
litigation.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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CLEARONE
COMMUNICATIONS, INC.
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Date: October
31, 2007
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By:
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/s/
Zeynep Hakimoglu
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Zeynep
Hakimoglu
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Chairman,
President and Chief Executive Officer
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