U.S. government closes Intel investigation

The U.S. Federal Trade Commission (FTC) formally and finally closed its investigation into anticompetitive behavior at Intel Corp.

An FTC spokesman confirmed the news Tuesday morning, but wouldn’t comment further on the case.

In a statement, Intel president and CEO Craig Barrett said, “The closure of the investigation reflects our view that Intel conducts its business in an ethical and lawful manner.”

The announcement comes a year and a half after the FTC and Santa Clara, Calif.-based Intel settled an antitrust lawsuit one day before the FTC’s lawsuit was to go to trial. Despite the settlement, the FTC continued the investigation and labeled the chipmaker a monopolist, since it had, at the time, an 80 per cent market share for general-purpose microprocessors.

The settlement prohibits Intel from withholding technical information or refusing to sell microprocessors to a customer involved in a dispute over intellectual property unless the customer is seeking a court injunction to prevent Intel from selling the products related to the dispute.

An antitrust investigation began in 1991 when Advanced Micro Devices Inc. and Cyrix Corp. sued Intel over antitrust claims. AMD lost its suit in June 1992. National Semiconductor Corp. eventually bought Cyrix and settled that suit in February 1998.

The FTC closed its first investigation in 1993 without taking action but then opened a broad investigation into Intel’s business practices in September 1997, after Digital Equipment Corp. filed a suit in May that year, alleging that the processor maker infringed upon Digital’s Alpha Chip design.

A month after the investigation was opened, Digital and Intel settled their case, but the investigation continued. Computer workstation manufacturer Intergraph Corp. in Huntsville, Ala., sued Intel in November of that year over microprocessor patents. Intergraph added an antitrust violation right before the trial was to begin, and Intel countersued.

In an April 1998 preliminary ruling, U.S. District Court Judge Edwin Nelson said Intel probably abused its monopoly power by withholding information from Intergraph. In June of that year, the FTC filed suit against Intel for monopolizing the microprocessor market by withholding the right to use its intellectual property from Digital, Compaq Computer Corp. (which now owns Digital) and Intergraph.

Shortly after the settlement was announced, Motorola Inc. sued Intel on antitrust grounds. In March, Nelson dismissed Intergraph’s remaining antitrust claims against the chip giant.