Hi KeepItSimple; Huh? What Hitachi was accusing Rambus of, including dates &c:
99. In 1991, JEDEC members began considering the development of standards for SDRAM technology. Rambus began attending JEDEC committee meetings no later than December 1991 and formally joined as a committee member at least as early as 1992.
JEDEC's Disclosure Rules
100. Before Rambus had attended its first JEDEC committee meeting, JEDEC members had established and had been following a policy governing the disclosure of patents and patent applications of those firms and individuals participating in its meetings: all participants in the meetings were obligated to inform those present of any knowledge they had of any patents or pending patents that might relate to the work the JEDEC members were undertaking. Participants were thus required to disclose any patents or patent applications that could bear upon a standard that JEDEC members had under development. Upon disclosure, holders of patents or applications were to make their patents available without charge or under reasonable terms and conditions that were demonstrably free of any unfair discrimination.
101. The purpose of JEDEC's policy governing the disclosure of patents and applications was to prevent any single firm from secretly capturing the industry standard and to prevent an unscrupulous member from manipulating the standards-setting process to its personal advantage, so it could extract unreasonable and discriminatory royalties from those who manufacture their products to be compatible with the standard.
102. An example of the disclosure 's importance occurred in the early 1990s. In the early 1990s, two JEDEC members, Wang Laboratories, Inc. ("Wang") and Mitsubishi Electric America, Inc. ("MELA"), became involved in a patent dispute relating, in part, to Wang's failure to disclose certain patent applications in accordance with the JEDEC disclosure policy. Wang first sued MELA alleging patent infringement. MELA countersued Wang, asserting that Wang's failure to disclose the patent applications rendered the resulting patents that issued unenforceable through equitable estoppel, and that, by failing to disclose the patent applications and by trying to enforce the resulting patents, Wang violated the antitrust laws. Wang Lab., Inc. v. Mitsubishi Elec. Amer. Inc., No. CV 92-4698 JGD (C.D. Cal. 1993).
103. Wang moved for summary judgment on MELA's equitable estoppel defense. The district court denied the motion, holding that MELA had created a genuine issue of fact in support of the equitable estoppel defense. MELA eventually prevailed at a trial that did not address MELA's antitrust claims. The case was resolved before those claims were fully litigated.
104. In the wake of the Wang litigation, JEDEC formally amended its rules to expressly state what had always been its policy, that is, that JEDEC participants were required to disclose any patents and patent applications potentially bearing on JEDEC's standards-setting discussions. By October 1993, JEDEC had amended the JEDEC Manual of Organization and Procedure to include a provision stating: The Chairperson of any JEDEC committee, subcommittee, or working group must call to the attention of all those present the requirements contained in EIA Legal Guides, and call attention to the obligation of all participants to inform the meeting of any knowledge they may have of patents, or pending patents, that might be involved in the work they are undertaking. (JEDEC Manual of Organization and Procedure JEP 21-I (Revision of 21-H) October 1993.)
105. Consistent with its disclosure policy, JEDEC called for "viewgraphs" to be posted at committee meetings. The recommended viewgraph stated: Standards that call for use of a patented item or process may not be considered by a JEDEC committee unless all of the relevant technical information covered by the patent or pending patent is known to the committee, subcommittee, or working group. In addition, the committee Chairperson must have received written notice from the patent holder or applicant that one of the following conditions prevails:
A license shall be made available without charge to applicants desiring to utilize the patent for the purpose of implementing the standard(s), or
A license shall be made available to applicants under reasonable terms and conditions that are demonstrably free of any unfair discrimination.
In either case, the terms and conditions of the license must be submitted to the EIA General Counsel for review. An appropriate footnote shall be included in the standard identifying the patented item and describing the conditions under which the patent holder will grant a license. (EIA/JEDEC Patent Policy Summary, JEDEC Manual No. 21-I at 23.) Viewgraphs of that nature were posted at JEDEC meetings.
106. JEDEC's rules thus imposed a "duty to speak" on meeting participants holding relevant patents or pursuing potentially relevant patent applications. The duty to speak was particularly significant for pending patent applications because pending patent applications are not publicly available. JEDEC members and participants had to rely on the good faith of their fellow JEDEC members and participants to comply with this duty to speak if JEDEC members were to develop truly open standards, as was their charter.
