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Cirrus Logic and ATI Make Amends

Two graphics chipmakers have put aside their differences and settled a patent lawsuit filed earlier this year.

Cirrus Logic and ATI Technologies Wednesday said they have entered into a cross-license agreement and have settled all outstanding litigation between the two companies.

In August of this year, Cirrus settled a similar litigation with ATI's main rival NVIDIA .

In connection with the settlement, Austin, Texas-based Cirrus Logic will transfer a portion of its patent portfolio to ATI relating to the former graphics products group of its PC products division, a business that Cirrus Logic exited several years ago.

ATI said it will pay Cirrus $9 million in October 2003 for its part of the settlement.

In May 2003, Cirrus Logic brought suit against ATI in the United States District Court for the Western District of Texas, Austin Division, for infringement of a Cirrus Logic patent relating to graphics processor technology. In addition, a separate patent infringement suit relating to a different Cirrus Logic patent has been pending in the United States District Court for the Northern District of California, San Francisco Division, since July 1998.

Under the settlement agreement, all outstanding claims and counterclaims in both lawsuits between Cirrus Logic and ATI were dismissed.

However, Markham, Ont.-based ATI is not standing still and recently upped the ante against NVIDIA with the release of its Radeon 9800 XT and Radeon 9600 XT chips for top-end desktop and workstation systems.

The company also said this week it has scored contracts with the developer of video-game Half-Life 2 and Taiwanese motherboard maker Asustek Computer.

ATI shares were also up to USD$15.82 as the company said it expects revenue of $335 million to $365 million for its upcoming fourth quarter and higher adjusted net income compared to the third quarter.

In the third quarter ATI achieved revenues of $342.1 million and adjusted earnings of $17.5 million, or seven cents a share.



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