You may recall that Blackboard originally won a judgment of $3.3 million from Desire2Learn in their lawsuit. The ruling from the Court of Appeals means that Blackboar will probably have to return that money—plus interest—to Desire2Learn, as Blackboard indicates in an 8-K SEC filing today. The filing says, in part, that Blackboard “expects to record one-time charges of approximately $3.5 million related to the reversal of the district court judgment” of which $3.3 million is the money they have to return and the extra $200K is presumably interest.
Now, here’s the thing. According to Blackboard’s 2008 10-K filing, their net income for that year was $2.8 million. If you subtract the $3.3 million in income that they are going to have to return to D2L from the $2.8 million net profit, it appears that Blackboard’s business actually lost $500K in 2008.