107. JEDEC's duty-to-speak policy and disclosure rules implementing that policy remained in effect while Rambus continued as a member of JEDEC. Rambus was aware of that duty. For example, in late 1993, Rambus disclosed to JEDEC members and participants Rambus' U.S. Patent 5,243,703 ("the '703 Patent"). Rambus disclosed the '703 patent even though the detailed, narrow claims of that patent were not directly pertinent to the potential SDRAM standard then being discussed. Rambus has not asserted the '703 patent against Hitachi's products. Nevertheless, Rambus' disclosure of the '703 patent demonstrates that Rambus was aware of JEDEC's requirement that JEDEC members and meeting participants disclose all potentially relevant patents and patent applications.
108. Throughout the time periods relevant to this case, Rambus knew or should have known of JEDEC's pre-1993 patent policies, the Wang litigation, and the 1993 formalization of JEDEC's patent disclosure rules.
Rambus' Participation in JEDEC
109. In 1991, JEDEC members began discussing various technological features for inclusion in an industry standard for SDRAM technology, including an interface technology standard. In developing that standard, JEDEC members and participants discussed, in open meetings, interface technology features such as external and internal clocking, mode registers, latency, and storable burst. Rambus was present at, and participated in, those meetings. Rambus now asserts that those features are covered by the Patents in Suit.
110. Beginning in 1991, and continuing through a series of meetings over a several-year period, JEDEC members developed and approved SDRAM technology standards, including an SDRAM interface standard.
Rambus' Failure to Disclose
111. From 1991 to the filing of this lawsuit, Rambus never affirmatively disclosed to JEDEC or its members and participants that Rambus purported to have enforceable patent rights or patent applications which potentially could cover the JEDEC SDRAM interface standard.
112. From 1991 to 1995, and thereafter, Rambus was silent about its patent applications leading to the Patents in Suit, despite its duty to disclose to JEDEC members the nature and existence of those applications.
113. Rambus was silent even though it knew or should have known of the Wang litigation, of JEDEC's rules, and despite knowing that JEDEC, its members, and those attending JEDEC meetings were relying on Rambus to affirmatively disclose its patents and applications consistent with JEDEC's policy and rules.
114. Indeed, Rambus' 1993 disclosure of the '703 Patent suggested to JEDEC members and participants that Rambus was disclosing all of its patents and pending patents that could be pertinent, and was not misleading JEDEC members and participants about Rambus' intention to assert other potential patent rights against products made to the JEDEC standards which were being developed, including the SDRAM interface technology.
115. By at least 1995, Rambus knew or should have known that, because of its silence when it had a duty to speak at the JEDEC meetings, if patents issued from its then-pending patent applications, Rambus would not be in a position to assert those patents against products implementing the proposed JEDEC standards. Thus, on September 11, 1995, Rambus stated to JEDEC members and participants: At this time, Rambus elects to not make a specific comment on our intellectual property position relative to the Synclink proposal. Our presence or silence at committee meetings does not constitute an endorsement of any proposal under the committee's consideration nor does it make any statement regarding potential infringement of Rambus intellectual property.
116. Rambus' September 11, 1995 statement did not comply with JEDEC's rules requiring affirmative disclosure of patent applications.
117. In November 1995, the Federal Trade Commission (the "FTC") and Dell Computer Corporation ("Dell") published in the Federal Register a proposed settlement, in the form of a proposed Consent Decree, of an antitrust investigation by the FTC of Dell under Section 5 of the FTC Act. The FTC had investigated Dell's failure to disclose a patent to a standard-setting organization akin to JEDEC. See File No. 931-0097, 60 Fed. Reg. 57870 (Nov. 22, 1995). The proposed Consent Decree sought to prevent Dell from enforcing the patent that Dell had failed to disclose.
118. On May 20, 1996, the FTC formally issued an antitrust complaint against Dell, and at the same time published the final consent decree and order resolving the matter. The consent decree and order prohibited Dell from enforcing the patent it improperly failed to disclose. In re Dell Computer Corp., 121 F.T.C. 616, FTC LEXIS 291 (May 20, 1996).
119. One month after the announcement of the Dell consent decree, Rambus announced it was leaving JEDEC. Rambus made the announcement in a June 17, 1996 letter, stating:
Recently at JEDEC meetings the subject of Rambus patents has been raised. Rambus plans to continue to license its proprietary technology on terms that are consistent with the business plan of Rambus, and those terms may not be consistent with the terms set by standards bodies, including JEDEC.
