RealTime IT News

Infineon, Rambus Lay Lawsuits to Rest

After years of legal wrangling over patents regarding chip making technology, Rambus and Infineon Technologies, have come to terms.

The two companies issued a statement Monday saying they've cleared all outstanding litigation between them. Rambus also agreed to drop its lawsuits against Infineon's former corporate parent Siemens . Under the terms of the deal, Infineon will license Rambus' patent portfolio for current and future Infineon products. The agreement also gives Infineon "most-favored customer" status and an option for acquiring other licenses.

In turn, Infineon gave Rambus a fully paid perpetual license for its memory interfaces.

The exchange will cost Infineon a pretty penny. The German computer memory manufacturer will be cutting Rambus $5.85 million checks for licensing fees every quarter starting November 15, 2005 and continue the payments through November 15, 2007.

After that, the plan is for Infineon to make additional quarterly payments, which could reach a maximum of an additional $100 million. But that will only happen if Rambus can resolve its licensing agreements with certain other unnamed DRAM manufacturers.

The Infineon settlement is one of four currently pending U.S. patent cases involving Rambus. The company sued Hynix Semiconductor, Infineon, Inotera Memories, and Nanya Technology last year after it claimed as many as 18 Rambus patents started showing up in devices on the market.

Rambus has also accused Infineon, Siemens, South Korea's Hynix and Idaho's Micron of price fixing and conspiracy to drive its RDRAM technology out of the market. The $1 billion antitrust case is now in California Superior Court in San Francisco, where Rambus had filed the complaint 10 months ago. The U.S. Department of Justice is also looking into the charges of collusion.

In October 2004, Infineon pled guilty to criminal price fixing, agreeing to pay a $160 million fine to the U.S. Department of Justice and admitting to conspiring with other DRAM companies from 1999 to 2002 to fix DRAM prices and eliminate competition. Four Infineon employees also pled guilty in December, 2004, agreeing to pay fines and serve person sentences.

With Infineon and Siemens settled, Rambus CEO Harold Hughes said he was most interested in finalizing deals with Hynix and Micron.

"This [settlement with Infineon] sets no precedent terms, but it does reduce the risk of delay in the other courts," Hughes said during a conference call with the press. "Those lawsuits will have to be taken on a case by case basis."

Infineon's other big trouble with Rambus harkens back to a five-year-old patent lawsuit where Los Altos, Calif.-Rambus claimed that its German rival copied its SDRAM and DDR DRAM memory designs and began using them without paying licensing fees.

The case was decided in Infineon's favor but had been going through a lengthy appeals process. Earlier this month, a U.S. district judge dismissed Rambus' appeal partially because Infineon successfully argued in court that Rambus destroyed documents pertaining to its corporate patent strategy.

Settling with Hynix and Micron may be a different story. In January, a U.S. district judge ruled Hynix Semiconductor must defend itself from as many as 50 patent infringement claims filed by Rambus.

Because of that, Hynix filed a statement with Korea's Financial Supervisory Service Monday saying it had put aside $346 million in reserve cash to, "settle indemnity claims," and other costs potentially related to a U.S. antitrust probe.

Micron has historically acknowledged that they were under investigation and has maintained they are cooperating with officials.