Latest Salvo: Intel Countersues Digital
Intel Corp. countersued Digital Equipment Corp., accusing the company Tuesday of violating 14 of Intel’s chip patents in the ongoing legal battle between the companies.
Intel, the world’s largest chipmaker, said the alleged patent violations cover a range of technologies including the design of microprocessors, the manufacture of semiconductors, the compression of video and other technologies.
Intel’s move was an expected response to Digital’s surprising May 12 lawsuit that charged Intel with violating 10 Digital patents. Intel claimed that the computer maker is using its technology unlawfully in everything from its flagship Alpha processor to its PCs. Such a shotgun approach is a frequent strategy when a company faces a patent lawsuit, attorneys said.
“Intel looked through its patent portfolio and saw what arrows it could put in its quiver,” said Jerold Jacover, a patent attorney with Brinks Hofer Gilson & Lione in Chicago.
Still, Jacover and other lawyers and analysts expect the companies to settle their suits without going to trial, with Intel likely to concede the least.
“Intel’s got so many patents on microprocessors, it’s a desperation move by Digital,” said Dan Niles, an analyst at Robertson Stephens & Co.
Maynard, Mass.-based Digital has lost money in five of the past six years as sales of computers using its Alpha chips failed to take off, in spite of the advanced technology.
Intel’s suit, filed in the U.S. District Court of Massachusetts, accuses Digital of infringing on patents issued to Intel from 1984 to this year. Intel said it sued simply to defend itself against Digital’s claims.
“This isn’t punitive,” said Chuck Mulloy, an Intel spokesman. “We wouldn’t be in this position if we weren’t being sued.”
While the legal wrangling likely will drag on for months or even years, Intel said it will honor its contract to sell its Pentium chips to Digital. Mulloy said the agreement runs through the fourth quarter and will be renegotiated then.
Tuesday’s actions are separate from another lawsuit Intel filed against Digital. That suit charges Digital with breach of contract for not returning microprocessor designs and other Intel technology that it gives PC makers to design machines around new Intel chips. Intel chips run 85% of the world’s PCs.
Digital said its view hadn’t changed in light of Intel’s response.
“Intel has unlawfully used Digital’s patented technology,” said Dan Kaferle, a Digital spokesman. “Intel’s action is a typical step for a company that has been sued for patent infringement. When we receive a copy of their filing, we will study it and be able to respond appropriately.”
Digital’s May suit charges that Intel designed its best-selling Pentium processors with technology Digital developed for its Alpha chip. It seeks unspecified damages from Intel, one of its suppliers.
