Suit Says Western Digital Violated Graphics Patents
Cadtrak Corp., a small computer graphics licenser in San Mateo, said Thursday that it has filed a lawsuit against Western Digital Corp. for allegedly infringing on two of its patents.
The suit alleges that Western Digital and a subsidiary, Western Digital Imaging in Brisbane, Calif., infringed on two Cadtrak patents that cover several fundamental functions in most computer graphics devices.
Western Digital said in a statement that Cadtrak’s claim lacks merit and that it will file a countersuit asking for treble damages. Western Digital said its imaging subsidiary holds a valid license for the Cadtrak technology that covers its product lines.
Bill Emmerich, president of Cadtrak, said his company has attempted to negotiate a solution to the patent issue with Western Digital since August, 1989.
“We’re filing this out of frustration,” Emmerich said.
Cadtrak’s suit, filed in U.S. District Court in San Francisco, did not specify damages.
Western Digital, an Irvine-based manufacturer of personal computer components, entered the computer graphics business by acquiring Paradise Systems in 1986 and Verticom Inc. in 1988.
Robert Blair, a spokesman for Western Digital, said both Verticom and Paradise obtained licenses from Cadtrak before the companies were purchased by Western Digital. He said Western Digital believes the licenses are legally transferable.
Emmerich said Cadtrak’s two patents for graphics devices, issued originally in 1978, cover basic functions of graphics products based on the EGA, VGA and Hercules industry standards.
More than 250 computer companies--including International Business Machines Corp., Apple Computer Inc., Texas Instruments Inc. and Hewlett-Packard Co.-- have agreed to pay royalties for the right to incorporate Cadtrak’s patented features in their product designs, Emmerich said. The royalties usually amount to 2% of revenue.
Cadtrak said it plans to notify Western Digital’s customers that graphic boards and graphic controller chips that the Irvine firm supplies are not licensed. Cadtrak said it will seek to enforce its license with Western Digital customers, but Western Digital said it believes that its customers are legally protected.
Edmund C. Spelman, an analyst with Oppenheimer & Co. in New York, said he does not expect the Cadtrak suit to affect Western Digital’s earnings. Western Digital’s video graphics business accounted for 25% of the company’s annual $992 million in revenue in the fiscal year ended June 30, 1989.
Cadtrak was founded to market a high-end engineering workstation, but the product was pulled from the market in 1986 and the company has since focused solely on licensing its patents.
Emmerich said the company has one other pending lawsuit--against Commodore International’s Commodore Business Machines computer subsidiary. Commodore has filed a countersuit seeking to declare the patents invalid.
