Rambus Granted Right to Trial

An administrative law judge has denied the Federal Trade Commission’s (FTC) motion for a summary judgment against Rambus. The FTC claimed Rambus forfeited its right to a trial because of the Los Altos, Calif.-based company’s actions in allegedly destroying documents germane to an FTC antitrust action against the semiconductor chip designer.

Judge James Timony agreed that Rambus had destroyed documents or at least failed to have proper procedures in place to preserve documents, but the company’s “utter failure to maintain an inventory of the documents its employees destroyed makes it impossible to discern the exact nature of the relevance of the documents destroyed to the instant matter.”

While ruling Rambus had not forfeited its right to trial, Timony sanctioned the company for its document retention procedures by declaring the burden of proving innocence will shift to Rambus. The trial is now scheduled to begin April 29.

In June of 2002, the FTC charged Rambus with violating federal antitrust laws by deliberately engaging in a pattern of anti-competitive acts and practices that served to deceive an industry-wide standard-setting organization, resulting in alleged adverse effects on competition and consumers. Last December, the FTC further charged Rambus with destroying documents relevant to the case.

The FTC claims Rambus failed to disclose it held patents or pending patents for technologies that were ultimately adopted by the standards group.

If the FTC wins the case, Rambus could be forced to forfeit more than a billion dollars in royalty claims for its chip designs. Rambus doesn’t make or sell chips but collects patent royalties for its designs from chip makers such as Intel. The company’s primary chip designs used to improve the speed of programs used for databases, digital photography and games.

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