Emulex, Digital Settle Patent Infringement Suits

Trying to patch up relations with a major customer, Emulex Corp. said Monday that it has settled patent infringement litigation with computer giant Digital Equipment Corp.

Under the settlement, the computer components maker will phase out by the end of 1992 a line of products, known as SDI/STI, which connect Digital computers to each other and to other storage devices, said Robert N. Stephens, Emulex’s chief executive.

Digital sued Emulex on Aug. 13 for allegedly infringing four patents. Emulex denied the claims and responded with a countersuit. Both companies will now drop the suits.

“This is a practical decision,” Stephens said. “Besides competing with Digital, we also sell a lot of products to them. The lawsuits made the relationship awkward.”

Since Digital began enforcing its SDI/STI patents in April, 1989, more than 20 companies have decided to stop making the products rather than tangle with Digital in court.

Emulex will be hard-pressed to replace the lost revenue. The SDI/STI storage products accounted for about 15% to 20% of Emulex’s $153 million in revenue last year.

But Stephens said that the product line was becoming obsolete and that his company is diversifying into other technologies.

The settlement leaves Micro Technology Inc., a storage products manufacturer in Anaheim, as one of a handful of companies in the industry still battling Digital.

Stephens said neither company will make payments to each other under the settlement.