Facebook 2014 Annual Report Download - page 79

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The following is a schedule, by years, of the future minimum lease payments required under non-
cancelable capital and operating leases as of
December 31, 2014 (in millions):
Operating lease expenses totaled $125 million , $130 million , and $196 million for the years ended December 31, 2014 , 2013 and 2012
,
respectively.
Other contractual commitments
We also have $1.03 billion of non-cancelable contractual commitments as of December 31, 2014
, primarily related to network infrastructure for
our data center operations and, to a lesser extent, construction of our data center sites. The majority of these commitments are due within five years .
Contingencies
Legal Matters
Beginning on May 22, 2012, multiple putative class actions, derivative actions, and individual actions were filed in state and federal courts in the
United States and in other jurisdictions against us, our directors, and/or certain of our officers alleging violation of securities laws or breach of fiduciary
duties in connection with our initial public offering (IPO) and seeking unspecified damages. We believe these lawsuits are without merit, and we intend
to continue to vigorously defend them. The vast majority of the cases in the United States, along with multiple cases filed against The NASDAQ OMX
Group, Inc. and The Nasdaq Stock Market LLC (collectively referred to herein as NASDAQ) alleging technical and other trading-
related errors by
NASDAQ in connection with our IPO, were ordered centralized for coordinated or consolidated pre
-
trial proceedings in the U.S. District Court for the
Southern District of New York. In a series of rulings in 2013 and 2014, the court denied our motion to dismiss the consolidated securities class action
and granted our motions to dismiss the derivative actions against our directors and certain of our officers. The plaintiffs in four of these derivative
actions have filed notices of appeal. On December 23, 2014, the plaintiffs in the consolidated securities class action filed their motion for class
certification. In addition, the events surrounding our IPO became the subject of various state and federal government inquiries. In May 2014, the
Securities and Exchange Commission (SEC) notified us that it had terminated its inquiry and that no enforcement action had been recommended by the
SEC.
We are also party to various legal proceedings and claims that arise in the ordinary course of business. With respect to our outstanding legal
matters, we believe that the amount or estimable range of reasonably possible loss will not, either individually or in the aggregate, have a material
adverse effect on our business, consolidated financial position, results of operations, or cash flows. However, the outcome of litigation is inherently
uncertain. Therefore, if one or more of these legal matters were resolved against us for amounts in excess of management's expectations, our results of
operations and financial condition, including in a particular reporting period, could be materially adversely affected.
Indemnifications
In the normal course of business, to facilitate transactions of services and products, we have agreed to indemnify certain parties with respect to
certain matters. We have agreed to hold certain parties harmless against losses arising from a breach of representations or covenants, or out of
intellectual property infringement or other claims made by third parties. These agreements may limit the time within which an indemnification claim can
be made and the amount of the claim. In addition, we have entered into indemnification agreements with our officers, directors, and certain employees,
and our certificate of incorporation and bylaws contain similar indemnification obligations.
75
Capital
Leases
Operating
Leases
2015
$
124
$
155
2016
20
161
2017
15
158
2018
16
143
2019
16
125
Thereafter
112
359
Total minimum lease payments
$
303
$
1,101
Less: amount representing interest and taxes
(70
)
Less: current portion of the present value of minimum lease payments
(114
)
Capital lease obligations, net of current portion
$
119