Rambus, Infineon Heading To Appeals Court

The federal lawsuit, in which Infineon won a $3.5 million jury verdict (later reduced to $350,000) in Virginia last year, has been the subject of contentious appeals.

At issue are Rambus patent claims over SDRAM and DDR (double data rate) technology. Infineon and other companies say Rambus attended meetings of the JEDEC standards body in the early 1990s, where the technology was openly discussed, but the company didn't disclose it had or would seek patents on the technology.

Rambus says it did nothing wrong and has sought to charge licensing fees on the technology from other companies, including memory makers such as Infineon and Micron.

A judge in the Infineon lawsuit threw out much of that company's legal victory last year, including its claims surrounding Rambus' SDRAM and DDR standard setting. However, the judge also awarded Infineon $7.1 million in legal fees in the case.

Rambus has appealed the lawsuit to the federal appeals court over its rights to claim future licensing fees on any of the JEDEC-compliant SDRAM and DDR devices, as well as several liability rulings.

"Briefing [to the appeals court on all of the issues that have been appealed has been coordinated by the [appeals court using a shortened schedule and a hearing on both of [Rambus' appeals is expected in the summer of 2002," Rambus wrote in its most recent 10Q filing with the U.S. Securities and Exchange Commission.

In addition to the Infineon case, Micron has sued Rambus in U.S. District Court in Delaware, on essentially the same grounds as Infineon. That case could go to trial next quarter if it is not resolved out of court by then, Rambus said in the SEC filing.

All the litigation has come with a price tag for Rambus. In its annual report with the SEC, the company reported that its litigation costs last year were $27.1 million, compared with $3.8 million a year earlier. Rambus said trial delays in some of its cases led to some of that increase.

Some memory providers in the channel say they've been spending more of their time focusing on day-to-day pricing issues in the commodity space instead of on the drawn-out legal skirmishes.

"Other than the price of Rambus [memory being high, the market is in a major correction right now," said David Harvey, founder of the Shenandoah Memory, a Churchville, Va.-based memory provider. "It's not going to be long before they are all going to be competitive price-wise. I'm sure if [Rambus wins, it will affect the market, but I'm really not sure how."