And while few, if any, seriously believe that the courtroom battle with Synopsys Inc. will take Magma tools off the shelves, most agree that the nine-month-old dispute has become, at the least, a costly distraction for the younger company.

Magma shares dropped 40 percent last Wednesday after Lukas van Ginneken, the company's co-founder and former chief scientist, acknowledged that he conceived the technology underlying Magma products while still employed at Synopsys.

His eight-page declaration was made in connection with Synopsys' patent infringement suit against Magma. After van Ginneken made the declaration, Synopsys dropped him as a defendant in the case.

"I used for Magma's benefit the inventions contained in Synopsys' draft patent applications, and the inventions from these applications ultimately formed the basis for the patent applications I helped prepare for Magma," van Ginneken said in his declaration, the latest twist in a fight that began last July. That's when Magma, in a letter, warned Synopsys of possible violations of three patents. Synopsys, noting that former employee van Ginneken wrote two of those patents, responded by suing Magma, maintaining that the patents were based on technology van Ginneken developed at Synopsys.

It's too early to conclude that Magma's IC design products will be imperiled, observers say. Even if Magma ultimately loses, they say, there's likely to be some sort of settlement that keeps the company's IC implementation tools alive. EDA technology is rarely, if ever, taken out of customers' hands for legal reasons.

But an injunction against Magma products would be a devastating blow, and Magma is still small enough that the litigation is a significant cost. Litigation expenses, including its defense against the patent-infringement suit and an injunction sought by Synopsys, are expected to cost Magma 25 cents per share over the coming year.

And it's certainly a distraction as Magma rolls out its Cobra products, which it calls the next generation in IC physical design (see Feb. 7, page 32).

In the declaration, filed with the U.S. District Court for Northern California, van Ginneken said that two Magma patents he wrote disclose inventions he conceived at Synopsys.

"With Dr. van Ginneken's compelling description of Magma's misappropriation, we intend to continue pursuing this case aggressively to protect Synopsys' technology, and ultimately to obtain full injunctive relief," said Rex Jackson, Synopsys vice president and general counsel.

From Magma's point of view, however, it's simply a Synopsys-drafted declaration that van Ginneken signed in exchange for getting off the hook in a $100 million lawsuit. "It's actually produced more for public consumption than legal consumption," Magma president Roy Jewell said last Wednesday. "What happened in the past 24 hours was done specifically to try to disrupt our business activities."

In the declaration, van Ginneken said he conceived of the "fixed timing" concept at Synopsys in 1996. With that technology, the timing delays of a chip design are held constant, rather than determined later in the design flow. Van Ginneken went on to say that the disputed patents, U.S. patents 6,453,446 and 6,725,438, disclose "inventions which I conceived while employed at Synopsys."

In a preannouncement of its fiscal fourth quarter, ended March 30, Magma reported lower-than-expected revenue and earnings, citing litigation expenses as well as delays in orders. Magma expects litigation expenses of about $8.5 million over the next year, Jewell said. The company must carry that burden even as it fights for technical leadership in IC physical design.