March 22, 2005
Licensing Settlement Ends Patent Suit by Rambus By THE ASSOCIATED PRESS
http://www.nytimes.com/2005/03/22/technology/22chip.html?pagewanted=print&position=
SAN JOSE, Calif., March 21 (AP) - Ending a long-running patent dispute over computer memory, Rambus and Infineon Technologies settled all of their legal claims against each other on Monday.
Under the deal, Infineon, the German memory chip maker, will pay Rambus a quarterly license fee of $5.85 million, starting Nov. 15 and ending two years later. After that, Infineon could continue to pay up to an accumulated total of $100 million if certain conditions are met.
Rambus, meanwhile, was granted a perpetual license for Infineon's memory interfaces and agreed to treat the company as a "most favored" customer.
Rambus, based in Los Altos, Calif., does not manufacture chips but licenses designs that improve communication between a computer's microprocessor and its memory. The interfaces are critical to avoid data bottlenecks between ever-faster processors and memory chips.
"We are satisfied with these terms. We believe they are in the best interest of our shareholders," said Harold Hughes, Rambus's chief executive.
The settlement comes three weeks after a federal judge in Virginia dismissed Rambus's patent claims. At the time, Rambus said it had a strong case on appeal.
Under the settlement, Infineon will make quarterly payments that will not change even if the number of memory chips incorporating Rambus technology increases, said Christoph Liedtke, an Infineon spokesman.
In 2000, Rambus sued Infineon over royalty payments. Infineon refused to pay and alleged that Rambus participated in an industry standard-setting group from 1991 to 1995 but failed to disclose that it had patents on some technical specifications.
A Virginia jury decided in 2001 that Rambus should pay Infineon $3.5 million in punitive damages, later reduced to $350,000, and the court also awarded Infineon about $7.1 million in litigation costs. A federal appeals court reversed the trial court ruling in early 2003, and Infineon demanded a retrial.
After the settlement was announced Monday, Rambus shares soared $3.91, or nearly 30 percent, to $17.03 on Nasdaq. Infineon shares lost 7 cents, to $9.58, on the New York Stock Exchange.
================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu
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