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Rambus wins Hynix chip patent case

Rambus awarded $307 million by California jury that found South Korea’s Hynix violated its memory chip patents.
/ Source: Reuters

Rambus Inc. was awarded $307 million on Monday by a jury that found South Korea’s Hynix Semiconductor Inc. violated the computer technology and research company’s memory chip patents, boosting Rambus shares more than 16 percent.

The jury in the U.S. District Court for Northern California in San Jose ordered Hynix, the second-biggest maker of memory chips in the world, to pay $30.5 million in damages regarding patents on a type of DRAM computer memory known as SDRAM and $276.4 million on a type known as DDRSD.

Rambus of Los Altos, California, developed technology to make these chips run faster and the company has similar suits pending with other memory chip makers, such as No. 1 Samsung Electronics Co. Ltd., also of South Korea, and Micron Technology Inc..

“The other companies have to and will study the results here and decide if they want to continue on the same course,” Rambus General Counsel John Danforth said after the verdict.
Rambus also wants to stop memory chip companies which do not pay it to stop making chips.

“The real issue here is, can they continue to make these products after they’ve been found to infringe on a slew of patents?” he said.

Hynix lead attorney Dan Furniss said the fight was not over and that his company next would seek to prove the patents were unfair.

“We will seek an order finding these patents unenforceable because they were anti-competitive,” he said.

The case, which went to trial a month ago after six years of legal wrangling, has been closely watched in the $20 billion-a-year market for computer memory chips known as DRAM, or dynamic random access memory.

The verdict increases Rambus’ prospects in the remaining legal issues with Hynix as well as in its cases against Samsung and Micron, said John Ward, an intellectual-property attorney with Greenberg Traurig in Palo Alto, California.

“If I were Rambus, I would certainly be very happy with the verdict in hand to be able to negotiate some settlements with Hynix and other defendants as well,” Ward said. “It’s going to increase their leverage and their negotiating power against the other defendants.”

Rambus shares, down 27 cents on the day before their trade was halted pending the verdict, jumped more than $6, or about 16 percent, to $44.90 after trading resumed at 2 p.m. Eastern time. Rambus’ stock has more than tripled in the past six months on expectations it would prevail in the patent lawsuit.

“The decision removes most of the overhang on the stock, although Hynix could certainly continue further legal battles until there is an ultimate resolution,” said Tim Biggam, options strategist at Man Securities.