Intel and VLSI this week agreed to settle one of their ongoing legal disputes. The legal battle in Delaware covered five patents, and VLSI asked for more than $4 billion in damages, reports Reuters. Meanwhile, the two companies have several more ongoing litigations in California and Texas.
The two parties agreed to settle the dispute in Delaware with prejudice, so the lawsuit cannot be brought to court again. VLSI agreed not to sue Intel's customers and suppliers over the five CPU patents at the issue of the case, whereas the processor giant agreed to dismiss its counterclaims. The two companies will not pay anything to each other.
"The parties have agreed to dismissal of claims and counterclaims asserted in this action," a court filing reads.
Intel and VLSI have a huge continuing legal battle in different courts across the U.S. and other countries. VLSI says Intel has infringed 19 patents that originate from Freescale, SigmaTel, and NXP. Some of the allegations have been dismissed by juries, but many cases are still ongoing.
The Delaware case covering five CPU patents could have been the most fruitful one for VLSI, which asked for $4 billion in damages. Still, the parties decided to dismiss it. Meanwhile, in March 2021, a district judge in Waco, Texas, ordered Intel to pay VLSI $2.18 billion for infringing two of its patents related to frequency management and lowering memory voltage. Intel failed to overturn the ruling in August 2021. This November, a federal jury in Texas ordered Intel to pay VLSI nearly $949 million for infringing its 7,242,552 patent, which covers a method for lessening the problems of defects caused by stress applied to bond pads.
Intel and Apple have accused VLSI of unlawful patent aggregation. The chip giant also says that VLSI's complicated ownership structure allowed its investors "reap any benefits from this suit" while "concealing their identities from the court and the public." Meanwhile, VLSI is controlled by Fortress Investment Group, a private equity firm owned by SoftBank. SoftBank also owns Arm.
Intel has agreed to dismiss its 2 counterclaims which already have a judgement against Intel totally over $3 billion($2.18 billion + $949 million), doesn't that mean they are going to pay that obscene amount? Looks like a big L to Intel, just prevents future fighting for the moment at a high extortion amount.
That doesn't make any sense. . . why would Intel owe money from their own counterclaims? That's not how any of this works. . .
Different cases and trials.
Those two precious judgements are pending appeal, which is legally distinct from a counterclaim. A counterclaim just means that Intel is suing VLSI for something that is related to the initial claim as part of the same suit. The end goal is to either dismiss the suit or to at least mitigate the damage. It also allows future legal action to be on the table. Super simplified version is that VLSI claims patent infringement over Patent A. Intel counterclaims that patent A is invalid or something to that extent. Or that they own Patent B that is necessary for Patent A to even exist. I assume it's referring to something that Intel claimed for the Delaware case that they're dropping now.