Monday, 27 August 2007

AeroMechanical Competitor Tries To Raise Ruckus

Some concern cropped up after a competitor of AeroMechanical's asked the United States Patent and Trademark Office (USPTO) to "re-examine" AeroMechanical's patents.
AeroMechanical (AMA) released news of the re-examination request made by Toronto-based Star Navigation on August 24th and issued some clarifications on August 27th (click here to read.)
It is important to note that Star's re-examination request is not a claim of patent infringement, a law suit or any action that will affect AeroMechanical's ongoing business.
Reexamination requests can be made by any third party and, as such, the USPTO states many requests are denied.
In any event, AeroMechanical is more than confident all of its patent filings are in order and its patents are valid and in good standing.
Star Navigation claims its technology is everything that AeroMechanical's is and more. However, the market should ask one simple question.
What is Star's confirmed contract base and number of clients and how does that compare to the number of airlines and aircraft signed by AeroMechanical to date?
Interestingly, the venerable and highly respected British aerospace firm, Meggitt, exhaustively reviewed AeroMechanical and its competitors while looking for a firm to partner with in selling breakthrough tracking, diagnostic and communication technology to aircraft manufactures around the world.
Meggit chose AeroMechanical.
It's ironic that AeroMechanical applied for the very patents Star wants re-examined on November 11, 2002, which is the same year Star was founded and listed on the TSX Venture Exchange.
In Star's most recent Management Discussion and Analysis (MD & A) posted on SEDAR, Star states it has a cash balance of $18,246 as at March 31, 2007 and had a working capital deficiency of $3,415,689.
Star's MD & A also shows the company is paying a portion of its office building rent in shares and that "compensation and rent (are) due to directors and persons related to them as well as to employees."
In addition, the MD & A shows Star failed to record any revenue from June 30, 2005 to March 31, 2007. AMA has several million dollars in the bank and had revenues of approximately $1.3 million for the first six months of this year, which is up substantially from 2006.
Investors should also do a little homework and review litigation issues, which currently surround Star.