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Technology Stocks : Rambus (RMBS) - Eagle or Penguin
RMBS 95.26+3.1%Nov 14 9:30 AM EST
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To: jim kelley who wrote (39043)3/29/2000 2:51:00 PM
From: Dan3  Read Replies (3) of 93625
 
Re: So why did Hitachi sign a license with RAMBUS in the first place? It gets better all the time!

Jim,

I don't know if you have much experience with litigation of technical contracts (I have some, but it is certainly not comprehensive), but there is a point of law relating to contracts called "fraud in the inducement". It's not nearly as criminal as it sounds, but is basically the way in which a contract is invalidated when one party misrepresents a contract to another party. Typically this inducement is done outside of the language in the contract, and even when the contract explicitly states that it is the entire agreement between the parties, the contract can (and often is) thrown out if it can be shown that one side misrepresented the contract to the other - even if it was only a verbal misrepresentation.

I doubt Hitachi would have signed any agreement with Rambus that would require them pay to Rambus royalties on products they had developed without Rambus help and had been selling for years. If Rambus has been able to come up with some interpretation of the contracts they have been entering into that requires such payments, it is just as likely to invalidate the entire contract as it is to compel any kind of enforcement.
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