Company: DMRC
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001437749-25-034816
Chunk: 56

Company: Digimarc CORP
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 56
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2025 (Chadwick v. McCormack et al., No. 3:25-cv-01838-JR), October 14, 2025 (Jensen v. McCormack et al., No. 3:25-cv-01891-SB), and one in the Circuit Court of the State of Oregon for the County of Multnomah on October 23, 2025 (Johnson v. McCormack et al., No. 25-cv-56998), which are based on the same alleged facts and circumstances as the above-referenced securities class action and are against the Company’s Chief Executive Officer, Chief Financial Officer and directors. The derivative actions collectively assert claims pursuant to Sections 10(b), 14(a), and 20(a) of the Exchange Act, as well as for breaches of fiduciary duties, aiding and abetting breaches of fiduciary duties, unjust enrichment, and waste of corporate assets.  Each of the four derivative lawsuits seeks to recover damages on the Company’s behalf and alleges that a legally required pre-suit demand on the Board of Directors would be futile and should be excused.

On November 4, 2025, the Chadwick, Jensen and Franchi actions were consolidated and stayed pending resolution of the Company’s anticipated motion to dismiss in the Ullom Action.

These cases are at an early stage.  The Company believes it has defenses to the claims and is responding accordingly. See Note 17 – Commitments and Contingencies to the consolidated financial statements of this Form 10-Q for information on our legal proceedings. 

Item 1A.      Risk Factors

Our business, financial condition, results of operations and cash flows may be affected by a number of factors. Detailed information about risk factors that may affect Digimarc’s actual results are set forth in Part I, Item 1A: “Risk Factors” of our 2024 Annual Report. The risks and uncertainties described in our 2024 Annual Report are those risks of which we are aware and that we consider to be material to our business. If any of those risks and uncertainties develop into actual events, our business, financial condition, results of operations or cash flows could be materially adversely affected. In that case, the trading price of our common stock could decline. In addition to the other information set forth in this Quarterly Report on Form 10-Q and in Part I, Item 1A: “Risk Factors” of