Rambus Shares Rise Amid Analyst's Upbeat Comments on Infineon Trial
By Kaja Whitehouse Dow Jones Newswires
NEW YORK -- Volatile shares of Rambus Inc. rose Thursday, as a page in its trial against Infineon Technologies Inc. may have turned in its favor.
Morgan Stanley analyst Mark Edelstone said Thursday that his review of the trial suggests Rambus may have a stronger case than expected.
Last year, Rambus filed suit against Germany's Infineon (IFX), claiming Infineon violated its patents on dynamic random-access memory, or DRAM, semiconductor connection systems. The technology is used to increase the speed of computers.
Mr. Edelstone said new documents brought into the case, as well as U.S. District Judge Robert E. Payne's decision to delay the start of the jury trial in Richmond, Va., are two factors that might work in Rambus' favor.
Documents recently admitted into the trial, including an Infineon internal memo, suggest that "Infineon's DRAM design uses intellectual property patented in Rambus' DRAM architecture," Mr. Edelstone said.
Mr. Edelstone said he thinks the judge's extension of the trial favors Rambus because Judge Payne ordered Infineon to perform a thorough search of all its employees' files and ensure no files, including those on computer, are erased or destroyed.
"Based on the new evidence, we believe that the potential for Infineon to want to settle out of court has increased significantly," he said.
A Rambus spokeswoman said the company didn't issue any news Thursday and can't explain the stock's rise.
Infineon officials weren't immediately available for comment.
Rambus' stock has been volatile since the case hit the courts. Shares plunged last week, falling to a 52-week low of $15.67 on March 16, when Judge Payne ruled against Rambus claiming blanket rights to semiconductor systems that might be considered generic. Investors feared Judge Payne's ruling undermined Rambus' case.
Rambus conceded that Judge Payne's ruling might affect one of the patents involved in the lawsuit, but said it doesn't have any bearing on other patents in the case.
In midday trading Thursday on the Nasdaq Stock Market, Rambus (RMBS) was up $3.21, or 19%, to $20.50 on volume of 6.7 million shares, compared with daily average volume of 3.9 million shares. Earlier Thursday, the stock traded as high as $20.71.
Write to Kaja Whitehouse at kaja.whitehouse.dowjones.com
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