Intel ordered to pay $949 million in VLSI patent trial
Intel has suffered a major blow in its patent saga against VLSI, a patent-holding company affiliated with Fortress Investment Group, a hedge fund under SoftBank Group. A Texas jury gave a $948.8 million verdict against Intel for violating VLSI's patent for computer chips. Intel said that it will appeal against the decision. In two previous patent trials between them, both parties shared the spoils.
Why does this story matter?
It's another one in the loss bracket for Intel in its patent war against VLSI. After the first trial where it was at the receiving end of a historic verdict, Intel may have felt good about itself after the second trial. However, this verdict tilts the needle in favor of VLSI again. It needs to be seen how Intel makes a comeback from this.
VLSI argued that Intel violated patents covering data processing improvements
In the trial that lasted for six days, VLSI's lawyers argued that Intel's Cascade Lake and Skylake microprocessors violated its patents covering improvements to data processing. This was the third trial between the two regarding patent infringement. In the first, a jury in Vaco, Texas awarded VLSI nearly $2.2 billion in damages for infringing two patents. In the second, VLSI lost the trial.
Intel said that the US patent system needs urgent reforms
During the trial, VLSI's lawyers said that Intel's chips are causing "millions and millions of infringements" every second. Intel's lawyers argued that the innovations were independently developed and that the chipmaker's microprocessors won't work with VLSI's outdated technology. Reacting to the verdict, Intel said that the verdict is an example of the need for urgent reforms in the US patent system.
Intel called VLSI a 'patent troll'
Intel had some strong words for VLSI after the verdict was pronounced. It called VLSI "a 'patent troll' created by Fortress, a hedge fund that is bankrolled by sovereign wealth funds." The company said that the sole purpose of VLSI is to file "lawsuits to extract billions from American innovators" like itself. It called the patent infringement claim "meritless."
Two more trials are pending between Intel and VLSI
The patent in question was bought by VLSI from dutch chipmaker NXP Semiconductor NV. Apart from the three concluded trials, two more lawsuits between VLSI against Intel are pending in Northern California and Delaware. The Delaware trial was paused by the judge earlier this year citing insufficient information provided by VLSI about investors in the company.
