updated 23 FEB 2023, 10:39 am PST
EdisonReport reached out to Signify for a comment late Wednesday and we received the following statement:
“Signify has no interest in acquiring Deco Lighting, its products, its designs or its intellectual property assets. Signify merely wants Deco to pay the royalties it owes under its EnabLED patent license agreement and the confirmed bankruptcy payment plan.”
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Sam Sinai, co-founder of Deco Lighting, called me today regarding Deco’s bankruptcy. Sam was very adamant. His comments were filled with passion, some anger, and much profanity. Rather than investigating his every statement and giving you my analysis (or bias), I have listed highlights from the discussion. I leave it for the readers to draw their own conclusions.
The content is accurate, but the language has been cleaned up.
Q: What is going on with the bankruptcy?
A: We have survived the worst of it, and we are paying our current reps and other vendors on time like clockwork.
Q: Deco is paying the reps or PQL is paying the reps?
A: Everything is going through PQL, as they have taken over the financial responsibilities, and we will continue to grow together.
Q: What is going with Signify and the bankruptcy?
A: We will see them in court. They are bullies. It’s not like we bought $300,000 worth of material and then didn’t pay for the material. It has to do with what they say we owe them for patent infringement.
Q: I didn’t think it was that much?
A: It’s $200,000 or $300,000, I don’t remember the exact number.
Q: But you did agree to pay them at one point, right?
A: We agreed to a number, a much smaller number for licensing. We have been paying it, and we continue to pay it. But, then they came at us with all these damages. I think the original number with damages was $500K, and we negotiated it down to $200K or $300K. Again, I don’t remember the exact number, and I don’t think we should pay it.
Q: Can you pay it if you wanted to?
A: Yes, Andy (Andy Sreden, PQL Founder) has the money, and we could write a check for it, but we are throwing money away. I pay the reps, and they keep selling. I pay the suppliers, and they keep shipping products to me. If I pay Signify, I get nothing. It’s like they expect us to pay them $35,000 per month and we haven’t paid for 7 months. So, they want to try to convert the bankruptcy from Chapter 11 to Chapter 7 to force us to pay. They are bullies. What they really want is the company. They want to own Deco. PQL has been financially responsible for everything so far, and they would never let our company go into chapter 7 bankruptcy.
Q: Why would Signify want the company?
A: Are you kidding? We have patents! We have strong patents that they want in their portfolio, and they want our designs.
Q: Specifically which patents?
(During the interview he emailed a copy of Patent US 9,386,659 B2 dated 5 JUL 2016. The patent description states: Fully Integrated Lighting Intelligent Module.)
A: This is the Wireless DecoMesh technology, and Signify wants it for their portfolio. We filed for this patent long before anyone else. I hired three attorneys to research and file this patent.
Q: Why don’t you enforce the patent and collect the royalties yourself?
A: I don’t have the money to start enforcing it now. Also, the technology is not yet in high demand, but it will be because all the driver manufacturers want this technology. This is why Signify wants it so badly.
Q: You mentioned designs. Do you have fixture designs that Signify wants but can’t develop?
A: There is value in our architectural designs, and Signify thinks they can get this for pennies on the dollar. We compete well against Focal Point, and, now that Legrand purchased Focal Point, Signify needs our designs to compete. They want to own Deco. That is why they’re pushing this Chapter 7 thing.
Q: Given the bankruptcy and the tarnished image of DECO, do you think they want the brand or just the patents and the designs?
A: I don’t know what they really want, but we share some of the same reps, and we just took a $200K order from them, so they want us. There is value in the patents and architectural designs. Would they keep the brand, would they keep me? I don’t know. Probably not. So, what do I get out of it? Nothing! If you pay Signify, it doesn’t bring anything to you, it’s like throwing money in a fire. We will see them in court.
We reached out to Signify and will update this report if they have a comment.