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Intel, FTC prepare for antitrust showdown








EE Times


WASHINGTON — Intel Corp. and the Federal Trade Commission are putting the finishing touches on their cases in advance of a much-anticipated Feb. 23 hearing on antitrust allegations against the chip maker.

The trial was delayed in October by mutual agreement to allow both sides to collect more evidence, a process referred to as third-party discovery. The heavy case load of James Timony, the FTC administrative law judge overseeing the case, also contributed to the delay. The trial originally was to begin on Jan. 12.

Government attorneys said Intel has the right as the respondent to subpoena third parties for information related to its defense. The process is often time-consuming, particularly when proprietary information is sought. "We've had to work through those delays," said William Baer, director of the FTC's Bureau of Competition.

"There is a lot of discovery," an Intel spokesman said, adding that the antitrust law in the case is relatively narrow, but that the alleged impact of the law on the semiconductor industry is large.

The spokesman wouldn't discuss what information Intel is seeking, but said it is "largely procedural" and that Intel attorneys are contacting a "broad set" of companies as it builds its defense.

The FTC argument

Baer also declined to discuss the specifics of the government's strategy in the antitrust case. "We're going to go in and prove what the FTC complaint says," he said. That includes allegations that Intel illegally used its market power to deny Digital Equipment Corp., Intergraph Corp. and Compaq Computer Corp. continuing access to technical information needed to develop systems based on Intel microprocessors. Intel denies the government's charges.

"Every issue will be hard fought and contested," Baer said. "There is no secret strategy here."

Baer also declined to discuss whether the FTC's case will include broader allegations about Intel's chip-design and licensing practices. Industry sources confirmed last summer that FTC lawyers were probing whether interface changes made by Intel in its Pentium chip design represented an improvement in performance or instead created incompatibilities that locked in OEMs.

The Intel spokesman said the company's goal is to convince FTC Judge Timony that Intel acted within its rights. "The key disagreement will be whether Intel's market success restricts our ability to use our intellectual-property rights as we see fit," he said.

The burden of proof in the Intel antitrust case rests with the government. Baer said the FTC must convince Timony that Intel acted as a monopolist in its dealing with Digital, Intergraph and Compaq.

Intel will be represented before the FTC by the Washington law firm Gibson, Dunn and Crutcher. Joe Kattan, a lead attorney for Intel, could not be reached for comment.











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