SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

SCHEDULE 13G
(Rule 13d-102)


INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULES 13d-1(b)(c), AND (d) AND AMENDMENTS THERETO FILED
PURSUANT TO RULE 13d-2(b)

(Amendment No. 3)


Network 1 Security Solutions Inc.
(Name of Issuer)
 
 
Common Stock, $.01 Par Value Per Share
(Title of Class of Securities)
 
 
 64121N109
(CUSIP Number)
 
 
December 31, 2011
(Date of Event Which Requires Filing of this Statement)


Check the appropriate box to designate the rule pursuant to which this Schedule is filed:
 
[_]  Rule 13d-1(b)
[x]  Rule 13d-1(c)
[_]  Rule 13d-1(d)

The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
 

 
 

 


CUSIP No.
64121N109
 
 
     
1.
NAME OF REPORTING PERSONS
 
 
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
 
     
 
Hound Partners, LLC
 
     
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a)  [_]
   
(b)  [X]
     
3.
SEC USE ONLY
 
     
     
     
4.
CITIZENSHIP OR PLACE OF ORGANIZATION
 
     
 
Delaware
 
     
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
     
5.
SOLE VOTING POWER
 
     
 
0
 
     
6.
SHARED VOTING POWER
 
     
 
2,587,147
 
     
7.
SOLE DISPOSITIVE POWER
 
     
 
0
 
     
8.
SHARED DISPOSITIVE POWER
 
     
 
2,587,147
 
     
9.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
     
 
2,587,147
 
     
10.
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
[_]
     
11.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
 
     
 
9.79%
 
     
12.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
 
     
 
OO
 
 
 
 

 

CUSIP No.
64121N109
 
 
     
1.
NAME OF REPORTING PERSONS
 
 
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
 
     
 
Hound Performance, LLC
 
     
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a)  [_]
   
(b)  [X]
     
3.
SEC USE ONLY
 
     
     
     
4.
CITIZENSHIP OR PLACE OF ORGANIZATION
 
     
 
Delaware
 
     
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
     
5.
SOLE VOTING POWER
 
     
 
0
 
     
6.
SHARED VOTING POWER
 
     
 
2,339,659
 
     
7.
SOLE DISPOSITIVE POWER
 
     
 
0
 
     
8.
SHARED DISPOSITIVE POWER
 
     
 
2,339,659
 
     
9.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
     
 
2,339,659
 
     
10.
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
[_]
     
11.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
 
     
 
8.85%
 
     
12.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
 
     
 
OO
 
 
 
 

 

CUSIP No.
64121N109
 
 
     
1.
NAME OF REPORTING PERSONS
 
 
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
 
     
 
Jonathan Auerbach
 
     
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a)  [_]
   
(b)  [X]
     
3.
SEC USE ONLY
 
     
     
     
4.
CITIZENSHIP OR PLACE OF ORGANIZATION
 
     
 
United States
 
     
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
     
5.
SOLE VOTING POWER
 
     
 
0
 
     
6.
SHARED VOTING POWER
 
     
 
2,587,147
 
     
7.
SOLE DISPOSITIVE POWER
 
     
 
0
 
     
8.
SHARED DISPOSITIVE POWER
 
     
 
2,587,147
 
     
9.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
     
 
2,587,147
 
     
10.
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
[_]
     
11.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
 
     
 
9.79%
 
     
12.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
 
     
 
IN
 
 
 
 

 

CUSIP No.
64121N109
 
 
     
1.
NAME OF REPORTING PERSONS
 
 
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
 
     
 
Hound Partners Offshore Fund, LP
 
     
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a)  [_]
   
(b)  [X]
     
3.
SEC USE ONLY
 
     
     
     
4.
CITIZENSHIP OR PLACE OF ORGANIZATION
 
     
 
Cayman Islands
 
     
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
     
5.
SOLE VOTING POWER
 
     
 
0
 
     
6.
SHARED VOTING POWER
 
     
 
2,339,659
 
     
7.
SOLE DISPOSITIVE POWER
 
     
 
0
 
     
8.
SHARED DISPOSITIVE POWER
 
     
 
2,339,659
 
     
9.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
     
 
2,339,659
 
     
10.
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
[_]
     
11.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
 
     
 
8.85%
 
     
12.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
 
     
 
PN
 
 
 
 

 
 
CUSIP No.
64121N109
 

Item 1.
(a).
Name of Issuer:
     
   
Network 1 Security Solutions Inc.
     
