A Dogged Inventor Makes the Computer Industry Say: Hello, Mr. Chip : Technology: In 1968 Gilbert Hyatt apparently invented the computer on a chip. Armed with a patent at last, he aims for royalties--and recognition.

In 1968, much of the world was in turmoil. Thousands died in the Tet offensive in Vietnam. Russian tanks rumbled into Czechoslovakia. Robert F. Kennedy and Martin Luther King Jr. fell to assassins’ bullets. Police clashed with demonstrators in Chicago.

But Gilbert P. Hyatt distanced himself from the turbulence. The 30-year-old electrical engineer was absorbed with another matter: Designing a computer to fit on a silicon microchip no bigger than a fingernail.

Risking his family’s savings and security, Hyatt quit his well-paying job as a research scientist at Teledyne Inc. and retreated to his Northridge home. In the family room, alone, seven days a week, he tinkered with homemade electronics hardware.

An idea emerged. And though the design was never specifically used to produce a chip that powered an electronic gadget, Hyatt is now asking the world to recognize him two decades later as the inventor who made the computer revolution possible.

In July, after a 20-year legal fight that generated an estimated 10,000 pages of paperwork, the U.S. Patent and Trademark Office gave Hyatt patent No. 4,942,516 for a “Single Chip Integrated Circuit Computer Architecture.” The patent shocked the electronics world.

If it withstands legal challenges, it could establish Hyatt as the father of the “computer on a chip,” or microprocessor, the technology that spawned modern wonders of electronics from pocket calculators to microwave ovens. It could also earn him millions of dollars a year in royalties.

“I didn’t invent the computer, but I came up with a very good improvement,” said Hyatt, a 52-year-old workaholic who prefers to work alone at a modest home in a cul-de-sac in La Palma. “My work in those days led to the PCs of today.”

Depending on the viewpoint, Hyatt is either an underdog who battled greedy investors to keep control of his technology, or a frustrated scientist who couldn’t bring his ideas to fruition in the marketplace and so exploited the patent system instead.

Among those who begrudge Hyatt a place in history are former Intel Corp. researchers Marcian E. (Ted) Hoff and Federico Faggin, who along with engineer Stan Mazor are credited with inventing the first commercial microprocessor between 1969 and 1971.

Another inventor, Gary W. Boone, an ex-Texas Instruments engineer, also has been given recognition because he was awarded the first microprocessor patent in 1973--three years after Hyatt filed for his patent.

But Hyatt contends that he is the true inventor of the microprocessor and the technology “leaked out” to the industry through investors. He also says that patents awarded to Intel and TI cover only limited microprocessor improvements that were product specific.

“The patent office did a very thorough job before they issued the patent,” he said. “That is why it took 20 years.”

The competitive atmosphere in the microelectronics industry in the 1960s was similar to the race between the United States and the Soviet Union to send a manned spacecraft to the moon. Electronics companies were going all out to build chips with consumer uses.

The semiconductor chip had been invented a decade earlier by engineers Jack S. Kilby at TI in Dallas and Robert N. Noyce, then at Fairchild Semiconductor in Silicon Valley. With the chip, the components of a complete electronic circuit were built on a single slice of silicon.

Still, computers built from the chips stood several feet high, mainly because of the huge core memory they held on reels of magnetic tape. They could control missiles, but were too big for consumer goods such as watches. Something smaller was needed.

Like the technology, the electronics industry itself was in flux. Noyce and Gordon E. Moore left Fairchild to form Intel in July, 1968. Other researchers left companies such as TI or Motorola Inc. to be entrepreneurs.

Hyatt also decided in 1968 to form his own company, but he followed a different path. He avoided the professional circles of researchers in the emerging Silicon Valley in Northern California.

“They all knew each other, but they didn’t know me,” he said. “It was essential I get away from them and do my own original thinking.”

Those who knew him at the time describe Hyatt as slender, mild-mannered and a bit naive for his age. He could be impatient with people who didn’t understand his ideas. The son of a civil engineer, Hyatt knew from an early age that he wanted to be an engineer.

After undergraduate study at UC Berkeley and graduate work at the University of Southern California, Hyatt took a job as a research scientist at Teledyne in 1966. But his ambitions lay elsewhere.

The idea for a computer on a chip evolved over many months after Hyatt began tinkering with designs in his spare time in 1967. He quit his job at Teledyne in early 1968 to devote himself to the project.

Using technology mostly available on the market, Hyatt believes he was the first to put all the pieces together with a design for a small single-chip computer that bucked the industry trend of building ever-bigger computers with high-capacity memories.

“All products are built on technologies of the past,” he said. “Only God can create from nothing.”

Hyatt decided computers could perform relatively simple tasks with far less memory than the room-sized models needed. He chose a compact component known as read-only memory, which could be programmed once with the basic instructions telling the computer what calculations to make. It would work with another memory component called an alterable scratch-pad memory, which could store the data that was subject to change with each computation. Both were small enough to fit on a chip.

In July, 1968, Hyatt trademarked the term “Micro Computer” for the invention. In November, he created a working “breadboard,” or an oversized prototype that demonstrated the chip’s circuitry.