The letter listed certain issued Rambus patents, but failed to disclose any information about pending applications in the Related Family or the Additional Patent Rights, other than a statement that "Rambus has also applied for a number of additional patents in order to protect Rambus technology."
Rambus' Abuse of the Information It Learned from JEDEC Meetings
120. Rambus' failure to disclose its pending patent applications was only the iceberg's tip of its misconduct in connection with the JEDEC standards-setting process. During JEDEC committee meetings, while Rambus remained silent about its patent applications, and its plan to file additional applications to attempt to cover the proposed standards, other JEDEC members and participants participated in good faith, and shared their technical information so that open industry standards could be developed.
121. Rambus took advantage of the information it learned from the participants at the JEDEC committee meetings, and from the proposed standards then under discussion. Rambus used that information to revise secretly its then-pending but undisclosed patent applications and/or to prepare related additional applications to cover the very technology and potential standards being discussed by other JEDEC participants.
122. By participating in the JEDEC standards development process without disclosing its pending patent applications covering synchronous DRAM interface technology, and by revising its applications and later filing related applications to attempt to make its later-issued patents cover products manufactured to be compatible with the JEDEC standard, Rambus intentionally misled JEDEC members into promulgating standards which, according to Rambus' allegations against Hitachi, is not the open standard the JEDEC members intended and believed it to be.
123. Rambus' subversion of JEDEC's rules misled JEDEC members and the rest of the industry into believing that products compatible with the open JEDEC standard for SDRAMs would not be subject to any undisclosed claim of proprietary rights or assertions of patent infringement by Rambus.
124. Hitachi and other firms in the industry spent millions of dollars in product development, testing, and marketing of SDRAM chips and other products compatible with what was thought to be open technology - technology that was to be free of patent suits seeking to enjoin that technology. Now Rambus claims, and seeks to enforce, patents that allegedly cover that open standard.
125. HSA, other JEDEC members, Hitachi, Ltd., and other manufacturers relied on Rambus' silence at JEDEC meetings and thus, continued to participate in the development of the JEDEC open standards, instead of exploring alternative standards.
Rambus' Market Power
126. Rambus' misconduct at JEDEC meetings, and its subsequent exploitation of the information it learned at those meetings, has given it monopoly power, or a dangerous probability of obtaining market power, in the relevant markets if products compatible with the JEDEC standard are subject to Rambus' proprietary control. If Rambus' patent claims otherwise have merit, Rambus will control the interface technology market for high-speed synchronous DRAM memory, as Rambus already controls the only significant architecture which competes with the "open" JEDEC interface standard.
127. If Rambus succeeds in asserting the Patents in Suit against products designed to be compatible with the open JEDEC standard, Rambus also will control the relevant markets for synchronous DRAM memory and Logic Chips, which cannot be made without reasonable access to a reliable synchronous DRAM interface technology. Indeed, if Rambus is to be believed, it has the market power to stop completely the production of all SDRAMs and Logic Chips except its RDRAMs and compatible Logic Chips.
128. Rambus thus has the market power, or a dangerous probability of obtaining the market power, to profitably raise its price and reduce output in each of the relevant markets: the market for synchronous DRAM interface technology; the market for SDRAMs; and the market for Logic Chips.
129. Reflecting its asserted power in the SDRAM and Logic Chip markets, Rambus has negotiated "technology license agreements" with chip manufacturers, including SDRAM manufacturers, such as Hitachi, Ltd. and Samsung, and chip set manufacturers, such as Intel, which set forth terms upon which the manufacturers may produce products using Rambus' patented and non-patented technology. Through these "technology license agreements" and other arrangements, Rambus has attempted to extend its purported monopoly on synchronous DRAM interface technology to the markets for SDRAM and Logic Chips.
Rambus' Improper Use of Lawsuits and the Press
130. Rambus filed a first lawsuit against Hitachi on January 18, 2000, one day after a public announcement that an alliance of industry participants had been formed to develop an alternative competitive synchronous DRAM interface technology. Rambus filed a second lawsuit against Hitachi on February 29, 2000, the same day two more recent Rambus patents issued, the '214 and '215 patents. The parties have stipulated to the consolidation of the two cases.
131. Rambus has used its lawsuits as a means of publicizing its assertion that products compatible with the JEDEC standards infringe Rambus' patents, making Rambus technology the dominant, if not sole, standard in the industry. Rambus not only announced on its website the fact that it has sued Hitachi in this case, but it also published there a complete copy of Rambus' first Complaint. Rambus publicly has stated that its intention in filing this action is to stop the importation, sale, manufacture, and use of Hitachi SDRAM products.
