Gene, it is the responsibility of an IP owner to "go after" infringers, otherwise it put at a disadvantage those that are paying license fees and royalties. RMBS was correct to sue Hitachi, since after a number of years of negotiations, Hitachi with wonton affront, refused to talk any deal, probably used the privileged (confidential information) supplied by RMBS in initiating the negotiations, in their shipping products, while others, like Toshiba, paid licensing fees and royalties. In rare cases, the court may force an owner of IP to license its IP to whomever wants it (Xerox was forced to license out its IP because they reached a monopolistic state), but in the case of RMBS, the IP license was offered and turned down. You could say that it is Hitachi "policy" not to pay Royalties, but that does not hold water, they pay royalties to SNDK on the flash technology IP suite of patents held by SNDK. Hitachi runs a major risk of being closed out of the DRAM business altogether (and their venture with NEC will go down the drain) if they do not settle this issue.
Toshiba motives are quite clear, they would love to see Hitachi out of the DRAM business, since they will be in an excellent position to pick up the pieces, furthermore, if that were to happen, a real shortage in DRAM will develop, making Toshiba 6% of the market (going to 10% if Hitachi is forced out?) so much more profitable, fully compensating them for the puny royalties rate. RMBS' management is quite smart in using the "weak link" in the dramurai chain to create a precedent and a pressure point on the industry.
I think that there are a lot of "things" going on which we, as investors, have no clue about. One reason why I keep a set of turnips to warn me of the unknowns. While I am currently very bullish on RMBS, this situation could turn on a dime, particularly if the Dramurai indeed have something in their back pocket pointing out to RMBS' innovation really being in the "public domain". I am guessing that Hitachi would not have fought this issue if they did not think that they had a real response. So far, however, what we have seen from Hitachi on this subject was quite lame (the JEDEC argument does not hold water if you look at the dates, and the monopoly argument does not hold water since they were offered a fair license on the same basis as other in the industry).
Zeev |
