Failure rate "exceeds all reasonable industry standards".

The papers lodged with the court in California, in the $50 million action between Cirrus Logic and Fujitsu (of Japan), confirm what observers had already guessed, that – contrary to the blasé denials of any notable problems - there is indeed an officially acknowledged problem with the MPG3xxx series of drives. And Fujitsu knew the massive scale and scope of the problem at least 18 months ago.

Read more: The Register.

I wonder if this will have any impact on the AMD/Fujitsu Flash memory venture.

I hope not. AMD seem to have enough on their plate right now with launched processors not being readily available and them stating that the future of the Hammer depends on Microsofts continued support. I remember reading a while back a post that claimed that some previous happening was "another nail in AMD's coffin". I seriously hope that this messup by Fujitsu doesn't present itself for another nail as AMD already have the hammer (bad pun intended, sorry )