DigiCash Update, part II

[Greg Broiles]

I've been away for a bit, physically and otherwise, but have am back from
vacation and spent some time down at the clerk's office of the bankruptcy
court in San Jose today. Apropos to an ongoing discussion of a week or so ago -

At 07:20 PM 12/16/98 -0500, Robert Hettinga wrote:
[...]
>Of course, we'll find out the real answers to all of this when the Chapter 11
>filing is actually final. Right now, I hear that there's nothing there but
>a placeholder filing, with no actual assets listed in detail, much less
>whether they're secured by anything.

The filing is real - the court's file is up to about 400 pages, so I didn't
get the whole thing, but the schedules (including a list of assets) have
been filed. I'm in the process of digesting them into a website about the
Digicash bankruptcy. A little birdie sent me a document which is
purportedly the Dutch bankruptcy filing, and I'm looking for a translator.
Volunteers? 

According to the documents filed with the court, Digicash Inc. has assets
of $51,649, and liabilities of $3,068,076.49. The breakdown is as follows:

Real estate				$0
Personal property			$51,649
Secured claims			($123,438.09)
Unsecured priority claims	($279,500.60)
Unsecured nonpriority claims	($2,665,137.80)

Personal property includes $5,595.00 in cash, $23,220 in advance payments
on leases or security deposits, $5,750 in accounts receivable, and $17,084
in office supplies, furniture, and equipment.

Secured claims includes $73,449.56 for/secured by computer equipment,
$12,362 for/secured by a copier, and $37,626.53 for/secured by office
furniture, fittings, etc. 

Unsecured priority claims are for wages & commissions owed to employees and
independent sales agents, for amounts earned in the 90 days prior to
bankruptcy, maxing out at $4300 per person entitled to priority.

Unsecured nonpriority claims are everything else - including a bridge loan
from August Capital for $825,941.00, a bridge loan from the Glide IT Fund
for $386,325.18, legal fees of $103,756 to Gunderson Dettmer, $53,143.25 to
Netscape (apparently a software license, marked as disputed), a bridge loan
from Nicholas Negroponte for $193,735.20, legal fees of $25,103.29 to Nixon
& Vanderhyde of Washington DC (patent attorneys, who were kind enough to
file detailed legal bills with their proof of claim), a bridge loan from
Paul Van Keep of $61,698.36, legal fees of $20,635.59 to Steinhauser
Hoogenraad of the Netherlands, a bridge loan of $581,339.77 from Tech. For
Information and Entertainment III LP of Lexington MA, and a bridge loan of
$7242.35 from Thomas Little of Nashua NH. (there are also a fair number of
small to medium trade debts which I haven't listed here.) 

The IP listed as assets (but not assigned a value in the amounts shown
above) include these patents:

(all are US patents)

5,712,913	Limited-traceability systems
5,781,631	Limited-traceability systems
5,493,614	Private signature and proof systems
5,485,520	Automatic real-time highway toll collection from moving vehicles
[listed twice]
5,434,919	Compact endorsement signature systems
5,373,558	Desinated[sic]-confirmer signature systems
5,276,736	Optionally moderated transaction systems
5,131,039	Optionally moderated transaction systems
4,996,711	Selected-exponent signature systems
4,991,210	Unpredictable blind signature systems
4,987,593	One-show blind signature systems
4,949,380	Returned-value blind signature systems
4,947,430	Undeniable signature systems
4,926,480	Card-computer moderated systems
4,914,698	One-show blind signature systems
4,759,064	Blind unanticipated signature systems
4,759,063	Blind signature systems
4,529,870	Cryptographic identification, financial transaction, and
credential device

The IP list also mentions that DigiCash holds copyrights to software in the
US and abroad, without providing further detail.

Digicash holds or has filed for trademarks on the terms "DIGICASH" and
"ECASH" in the following jurisdictions: Australia, Brazil, Canada,
Switzerland, Chile, China, Costa Rica, Germany, European Community,
Finland, Israel, India, Iceland, Japan, South Korea, Mexico, Malaysia,
Norway, New Zealand, Phillipines, Singapore, Thailand, and the United
States. They have also filed for (not all are approved or registered) the
following trademarks in the US: CRYPTOPAY, CYBER DOLLAR, CYBER PAY, CYBER$,
CYBER-BUCKS, CYBER-CASH, CYBERCHEQUE, CYBERMILES, DATACOIN, DIGI$,
DIGI-CASH, DIGI-DOLLAR, DIGIBANK, DIGICASH, DIGICOIN, DIGIPAY, E$, E-CASH,
E-COIN, E-DOLLAR, E-MONEY, E-PAY, E-VOTE, ECREDIT, EGIRO, EMILES, EWIRE,
EYECASH/ICASH, FIRST DIGITAL BANK, KIDCASH, MONEY MAN, MONEY MEDIA,
NET-CASH, NET-PAY, PAY-AS-YOU-GO, TELEPAY, V-BANK, V-CASH, V-COIN, V-MONEY,
V-PAY, V-SHOP, VIRTUAL CASH, VIRTUAL COIN.

There's no discussion of foreign patents, which seems peculiar - the legal
bills from the patent attorneys included amounts for foreign associates,
with legal bills for Japanese patent matters sticking out in particular. 

As far as I can tell, Digicash Inc. (the US corp) was formed in 1990; the
Netherlands and Australian corps are/were subsidiaries of the US corp.

The filing discloses the following historical financial data -

Year		Sales
1998		$134,842
1997		$ 10,000

Year		Income
1998		$23,161 interest
1998		$ 2,580 sale of assets 
1997		$53,464 interest

The other item which may be of interest is that the IP portfolio has been
pledged as collateral for a post-filing bridge loan obtained from most of
the funders who are owed the $2M unsecured; I was hoping to trade files
with someone else (whom I haven't been able to meet with yet) so I didn't
get a copy of that filing, but I seem to remember that the postfiling
bridge loan, approved by the court, was for $330K, which will be paid back
from the proceeds of the sale of DigiCash's assets.

I'm hoping to work all of this up into a more comprehensive presentation,
but that's going to take another week or two at least.  
--
Greg Broiles
gbroiles at netbox.com
PGP: 0x26E4488C