132. On March 23, 2000, Rambus issued a press release announcing that it was requesting the United States International Trade Commission (the "ITC") to conduct an investigation of the products of Hitachi, Ltd., and one of Hitachi's customers, Sega Enterprises, Ltd., pursuant to section 337 of the Tariff Act of 1930. Rambus apparently contends that Hitachi, Ltd. and Sega have unlawfully imported into the United States, and sold in the United States after importation, products covered by United States Patents Nos. 6,034,918 and 6,038,195, which Rambus reportedly owns.
133. In suing Hitachi the day after a competitive alliance was announced, in making public comments, in filing successive lawsuits, and in seeking to induce the ITC to initiate a proceeding against the products of Hitachi and its customers, Rambus has sent a signal to Rambus' competitors and customers that if Rambus has its way, there will be no competition in the technology market for synchronous DRAM interface technology or in the markets for SDRAM memory and Logic Chips.
134. Rambus' anticompetitive acts constitute a course of conduct designed to hurt competition in the SDRAM technology market, in the SDRAM market, and in the Logic Chip market, subjecting Rambus to antitrust liability under Section 2 of the Sherman Act, 15 U.S.C. õ 2.
The Damaging Success of Rambus' Illegal Campaign
135. Rambus' misconduct, the climate of fear created by the lawsuits, and by Rambus' public statements about the lawsuits and possible ITC proceedings, is costing Hitachi sales revenues and the confidence of customers, which will restrict future sales. Hitachi's customers who purchase SDRAMs have inquired about the Rambus lawsuits, asking if Hitachi will be able to deliver its products and questioning whether they could face liability from Rambus if they use the Hitachi products that now stand accused of patent infringement. Rambus' efforts to have the products of Hitachi's customers excluded from the United States is certain to increase that anxiety.
136. This lawsuit comes at a key time in the standard-setting competition between Rambus proprietary RDRAM architecture and the architecture promoted by competitive SDRAM technologies. Rambus has publicly stated that development of alternative technologies by licensees or prospective licensees is a major threat to Rambus' business. Rambus' anticompetitive actions are attempting to suppress industry acceptance of anything but Rambus proprietary technology, amid concerns that the alternatives might not be available in the face of potential patent infringement problems. The uncertainty created by Rambus over alternatives to its own technology poses the potential for raising the cost and reducing the likelihood of implementing competing designs.
137. Rambus' abuse of the JEDEC standard-setting process also serves to discourage participation in industry standards-setting procedures that otherwise would foster competition which would lower the cost of entering the SDRAM and Logic Chip markets by allowing manufacturers to engage in active competition in the products and product lines compatible with those standards. If Rambus' lawsuits are successful, Rambus will have succeeded in converting the JEDEC standards-setting process from a pro-competitive process to one that will serve anticompetitive ends.
138. If Rambus' patent rights cover JEDEC's SDRAM interface standards, Rambus' subversion of the industry standards-setting process will significantly increase the costs of competitors in the SDRAM and Logic Chip markets and will allow Rambus to charge supracompetitive and discriminatory prices for its synchronous DRAM interface technology. Rambus' conduct, if successful, will result in higher prices for manufacturers of SDRAMs, for manufacturers of Logic Chips, for OEMs, and for end users of the many products that include SDRAMs and Logic Chips. Rambus' conduct, if successful, will eliminate SDR SDRAMs and DDR DRAMs as the less expensive alternatives that they are now, and artificially render the now more expensive RDRAMs as the least cost alternative.
139. Manufacturers and users of SDRAMs and Logic Chips have been and will be injured if they must pay the monopoly profit royalty that Rambus is seeking to exact for access to a technology standard that should be an open standard, available for no royalty or at a far lower "reasonable" and "non-discriminatory" royalty rate in a competitive market.
140. The foregoing injuries described above are injuries of the type the antitrust laws were designed to prevent. As a result of Rambus' conduct, consumers of computers are faced with higher prices.
141. Hitachi, Ltd. and HSA were, and are, firms targeted by Rambus with Rambus' exclusionary conduct; that is, both Hitachi, Ltd. and HSA were, and are firms against which Rambus has directed its conduct. Hitachi, Ltd.'s and HSA's injuries arise directly out of the markets Rambus seeks to harm.
theregister.co.uk
-- Carl |
