Though an actual trial date is at least 18 months away, AMD’s lawsuit against rival Intel is picking up steam — and additional participants.
The chipmaker has won a motion to serve document preservation subpoenas against computer makers, retailers, distributors and small system builders as part of its claim that Intel is an abusive monopoly that coerced such companies to use its x86 processors rather than AMD’s. Essentially, the ruling means AMD
can ask the 30 third parties it’s identified for documents it deems relevant to its case against Intel.
While Intel customers such as Dell, Gateway and HP
, fearing reprisals from Intel, may have mixed feelings about cooperating with AMD, the document subpoena power of the ruling gives them legal cover to hand over documents that Intel
might otherwise prefer to never see the light of day.
In its 48-page complaint, AMD made several unsubstantiated claims, such as that Compaq (now part of HP) stopped buying AMD processors because Intel threatened to deny Compaq server chips otherwise. Michael Capellas, Compaq CEO at the time, allegedly told AMD execs that he had to stop buying from AMD because Intel “had a gun to his head.”
AMD already had taken Intel to court late last month with two claims against Intel’s Japanese subsidiary alleging it had violated Japan’s antimonopoly act. Intel’s only public comment to date on AMD’s charges has been a statement by CEO Paul Otellini, who said Intel disagrees “unequivocally” with AMD’s claims. “Intel has always respected the laws of the countries in which we operate. We compete aggressively and fairly to deliver the best value to consumers. This will not change,” he said in a statement.
Whether there is any damaging e-mail or documentation among the files of U.S. computer makers remains to be seen. Following other high-profile cases such as U.S. versus Microsoft where, embarrassing e-came to light, companies are more circumspect in what they say in e-mail.
“I doubt there are any smoking memos,” said analyst Nathan Brookwood of Insight64. “For many years, Intel policy has been to purge e-mails on an annual basis. But every e-mail has a sender and a receiver, so maybe [AMD] will find something among communications to IBM, Dell, HP and others.”
More important, the pretrial discovery process may lead to statements in deposition by key customers supporting AMD’s case.
“It all depends on what discovery turns up,” said Brookwood. “A vendor like HP or IBM doesn’t want to be portrayed as a whipping boy or flunky for Intel. If AMD’s allegations are true that Intel used its market power to coerce people, there is probably some resentment there as well.”
According to David Kroll, AMD director of global communications, no computer maker has told AMD it shouldn’t pursue the case. “In the end, we want to compete on the merits,” said Kroll. “We absolutely know if we don’t deliver on innovation, we will fail. If [the buying decision] was made on price, we would win every time [versus Intel], and pricing will drop more if we’re successful with this case.”