Charging Rambus Inc. with trying to "coerce exorbitant royalties" from the DRAM industry, Micron Technology Inc.'s antitrust lawsuit will determine the validity of key patents that serve as the foundation for much of the computing world's memory requirements.
The suit, filed yesterday in U.S. District Court in Delaware, seeks to invalidate patents Rambus holds pertaining to a synchronous interface used in billions of memory devices, processors, and core-logic chipsets and seeks unspecified damages from Rambus as well as treble punitive damages allowed under antitrust law.
Micron, Boise, Idaho, is alleging that Rambus is unduly coercing makers of SDRAM and double-data-rate SDRAM chips as part of a strategy "to file lawsuits against those manufacturers who do not agree to Rambus' non-negotiable license terms."
Rambus, Mountain View, Calif., is the designer of a competing Direct Rambus DRAM interface, but early this year also claimed rights to technology that serves as the basis for SDRAM designs. The company has systematically negotiated agreements with several DRAM makers and recently sued Infineon Technologies AG for its refusal to agree to SDRAM licensing terms. That suit is pending in a Delaware federal court.
According to Micron, Rambus is seeking to gain an unfair competitive advantage for Rambus technology -- which to date has been more expensive than SDRAM to manufacture -- and as much as "admitted that it intends to charge more for licenses to SDRAM products that it views as a threat to its own RDRAM technology."
In its response to the suit, a Rambus spokeswoman said the company "initiated negotiations with Micron to license Rambus' intellectual property for use in SDRAM and DDR SDRAMs. We expect to be fairly compensated for use of our IP. Rather than negotiate, Micron chose to litigate," she said.
However, in the suit, Micron said it took legal action because it was expecting to be sued by Rambus. Micron suggested that it was being targeted by Rambus because it has been a prime advocate of DDR SDRAM -- even as it has continued to develop Direct RDRAM under an existing license. A Micron spokesman said despite the complaint, the chip maker will continue with plans to validate its Rambus prototypes.
The move follows word earlier this year that an ad hoc group of DRAM vendors was considering filing an industry-led antitrust suit with the Federal Trade Commission. Micron, which was among the member companies said to be pondering the action, declined to comment Tuesday if plans to take its case to the FTC.
The looming court battle is expected to hinge on legal precedent set by Dell Computer Corp., which was found in 1996 by a federal court to have sought out royalties for patents that the company helped draft as part of open industry standards deliberations. A similar case involving Wang Laboratories was settled out of court, but is also expected to play a part in Micron's legal attack plan.
Specifically, Micron is claiming that industry procedures required Rambus to disclose any pending patents related to the development of a synchronous interface when the topic was discussed from 1991 through 1996 during open JEDEC standards forums. By failing to disclose its development plans, Rambus in effect obtained information which it then subverted to preempt competitors, Micron is charging.
"Instead of offering a royalty-free or other reasonable license when it was obligated to do so, Rambus waited until the standards had been adopted and the industry had spent billions of dollars in reliance on the standards," the suit alleges.
The same argument was presented earlier this year when Hitachi Ltd. fell under Rambus' legal crosshairs, but has never endured a legal test. Hitachi settled with Rambus before the case was brought to trial.