Intel Wins Ethernet Data Communication Patent Fight

In a complicated legal proceeding, the court sided with Intel and said that the company did not infringe on patents #5,361,261; #5,533,018; #5,566,169, and #5,594,734.

The patents were originally assigned to National Semiconductor (NSC), but were given to Vertical Networks in 1998, and to N-Data in 2003. The patents were changed over time, and reissued, as Vertical increased the number of its claims from 77 to 378. As N-Data got a hold of the patents, the company sued Dell in 2006 over patent infringement and was able to reach a settlement in 2009. Intel intervened in the case and eventually filed a declaratory judgment that under the NSC Agreement, which Intel had signed in 1976, but which had expired in 2003. Intel said that itself and its customers are licensed to the National patents and all reissue patents owned by N-Data that are derived from any of the National Patents.

According to the court papers, Intel's license expired in 2003, but Intel claimed that the original agreement with NSC naturally extends to reissue patents that derive from National Patents. N-Data said that the reissued patents are separate patents "that cover unique property rights" which would need a separate license. In the original ruling, the District Court granted a summary judgment to Intel "because the agreement reflects the intent of the parties to license not only the literally described patents and patent applications, but also the reissue progeny of those licensed patents and patent applications from which the reissues were derived." The Court of Appeals judge David Folsom agreed with this conclusion.

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