Pull Chip Off Market, Motorola Ordered

A federal judge today ordered Motorola Inc. to pull a key computer chip off the market, dealing a setback to the company in a legal battle over trade secrets with former partner Hitachi Ltd.

The order will also prevent Hitachi from selling its own microprocessor in the United States.

Motorola said it will immediately appeal the decision by U.S. District Judge Lucius D. Bunton of Midland. Bunton’s order was released in Austin, where Motorola’s MC68030 microprocessor is made.

A microprocessor is a computer chip that handles the processing functions in a computer.

In a statement from its Schaumburg, Ill., headquarters, Motorola said it expects a patent appeals court to stay Bunton’s order. The company said it is confident that it will continue to provide an uninterrupted supply of its market-leading microprocessor to customers.

Bunton banned the sale of the chips March 29 and fined both companies, saying they violated each other’s patents.

But he stayed the order a day later after Motorola argued that the chip ban could devastate outside computer makers that depend on Motorola microprocessors to run their machines.

Today’s order lifts the stay. The judge said the companies have been given enough time to settle on their own.

“The parties have chosen not to forge a settlement in the interim, and this court is not inclined to continue its indulgence,” Bunton said.

Motorola contends that Bunton’s order gives Hitachi unequal bargaining power in any settlement negotiations because, as Bunton said in his order, Motorola’s processor is more “commercially viable” than Hitachi’s.

Hitachi said it needed the injunction because Motorola could continue to design around the MC68030, which would eliminate any incentive for Motorola to settle the patent infringement dispute.