Largest Patent Damages Award of $2.18 Billion against Intel
VLSI took Intel to court over patent infringement of technology related to chip-making. The lawsuit was filed before a Federal jury in Waco, Texas. Federal Jury of Texas court decided recently in favor of VLSI and ordered Intel to pay $2.18 billion. This award is one of the largest patent-damages awards in US history now.
VLSI Technology Inc. is the first company to design and manufacture custom and semi-custom integrated circuits (ICs). The company is based in Silicon Valley has its headquarters at 1109 McKay Drive in San Jose. VLSI Technology defined not only LSI Logic but also the leading edge of the application-specific integrated circuit (ASIC) business. This later resulted in accelerating the push of powerful embedded systems into affordable products.
The company was founded in the year 1979. A trio was responsible for the establishment of this company who was from Fairchild Semiconductor by way of Synertek — Jack Balletto, Dan Floyd, and Gunnar Wetlesen — and by Doug Fairbairn of Xerox PARC and Lambda (later VLSI Design) magazine.
Intel, however, pledged to appeal. Federal Jury of Texas court observed that Intel has infringed two patents that are owned and closely held by VLSI Technology Inc. The jury awarded $1.5 billion for infringement of one patent and $675 million for infringement of the other second patent.
The jury further rejected Intel’s argument where it was denying their act of infringement of either of the patents and was claiming that one of the patents was invalid. The reason stated by it for the invalidity of VLSI’s patent was the coverage of the work by Intel engineers only.
Lawyer William Lee of Wilmer Hale was representing Intel before the jury. “The patents had been owned by Dutch chipmaker NXP Semiconductors, which would get a cut of any damage award”, Intel’s lawyer stated in his closing argument in front of jurors. “VLSI, founded four years ago, has no products and its only potential revenue is this lawsuit. VLSI took two patents off the shelf that hadn’t been used for 10 years and simply said, ‘We’d like $2 billion.’ VLSI is entitled to no more than $2.2 million,” Mr. Lee further added.
On the other side, lawyer Morgan Chu of Irell & Manella was representing VLSI before the jury. He said, “One of the patents was originally issued in the year 2012 to Freescale Semiconductor, and the other in the year 2010 to SigmaTel. Freescale later bought SigmaTel that was in turn bought by NXP in the year 2015. The two patents, in this case, were then transferred to VLSI in the year 2019. The patents covered inventions that increased the power and speed of processors, a key issue for competition.”
However, Intel was not satisfied with the decision of the Federal jury and is planning to appeal further against this ruling. “Intel strongly disagrees with today’s jury verdict,” the company said in a statement. “We intend to appeal and are confident that we will prevail.”