 
(b).
Address of issuer's principal executive offices:
     
   
445 Park Avenue
Suite 1018
New York, New York 10022
     
Item 2.
(a)-(c).
Name Principal Business Address, and Citizenship of Person Filing:
     
   
Hound Partners, LLC
101 Park Avenue, 48th Floor
New York, NY 10178
     
   
Hound Performance, LLC
101 Park Avenue, 48th Floor
New York, NY 10178
   
Jonathan Auerbach
101 Park Avenue, 48th Floor
New York, NY 10178
     
   
Hound Partners Offshore Fund, LP
c/o Citco Fund Services (Curaçao) N.V.
Kaya Flamboyan 9
P.O. Box 4774
Willemstad, Curaçao
Netherlands Antilles
     
Item 2.
(d)
Title of class of securities:
     
   
Common Stock, $.01 par value per share
     
Item 2.
(e).
CUSIP No.:
     
   
64121N109
     

Item 3.
If This Statement is Filed Pursuant to Rule 13d-1(b), or 13d-2(b) or (c), Check Whether the Person Filing is a:
       
 
(a)
[_]
Broker or dealer registered under Section 15 of the Exchange Act.
       
 
(b)
[_]
Bank as defined in Section 3(a)(6) of the Exchange Act.
       
 
(c)
[_]
Insurance company as defined in Section 3(a)(19) of the Exchange Act.
       
 
(d)
[_]
Investment company registered under Section 8 of the Investment Company Act.
       
 
(e)
[_]
An investment adviser in accordance with Rule 13d-1(b)(1)(ii)(E);
       
 
(f)
[_]
An employee benefit plan or endowment fund in accordance with Rule 13d-1(b)(1)(ii)(F);
       
 
(g)
[_]
A parent holding company or control person in accordance with Rule 13d-1(b)(1)(ii)(G);
       
 
(h)
[_]
A savings association as defined in Section 3(b) of the Federal Deposit Insurance Act;
       
 
(i)
[_]
A church plan that is excluded from the definition of an investment company under Section 3(c)(14) of the Investment Company Act;
       
 
(j)
[_]
Group, in accordance with Rule 13d-1(b)(1)(ii)(J).
 
 
 

 
 
Item 4.
Ownership.
   
 
Provide the following information regarding the aggregate number and percentage of the class of securities of the issuer identified in
Item 1.
       
 
(a)
Amount beneficially owned:
 
       
   
Hound Partners, LLC
2,587,147 shares
   
Hound Performance, LLC
2,339,659 shares
   
Jonathan Auerbach
2,587,147 shares
   
Hound Partners Offshore Fund, LP
2,339,659 shares
       
       
 
(b)
Percent of class:
 
       
   
Hound Partners, LLC
9.79%
   
Hound Performance, LLC
8.85%
   
Jonathan Auerbach
9.79%
   
Hound Partners Offshore Fund, LP
8.85%
       
       
 
(c)
Number of shares as to which such person has:
 
       
   
(i) Sole power to vote or to direct the vote
 
       
   
Hound Partners, LLC
0 shares
   
Hound Performance, LLC
0 shares
   
Jonathan Auerbach
0 shares
   
Hound Partners Offshore Fund, LP
0 shares
        ,
       
   
(ii) Shared power to vote or to direct the vote
 
       
   
