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Spansion Sues Macronix Over Trademark

Flash memory maker Spansion is seeking over $100 million in damages in a trademark infringement lawsuit against Macronix International and Macronix America.

The Flash memory spinoff from AMD and Fujitsu said Macronix deliberately made false statements about being fully compatible with Spansion's MirrorBit Flash memory products to piggyback on its brand.

The company is asking a California court to make Macronix cease its false statements; forfeit its ill-gotten gains; and pay over $100 million to Spansion for the improper use of the MirrorBit brand to market Macronix Flash memory products.

Spansion alleges that Macronix has made millions by tricking customers into believing it is an authorized second source for Spansion MirrorBit and that the Taiwan-based company is purposely and falsely marketing its Flash memory devices as compatible with MirrorBit products.

Macronix did not respond to requests for comment. But on its Web site, Macronix refers to its NBit Flash cards as "MirrorBit compatible."

"Spansion has invested hundreds of millions of dollars over eight years to develop MirrorBit products, and has established the MirrorBit brand as a high-quality, highly reliable Flash memory technology," said Robert Melendres, executive vice president and general counsel for Spansion.

"By making false statements about Spansion's MirrorBit brand, and illegally using Spansion's valuable trademark to market its products, Macronix has diluted our brand and caused confusion in the market place."

Flash memory is coveted by many makers of handheld gadgets, such as MP3 players and digital cameras, because the data is retained even when the power is cut off. Analysts expect the Flash memory segment to continue to be a multi-billion-dollar market.

Spansion's MirrorBit portfolio includes traditional NOR technology cards and chip packages, as well as ORNAND, a hybrid Flash device that boasts a NAND interface with the fast read performance of NOR Flash memory.

Similarly, Macronix makes NOR Flash chips and cards for computing, communications and consumer markets.

Spansion's move versus Macronix is the second major Flash-related lawsuit. Lexar is suing Toshiba for breach of trade secrets and patent infringement.

Micron agreed to acquire Lexar today for $688 million.