SCIENCE/TECHNOLOGY : Patent Fight Appears Over, to the Relief of 2 Local Companies

At least two Orange County computer companies are sighing with relief with the news that the patent dispute between Motorola Inc. and Japanese electronics giant Hitachi Ltd. was tentatively settled out of court on Monday.

Both Alpha Microsystems in Santa Ana and General Automation Inc. in Anaheim make computers that use Motorola’s 68030 microprocessor, a brain that controls computing functions, which was the subject of the dispute between the two chip makers. The dispute also threatened to cause serious consequences for companies such as Apple Computer Inc. and Sun Microsystems, which depend on a steady supply of 68030 chips for manufacturing their personal computers.

Motorola, based in Schaumburg, Ill., depends on the chip for more than $100 million in annual sales, according to semiconductor industry analysts.

Last week, a federal judge in Austin, Tex., entered an order to enforce an injunction he issued in March temporarily barring both companies from selling the chips involved in the court case in the United States pending a resolution of the dispute. Last Friday, Motorola filed documents in federal court in Washington seeking a permanent stay of the Texas judge’s order.

On Monday, Motorola said it had reached a preliminary settlement agreement with Hitachi. Neither company disclosed details of the tentative agreement.

John S. Cain, president and chief executive of Alpha Microsystems, said his company was concerned about the battle because one its lines of business computers uses the Motorola chip. He noted, however, that his company is not dependent on the chip because several of its other models use other Motorola chips not involved in the Hitachi suit.

General Automation officials expressed far more concern about the Motorola-Hitachi case because their company’s most powerful machines, the 8000 Series of minicomputers, are based on the Motorola chip. Further, the company had also planned to convert the remainder of its business computer line to the 68030 chip in November, said John Howorth, General Automation vice president of marketing.

“It’s a relief to know the dispute is finally concluded,” Howorth said. “But we were confident that the stakes were so high for Motorola that they would do nothing that could interrupt the supply. We were surprised the legal action went as far as it did.”