NEW YORK -- Rambus Inc. is threatening to impose higher royalty payments or even refuse licensing rights to three semiconductor manufacturers, which have engaged in a series of court battles with the intellectual property (IP) developer rather than agreeing to patent license terms.
"The companies that litigate against us may pay higher royalty fees, and if they lose [in court] they may not get [a] Rambus patent," said Gary Harmon, Rambus' chief financial officer, at the third annual Needham & Co. Inc. Growth Conference in New York.
Rambus of Mountain View, Calif., faces challenges to its synchronous memory and processor interface technology from Infineon Technologies, Hyundai MicroElectronics, and Micron Technology. Rambus said the first of the lawsuits involving Infineon will open in a Virginia court in March. Another lawsuit against Infineon, which was previously scheduled for February in Germany, has been pushed to May following the reassignment of the presiding judge, Harmon said.
Today's statement by the senior Rambus executive indicates the company is raising the stakes in its continuing struggle to license its IP to DRAM manufacturers and collect royalties on products shipped by OEMs that use the interface. The company would prefer an out of court settlement of the various lawsuits, Harmon said.
In addition to the computer market, Rambus said it is pushing its IP into new applications, such as consumer products and networking equipment, and may try to shut out Infineon, Hyundai, and Micron in these areas or charge higher fees for their use of the disputed IP.
"Right now we collect 1% or 2% in royalty payments per product shipped," Harmon said. "The difference is [these are] the guys who helped us in our early days. Those fighting us may theoretically pay as much as 10%."
Even then, Rambus stands to lose a huge amount of money if it fails to win the lawsuits, acknowledged Harmon. The company has signed licensing agreements with all other major DRAM suppliers, but the contracts may be nullified if its patents are not upheld in court.
"If all our patents were lost through litigation, then theoretically all the agreements we have signed will be invalid," Harmon said
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