Intel Absolved of Antitrust Charges

A U.S. federal judge has thrown out the antitrust portion of a three-tiered lawsuit filed against Intel Corp. by Intergraph Corp., an Alabama-based technical solutions and system integration company, officials from the two companies have confirmed.

The original lawsuit, filed in November of 1997, charged the chip giant with patent infringement related to Clipper microprocessor technology, violation of antitrust laws for withholding information from Intergraph, and seven violations of Alabama state business law, according to representatives of both Intel and Intergraph.

Clipper technology relates to a family of discontinued, general-purpose microprocessors used in workstations during the late 1980s.

The technology, first developed by Fairchild Semiconductor in 1988, was licensed for use by Intergraph until Fairchild was purchased by National Semiconductor. After the purchase, Intergraph bought the Clipper patent and all intellectual property from National Semiconductor.

Then, according to David Lucas, the senior legal council for Intergraph, Intel approached Intergraph to cross-license the Clipper technology without providing sufficient details as to its use or application by Intel.

When Intergraph refused the cross-license request, Intel began withholding information pertaining to the integration of Intel-based systems that is normally shared with its OEMs who design, build, and service Intel-based computing systems. The sudden lack of information made it nearly impossible for Intergraph to continue to produce and service products powered by the latest Intel technology, Lucas claimed.

In October, U.S. District Judge Edwin Nelson threw out the patent infringement portion of the lawsuit, claiming Intel did not infringe on the Clipper patent owned by Intergraph, according to Intel.

And last Friday, Nelson ruled that Intel did not break federal antitrust regulations in its refusal to share the technical data with Intergraph.

The ruling was based on a recent federal ruling in the case of Xerox vs. The Independent Services Organization. According to Lucas, the still-unpublished ruling carves out the equivalent of an antitrust immunity for companies that own the patent to a particular product or technology.

“The ruling basically states that if you own the patent, you have no duty to deal, sell, or supply,” Lucas said. “What this means in today’s computer market is that you can expect Intel, when they begin shipping their next generation of products, like the Itanium processor, to have no reason to license the product to anyone they don’t want.”

“They can maintain a monopoly on any technology they [have patented] and go forward with it. They will no longer be compelled to share information with anybody not inside the club,” Lucas explained.

A few of the seven Alabama state laws still facing Intel include intentional interference, suppression of material fact, breach of contract, breach of warranty, and negligence for breaching standards of care, according to Lucas.

“At this stage, we will likely file a motion to have the state actions thrown out, but we are continuing to litigate and remain confident that once we’re through, it will be clear that Intel’s behavior was lawful,” said Intel spokesman Chuck Mulloy.