Bankruptcy auction recovers value from defunct technology company that lost over $20 million in investor capital, delivering results where none were expected
CHICAGO, June 15, 2026 /PRNewswire-³Ô¹ÏºÚÁÏÍø/ -- Ravinia Capital LLC today announced the successful completion of a competitive Section 363 auction sale of the patent portfolio of LVX System, a defunct Li-Fi technology company, on behalf of Chapter 7 Trustee Rick Stermer. The sale closed following a rigorous global marketing effort, a qualified stalking horse bid, and a live auction that produced competing over-bids.
The Challenge: Recovering Value Where None Seemed to Exist
LVX System, founded in 2007 in St. Cloud, Minnesota, spent nearly two decades and over $20 million in investor capital developing Li-Fi wireless technology, a system that transmits data through visible light rather than radio frequency. The company once carried a valuation exceeding $100 million and secured a research and development partnership with NASA. But the commercial market never materialized. By 2024, annual revenue had fallen to $23,270. LVX entered Chapter 7 liquidation with $1,652 in the bank, $5.82 million in liabilities, and approximately 75 Minnesota investors holding equity worth zero.
The estate's sole meaningful asset: a portfolio of 68 granted U.S. patents covering core innovations in Li-Fi and Visible Light Communication. The patents had a book value of $866,000 but no established market, no comparable transactions, and no obvious buyer.
Trustee Turns to Ravinia Capital
Chapter 7 Trustee Rick Stermer needed a team that could create value where the market saw none. Stermer selected Ravinia Capital based on the firm's track record of delivering results in complex bankruptcy asset sales, particularly in situations where traditional approaches had failed or where assets were considered difficult to monetize.
Building Value from the Ground Up
Ravinia assembled a specialized team for what it recognized would be a demanding, unconventional engagement. The firm retained Ocean Tomo, a part of J.S. Held, a leading intellectual property advisory firm, and its experts, David Fraser and Scott Demarest, to conduct a comprehensive patent analysis. The Ocean Tomo, a part of J.S. Held, team developed detailed claim charts substantiating the portfolio's technical strength and commercial relevance, critical work that gave prospective buyers confidence in the assets' enforceability and value.
Ravinia then executed an exhaustive global outreach campaign, contacting over 5,300 prospective buyers, including strategic acquirers, financial sponsors, technology licensees, and IP-focused investors across multiple continents. The team provided extensive technical education to each qualified prospect, translating complex patent claims into clear commercial use cases.
The process produced a qualified stalking horse bid, establishing a credible auction floor. The live auction generated competing over-bids before closing with the winning party.
The Buyer and the Technology's Future
The buyer, Decentranet SPV 16, LLC, plans to deploy the Li-Fi technology in environments where optical data transmission avoids the radio frequency interference that limits conventional Wi-Fi. The portfolio's value reflects Li-Fi's growing relevance in settings where RF spectrum is constrained, regulated, or otherwise unsuitable, including healthcare, defense, industrial automation, and secure communications.
The Power of Section 363
The LVX transaction illustrates the effectiveness of Section 363 of the U.S. Bankruptcy Code as a mechanism for preserving and monetizing intellectual property that might otherwise be lost. The court-supervised process provided buyers with clean title and certainty of execution while maximizing recovery for the estate and its creditors.
Transaction Team Commentary
Tom Goldblatt, Managing Partner, Ravinia Capital:
"This transaction is exactly why we do this work. A company that spent years and millions of dollars developing real technology went under and 75 investors were left holding nothing. Our job was to make sure that the innovation didn't die with the company. These patents represent genuine advances in how the world communicates wirelessly, and now they have an owner with the resources and vision to bring them to market. Section 363 exists for moments like this, to rescue value and give important technology a second life. I'm proud of our team's relentless effort to make that happen."
Rick Stermer, Chapter 7 Trustee, Stermer & Sellner, Chtd.:
"When I took on this case, I knew the patent portfolio was the estate's best chance at meaningful recovery, but selling IP from a defunct company with no revenue and no established buyer market is not a straightforward assignment. Ravinia Capital brought a level of energy and professionalism to this process that exceeded my expectations. They built a competitive auction from scratch, educated the market on the technology, and delivered a result for the estate's creditors. I would not hesitate to work with them again."
Nash Ream, Vice President, Ravinia Capital:
"This was one of the most challenging mandates I've worked on. There was no established market for these assets, no roadmap to follow. We had to build the case for value from scratch, the claim charts, the buyer education, the global outreach. When you contact over 5,300 prospects and work through complex technical diligence with each serious party, that's not a process that runs on autopilot. It takes a team that simply refuses to quit. I'm proud of what the entire Ravinia team accomplished here."
David Fraser, Ocean Tomo, a part of J.S. Held:
"The LVX portfolio represents meaningful innovation in visible light communication. Our analysis confirmed that these patents cover device- and system-level implementations relevant to the IEEE 802.11bb standard without being standard-essential, preserving maximum enforcement flexibility for the buyer. Working with Ravinia on this process was a first-rate experience. Their team understood the technical nuances and translated them into a compelling commercial story for the buyer market."
Transaction Professionals
Investment Banker to the Chapter 7 Trustee: Ravinia Capital LLC (Tom Goldblatt, Managing Partner; Nash Ream, Vice President; Nandhini Ganesan, Director; Jake Hyland, Senior Analyst)
IP Valuation Advisor: Ocean Tomo, a part of J.S. Held (David Fraser, Scott Demarest)
Counsel to the Chapter 7 Trustee: Stermer & Sellner, Chtd. (Rick Stermer; Krystal M. Lynne)
Technical Advisor: Raymond Consulting Services (Daniel Raymond)
About Ravinia Capital LLC
Ravinia Capital is an elite boutique investment bank based in Chicago serving middle-market clients in M&A, distressed situations, and restructuring. The firm's professionals bring decades of experience across economic cycles and a track record of executing complex transactions, including situations where conventional approaches have failed. Ravinia serves business owners, lenders, attorneys, private equity firms, and court-appointed fiduciaries. Managing Partner Tom Goldblatt is a Crain's Chicago Business Notable Dealmaker in M&A and a Turnaround Atlas Award winner.
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Media Contact
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Shari R Giddens, Ravinia Capital LLC, 1 2244227764, [email protected],
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