John Salzer, a Santa Monica management consultant, recalled that he was so impressed with Hyatt’s chip design that he invested $5,000 in the company.

In March, 1969, attorney Stuart Lubitz agreed to find more investors for Hyatt and filed incorporation papers for Micro Computer Inc. a month later.

Irving Hirsch, a friend and veteran manager of several small technology firms, joined Hyatt as a partner and invested $60,000 in Micro Computer. Hirsch became president of the company, which moved to an office in Reseda and began hiring employees.

“Hyatt was a very hard worker and one of the most brilliant guys I’ve run into,” said Hirsch, 68, now owner of a lighting distribution firm in Inglewood. “We operated seven days and nights and he was there constantly. We used to work at my house in Woodland Hills and take walks at 1 a.m. or 2 a.m. and talk about the technology.”

Hirsch and Hyatt knew the firm would need about $1.5 million, so they asked Lubitz to search for more investors. Lubitz rounded up a group that included Intel founders Noyce and Moore.

Other investors included Hale Bros. in San Francisco and the San Francisco investment firm of Hambrecht & Quist.

Lubitz served on the board of directors, as did Hirsch, Hyatt, Joseph Chulick Jr. of Hambrecht & Quist, and a Hale representative.

With the venture capital backing, the company moved to Van Nuys in 1970, hiring 25 workers.

But a battle was brewing. Hyatt filed a patent application for the computer on a chip on Dec. 28, 1970. Working through Lubitz, the investors tried to persuade Hyatt to give up rights to the technology if the company closed or was sold, Hyatt and Hirsch recalled.

On July 17, 1971, the investors staged a showdown at a board meeting, Hyatt said. He said Lubitz and Chulick tried to badger him into giving up his rights to the technology. When he refused, the investors withheld their funding.

“I think the investors decided the technology was too good for Hyatt,” Hyatt said. “Their motive was to sell the company and take the technology.”

Lubitz, who later worked as a patent attorney for Intel and is now a Los Angeles patent attorney, said Hyatt was a stubborn, impractical researcher without a viable technology who was obsessed with “paper rights.” He believes Hyatt’s patent has stolen credit from Intel.

“It was a question of whether investors wanted the patents developed with company funds to be assigned to the company,” he said. “Mr. Hyatt refused, and that was the end of it. There was never any mention of a computer on a chip.”

The firm went out of business in September, 1971. Hyatt contends that the investors then leaked details of the chip to the industry, although he will not elaborate on the evidence to back up that claim.

As Hyatt’s dream was unraveling, his rivals were not sitting still.

Between 1969 and 1971, Hoff, Faggin and Mazor at Intel developed a series of four chips that could be sold as a package, including the Intel 4004, a central processing unit on a single chip that before the Hyatt patent was known as the first microprocessor.

TI’s product hit the marketplace about the same time.

Intel and TI went on to become industry giants while Hyatt’s Micro Computer produced only one prototype for one customer.

“It was frustrating watching people exploit my technology and get rich while I was on the sidelines,” Hyatt said.

Unable to find other funding, Hyatt became an aerospace consultant and tinkered with his own inventions at home, eventually collecting more than 50 patents.

But he didn’t give up on the patent quest. Hyatt and his attorney, Gregory L. Roth, knew that under patent law, they did not have to build a working microchip, but only prove it could be commercially built from the design.

They had the benefit of the earliest filing date. But they still had to prove the case to patent examiners. Over the next 20 years, Hyatt and the examiners went through 16 different legal reviews.

In June, 1988, the U.S. Court of Appeals in Washington said Hyatt had not proven that any chip maker could have built a working chip based on Hyatt’s patent application. However, the court broke a stalemate between Hyatt and the patent examiners by acknowledging that he had solved technological problems that eluded earlier designers.

For the next two years, Hyatt built a case based on published industry literature that the technology had existed to create his chip in 1970. He found evidence that TI, Intel and other firms could have fabricated the chip if he had directed them to do so.

The patent examiner finally issued the patent on July 17.

Gary Hecker, a Los Angeles patent attorney who examined the patent, said its claims are broad, apparently covering most microprocessors and other computers contained in a wide range of electronic products.

Enforcing the patent could prove time-consuming and expensive. Hyatt has agreed to testify about his invention in a patent-infringement suit between Zenith Data Systems Inc. and TI, which is trying to enforce patents related to Boone’s microprocessor work.

Hoff and Faggin, the former Intel researchers, feel cheated by the Hyatt patent.

“I feel we at Intel made a very small, very economical processor that was orders of magnitude cheaper than the minicomputers at the time,” said Hoff, a legal consultant in Mountain View. “When you do that, that’s when you really achieve a breakthrough.”

In rebuttal, Hyatt said his chip would have been marketable if only his investors had backed him.

T.R. Reid, a Washington Post reporter and author of the 1984 book, “The Chip,” said that historians may solve Hyatt’s case with the same compromise that ended a 10-year dispute between Intel’s Noyce and TI’s Kilby over the invention of the chip in 1958.

“Kilby got the idea first, but Noyce made it practical,” Reid said. “The legal ruling finally favored Noyce, but they are considered co-inventors. The same could happen here.”