In brief: Intel has won the second patent trial against VLSI, dodging a massive $3 billion blow to its finances. Intel proved it didn't employ either of the two NXP semiconductors patented technologies VLSI accused it of using to develop its processors.
In Intel's first legal battle with VLSI Technology LLC, a Waco, Texas jury ruled that Intel should pay a total of $2.2 billion for infringement of two patents. That decision is awaiting appeal.
In this second separate lawsuit, VLSI claimed damages of $3 billion, alleging that the chipmaker infringed on two other patents it purchased from NXP Semiconductors NV. The patents pertain to technologies used in MP3 players from two decades ago. One of the patents expired last November and the other is set to expire next month. Bloomberg notes that because of the alleged damage caused by Intel's use of the technologies, VLSI claimed it was owed $3 billion.
According to Intel's lawyers, that's about 3,000 times more than the patent's value at the time of past acquisitions. Intel defended itself, stating that its engineering teams have been developing processors for all kinds of devices for decades. Furthermore, the patents in question didn't even cover new concepts when they were issued 20 years ago.
Intel is pleased to know that the jury "rejected VLSI's meritless claims that Intel's cutting-edge processors infringe expired patents on MP3 player technology."
Despite being a semiconductor manufacturer, VLSI does not have other sources of revenue besides the lawsuits against Intel. The company is owned by Fortress Investment Group, which Intel and Apple sued for deploying "patents in waves of lawsuits against their targets without regard for the merits of the claims." The court dismissed the case, but Apple and Intel amended it one week after VLSI won the first trial against Intel.
The third "wave" of the lawsuits is scheduled for a hearing in the same Waco federal court next month.
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