An end to the legal wrangling
Subject: General Tech | November 12, 2009 - 12:45 PM | Jeremy Hellstrom
The decision is in from the AMD versus Intel is in, the Delaware court did not get a chance to rule as AMD and Intel have worked out a settlement themselves worth $1.25 billion. This agreement puts an end to every current legal dispute between the two processor companies across the globe. The exact terms of the agreement were not disclosed, what we do know is that there will be a 5 year cross license agreement between the two companies. This is perhaps not the best possible outcome for AMD, back in 2005 a similar lawsuit ended with Intel able to use the 32/64 bit instruction set that AMD developed without licensing charges, whereas AMD still needed to license the original x86 instruction set.
It is a good year to be a lawyer working for Intel, in addition to this finding that required them to update their financial report for 2009, they just finished an anti-trust suit levelled against them by the EU that resulted in a $1.45 billion fine and New York’s attorney general, Andrew M. Cuomo has filed a different suit.
AMD is benefiting, the cash influx comes at a perfect time for their company, but the end of the legal battle is even more important. This means that there are no more questions about whether the licensing agreements made by Intel and AMD should apply to Global Foundries, the manufacturing arm of AMD that was split off recently. If the licensing agreements were found to not be transferable, the
consequences to Global Foundries and AMD would be devastating. The fact that Intel has agreed to be bound by certain business practices should not only help AMD retain and perhaps grow market share, but we can also hope that the CPU industry becomes a little less melodramatic.
What this means to the consumer is yet to be revealed. Will the two companies continue the fierce price competition we have seen, or does this spell the beginning of a partnership that might see CPU prices begin to rise and innovation begin to slow?
SUNNYVALE/SANTA CLARA, Calif. – Nov. 12, 2009 – Intel Corporation and Advanced Micro Devices (NYSE: AMD) today announced a comprehensive agreement to end all outstanding legal disputes between the companies, including antitrust litigation and patent cross license disputes.
In a joint statement the two companies commented, "While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development."
Under terms of the agreement, AMD and Intel obtain patent rights from a new 5-year cross license agreement, Intel and AMD will give up any claims of breach from the previous license agreement, and Intel will pay AMD $1.25 billion. Intel has also agreed to abide by a set of business practice provisions. As a result, AMD will drop all pending litigation including the case in U.S. District Court in Delaware and two cases pending in Japan. AMD will also withdraw all of its regulatory complaints worldwide. The agreement will be made public in filings with the Securities and Exchange Commission.