Texas Instruments Settles Suit With Japanese Company : Toshiba Agrees to Pay Fees, Enter Cross-Licensing Pact

Texas Instruments said on Friday that it has settled with yet another of the Japanese semiconductor makers it sued in a wide-ranging patent infringement case.

The Dallas-based company, one of the pioneers in computer chip design, said it has dropped charges against Toshiba, in exchange for a cross-licensing and fee-payment arrangement.

Last month, TI settled similar charges against Sharp and Fujitsu, two other Japanese chip makers that it claimed had continued to make patented TI semiconductor products after license agreements had lapsed. Still named in the suit are five other Japanese chip companies: NEC, Oki, Matshushita, Mitsubishi and Hitachi, as well as Samsung, a Korean chip-maker.

‘Significant’ Royalties

As in the settlements with Sharp and Fujitsu, the Toshiba agreement includes cross-licensing of the two companies’ semiconductor patents. In addition, Toshiba will make fixed royalty payments, which TI described only as “significant,” along with per-chip royalty payments on TI-patented products.

Such royalty payments, especially the per-chip fees, represent a significant advance in the U.S. chip industry’s attempts to recoup some of its losses to Asian firms, which learned through licensing deals to make chips and then captured a huge market share by proceeding to make them better and sell them cheaper than the pioneering U.S. firms.

The Toshiba agreement, which must be reviewed by the Japanese government, would expire in 1991. Already, an administrative law judge for the U.S. International Trade Commission has agreed to drop Toshiba from the ITC patent infringement investigations begun at TI’s behest. The ITC has 30 days to review the decision, but already has upheld a similar decision relating to the settlement with Sharp and Fujitsu.