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Commitments and Contingencies
 6 Months Ended
Jun. 30, 2012
Commitments and Contingencies [Abstract]  
COMMITMENTS AND CONTINGENCIES
6. COMMITMENTS AND CONTINGENCIES

Legal Matters

On March 29, 2012, United Services Automobile Association (“USAA”) filed a complaint in the U.S. District Court for the Western District of Texas San Antonio Division against the Company seeking, among other things, a declaratory judgment that USAA does not infringe certain patents of the Company relating to Mobile Deposit and that such patents are not enforceable against USAA. In addition, USAA alleges that it disclosed confidential information to the Company and that the Company used such information in a patent application. USAA seeks damages and injunctive relief. The Company has moved to dismiss USAA’s complaint.

On April 12, 2012, the Company filed a lawsuit against USAA in the U.S. District Court for the District of Delaware. The Company alleges that USAA infringes five of the Company’s patents relating to image capture on mobile devices, that USAA breached the parties’ license agreement by using the Company’s products beyond the scope of the agreed-upon license terms and that USAA breached the parties’ license agreement by disclosing confidential pricing and other confidential information for a Company legacy product installation in the lawsuit USAA filed in Texas.

On July 19, 2012, the Company filed a motion to amend its complaint against USAA to include the claims of defamation and violation of the Lanham Act for unfair business practices in its lawsuit in the U.S. District Court for the District of Delaware.

The Company believes that USAA’s claims are without merit and intends to vigorously defend against these claims and pursue its claims against USAA. Management of the Company does not believe that USAA’s claims or any other legal proceedings or claims will have, individually or in the aggregate, a material adverse effect on the Company’s business, financial condition, operating results, cash flows or liquidity.

Facility Lease

The Company’s principal executive offices, as well as its research and development facility, are located in an office building in San Diego, California that the Company leases under a non-cancelable operating lease. The lease costs are expensed on a straight-line basis over the lease term. The term of the lease on this facility commenced in December 2005 and expires in December 2012.

In February 2009, the lease was amended to allow the Company to defer the payment of 50% of the basic rent due for the months of February through September 2009. The Company repaid the deferred rent with interest at an annual rate of 6% in equal monthly installments between October 2009 and March 2010. In addition, in connection with the February 2009 amendment, the Company waived its right to exercise an early termination option.

In September 2009, the lease was further amended to reduce the amount of office space subject to the lease by 1,722 square feet from 15,927 square feet to 14,205 square feet, which reduced the Company’s basic rent proportionately starting in December 2009.

In February 2012, the lease was further amended to increase the amount of office space subject to the lease by 9,807 square feet to 24,012 square feet, which increased the Company’s basic rent proportionately starting in April 2012.

Subsequent to the end of the quarter, the lease was further amended on July 3, 2012 to decrease the rentable square footage from approximately 24,012 square feet to approximately 22,523 square feet and extend the term of the existing lease through June 30, 2019. The annual base rent under the lease amendment, which commences on January 1, 2013, is approximately $471,000 per year and is subject to annual increases of approximately three percent per year. In connection with the lease amendment, the Company issued a standby letter of credit to the landlord that allows for one or more draws of up to $210,000 over the term of the lease extension.

Capital Lease

In October 2011, the Company purchased equipment under a capital lease totaling $95,388. At June 30, 2012, assets held under capital leases had a net book value of $82,670, net of accumulated amortization of $12,718. The Company did not purchase equipment under capital leases during the nine months ended June 30, 2011.