Qualcomm wins a trade secrets case
This is an interesting case. A "road map" is similar to one home builder getting documents from another that says "We will build new homes with 4 bedrooms, 2.5 baths, heated toilet seats and marble kitchen counters" then using the plans to come up with their own home plans to try and compete or even do a better job.
If Maxim got the Qualcom roadmap from their customers, then they might be able to sue their customers, but that sure isn't good for business!
Maxim obtained documents that contained a "road map" of Qualcomm's plans for new chips. Batchelder said e-mails sent among Maxim employees show that the company's engineers then used the information to design their own chips to compete with Qualcomm's.
signonsandiego.com
By Kathryn Balint
UNION-TRIBUNE STAFF WRITER
January 5, 2005
A federal judge yesterday sided with San Diego wireless technology giant Qualcomm when he issued a preliminary injunction against a northern California company that Qualcomm accused of using its secrets to make competing computer chips for cell phones.
U.S. District Court Judge Rudi Brewster said evidence in the case shows that Maxim Integrated Products of Sunnyvale had misappropriated trade secrets contained in a confidential document that outlined Qualcomm's ideas for new cell phone chips.
Qualcomm's patented technology is the basis of cell phones used by 227 million customers worldwide. It holds 1,341 patents and has 2,048 patents pending related to cell phones and receives royalties from companies that use its technology. Qualcomm also makes chips that operate cell phones.
In its lawsuit, Qualcomm accused Maxim, a manufacturer of integrated circuits, of illegally obtaining Qualcomm's trade secrets from cell phone makers that are licensed to use its technology.
Maxim countersued, accusing Qualcomm of violating antitrust laws in an attempt to stifle competition.
In yesterday's court hearing, Qualcomm attorney James Batchelder told the judge that Maxim obtained documents that contained a "road map" of Qualcomm's plans for new chips. Batchelder said e-mails sent among Maxim employees show that the company's engineers then used the information to design their own chips to compete with Qualcomm's.
After four years of designing two new chips, Maxim said it is on verge of bringing them to market.
Maxim attorney Chad Campbell said the company doesn't know how it got the confidential documents. He argued, however, that the information wasn't a secret. One test procedure included in the documents, he said, is posted on the Internet.
Even so, Campbell said Maxim engineers never used the information contained in the documents to design their own chips. He said the chips in question had been designed long before Maxim received the Qualcomm documents.
In his ruling, Brewster said the evidence shows Maxim's actions to be "predatory, wrongful and a violation of misappropriation laws."
The judge asked attorneys for Qualcomm to write the injunction with input from Maxim's attorneys. Brewster said he will decide any disputes in the wording of the document.
In general, the injunction will prohibit Maxim from receiving, using or disclosing Qualcomm's trade secrets. It will also require Maxim to inform its customers about the injunction.
After the hearing, attorneys for Qualcomm and Maxim disagreed on whether it will ban Maxim from selling the two chips that Qualcomm claims were developed using the trade secrets.
The public was initially barred from yesterday's court hearing. But Brewster rescinded that order after Guylyn Cummins, an attorney for the Copley Press, publisher of The San Diego Union-Tribune, argued for an open hearing. In a motion filed with the court, Cummins said the public has a right of access to judicial proceedings.
"The right of the public to the free flow of information about the administration of its judicial system is crucial to a democratic society," the motion said.
Kathryn Balint: (619) 293-2848; kathryn.balint@uniontrib.com |
