SANTA CLARA, Calif. -- One legal headache for Intel Corp. is over while another court battle is heating up.
Intel today announced the U.S. government has provided notification that it has closed a three-year-old antitrust probe of the company, but also today came reports that Broadcom Corp. has asked a California court for a preliminary injunction against Intel for alleged theft of trade secrets.
The court action is in response to Intel's charges that Broadcom had infringed upon its patents and misappropriation of trade secrets (see Aug. 30 story).
Irvine, Calif.-based Broadcom named Intel and the company's Level One Communications subsidiary in the lawsuit. Reports from Reuters news service today quoted a Broadcom spokesman as saying, "What we want is for an order that would put Broadcom back in the position it would otherwise have enjoyed if Intel hadn't employed Broadcom's technology."
Intel's lawsuit, filed last month in the U.S. District Court of Delaware, charges Broadcom with a "carefully crafted plan" to base its business around Intel's communications-chip technology. The suit follows Intel's move last March to file an injunction in the Superior Court of California against several former employees from joining Broadcom, its rival in communications ICs. The ex-Intel employees were reportedly working on key projects within Intel's Level One Communications subsidiary, which supplies transceivers, hub ICs, and telecommunications chips. Intel acquired Level One last year for about $1.2 billion.
Within a week after Intel's suit, Broadcom CEO Henry T. Nicholas III called the most recent charges "outrageous" and he accused the Santa Clara chip giant of resorting to "specious litigation in the courts rather than competition in the marketplace" (see Sept. 5 story).
Meanwhile, Intel sees the closing of the U.S. antitrust probe as vindication. The Federal Trade Commission had been investigating Intel's business practices since September 1997 in response to complaints by Intergraph Corp., Compaq Computer Corp. and Digital Equipment Corp. An earlier case was settled in March 1999, but the FTC said it would continue investigating Intel's business practices, including its growing strength in the chip set market.
"The closure of the investigation reflects our view that Intel conducts its business in an ethical and lawful manner," Intel chairman Craig Barrett said in a statement. Intel said it was informed in a letter to Barrett from Richard Parker, director of the FTC's Bureau of Competition, that the antitrust investigation was being closed.
The FTC also closed its investigation of whether Intel's acquisition of Chips and Technologies Inc. and its equity in Real3D had any anti-competitive effect on the graphic components market or other computer hardware markets, Intel said. The FTC had announced in February 1998 that it would not sue to block those acquisitions, but was keeping its file open to continue to review their possible effects.
--Additional reporting by George Leopold of EET.