Hound Partners, LLC
2,587,147 shares
   
Hound Performance, LLC
2,339,659 shares
   
Jonathan Auerbach
2,587,147 shares
   
Hound Partners Offshore Fund, LP
2,339,659 shares
        ,
       
   
(iii) Sole power to dispose or to direct the disposition of
 
       
   
Hound Partners, LLC
0 shares
   
Hound Performance, LLC
0 shares
   
Jonathan Auerbach
0 shares
   
Hound Partners Offshore Fund, LP
0 shares
        ,
       
   
(iv) Shared power to dispose or to direct the disposition of
 
       
   
Hound Partners, LLC
2,587,147 shares
   
Hound Performance, LLC
2,339,659 shares
   
Jonathan Auerbach
2,587,147 shares
   
Hound Partners Offshore Fund, LP
2,339,659 shares
        ,

Item 5.
Ownership of Five Percent or Less of a Class.
   
 
If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than five percent of the class of securities check the following [_].
   
 
N/A
   
 
 
 

 
 
Item 6.
Ownership of More Than Five Percent on Behalf of Another Person.
   
 
If any other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, such securities, a statement to that effect should be included in response to this item and, if such interest relates to more than five percent of the class, such person should be identified.  A listing of the shareholders of an investment company registered under the Investment Company Act of 1940 or the beneficiaries of employee benefit plan, pension fund or endowment fund is not required.
   
 
N/A
   
Item 7.
Identification and Classification of the Subsidiary Which Acquired the Security Being Reported on by the Parent Holding Company or Control Person.
   
 
If a parent holding company or Control person has filed this schedule, pursuant to Rule 13d-1(b)(1)(ii)(G), so indicate under Item 3(g) and attach an exhibit stating the identity and the Item 3 classification of the relevant subsidiary. If a parent holding company or control person has filed this schedule pursuant to Rule 13d-1(c) or Rule 13d-1(d), attach an exhibit stating the identification of the relevant subsidiary.
   
 
N/A
   
Item 8.
Identification  and  Classification  of Members of the Group.
   
 
If a group has filed this schedule pursuant to §240.13d-1(b)(1)(ii)(J), so indicate under Item 3(j) and attach an exhibit stating the identity and Item 3 classification of each member of the group.  If a group has filed this schedule pursuant to §240.13d-1(c) or §240.13d-1(d), attach an exhibit stating the identity of each member of the group.
   
 
N/A
   
Item 9.
Notice of Dissolution of Group.
   
 
Notice of dissolution of a group may be furnished as an exhibit stating the date of the dissolution and that all further filings with respect to transactions in the security reported on will be filed, if required, by members of the group, in their individual capacity.  See Item 5.
   
 
N/A
   
Item 10.
Certifications.
   
 
By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having such purpose or effect.


 
 

 

SIGNATURE
 

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
 


 
February 6, 2012
 
(Date)
   
   
 
HOUND PARTNERS, LLC (1)
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member
   
 
HOUND PERFORMANCE, LLC (1)
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member
   
 
/s/ Jonathan Auerbach (1)
 
JONATHAN AUERBACH
   
 
HOUND PARTNERS OFFSHORE FUND, LP (1)
   
 
By:  Hound Performance, LLC, its general partner
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member



(1) The Reporting Persons disclaim beneficial ownership except to the extent of their pecuniary interest therein.


 
 

 

EXHIBIT A

AGREEMENT
 


The undersigned agree that this Schedule 13G Amendment number 3 dated February 6, 2012 relating to the Common Stock, $.01 par value per share of Network 1 Security Solutions Inc. shall be filed on behalf of the undersigned.
 

 
HOUND PARTNERS, LLC
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member
   
 
HOUND PERFORMANCE, LLC
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member
   
 
/s/ Jonathan Auerbach
 
JONATHAN AUERBACH
   
 
HOUND PARTNERS OFFSHORE FUND, LP
   
 
By:  Hound Performance, LLC, its general partner
   
 
By:
/s/ Jonathan Auerbach
   
Jonathan Auerbach, Managing Member







SK 22404 0006 1262857