“By open sourcing our DisplayLink technology for whatever personal reasons you may have as a ‘hobbyist,’ you will be single-handedly eviscerating DisplayLink's competitive advantage in this crowded market by educating our competitors and other third parties as to how we implement our proprietary technology, which we have gone to great lengths and great expense to prevent.”

This is a tacit admission that what's being disclosed isn't protected by their patents. The only things a patent provides exclusive rights for are disclosed claimed inventions.

Their claim suggests that at least some of their competitive advantage comes from unpatented implementation details. They won't have a trade secret claim unless the information was obtained through some improper means, and reverse engineering isn't one of those.

If he's not violating copyright, these guys just don't have a leg to stand on, and they're banging the table trying to maintain a moat that no longer exists.

DisplayLink on the driver side just compresses frames to send them over USB.

It would be interesting to analyse if Synaptics haven't stolen code from open source ffmpeg to do the compression.