OPTi Inc. CEO beat Intel and Apple. Who’s next?San Francisco Business Times - by Patrick Hoge
Media
Don’t call OPTi Inc. CEO Bernie Marren a “patent troll.”
True, Palo Alto-based OPTi, which won a $21.7 million patent infringement award against Apple Inc. last week, only has three employees, doesn’t make any products and exists only to license technology and pursue patent litigation against Advanced Micro Devices Inc., Nvidia Corp., Apple and others.
“A ‘patent troll’ buys patents and then sues people. We don’t do that,” said Marren, an electrical engineer and well-known semiconductor industry veteran who has started and run numerous successful companies over a period of five decades. “They’re all our inventions. We don’t sue on other people’s inventions.”
OPTi, indeed, was once a hot, 235-person computer chip manufacturer with nearly $164 million in annual sales.
But when Marren took over as CEO in 1998, its sales had almost disappeared, crushed by competition from Intel Corp., which was aggressively going after the core-logic chipset market that was OPTi’s bread and butter. OPTi, which went public with flair in 1993, by 2000 had revenue of zero.
In response, Marren shifted OPTi’s strategy to protecting its existing patents, which appeared to be in widespread, unlicensed use. Since then, OPTi has won tens of millions of dollars in settlements and judgments.
“I’m a very competitive person. If you end up with a big pile of lemons, you make lemonade,” Marren said in an interview. “We looked around and asked, ‘What do we have? How do we compete?’”
First target: Santa Clara-based Intel. In 2001, Intel settled out of court with OPTi, paying $13.5 million for the right to the patents in question.
Since then, OPTi has repeatedly gone after Santa Clara-based Nvidia, winning $14.75 million in settlements and judgments, with potentially more litigation still pending over alleged continued patent violations. An Nvidia spokesman confirmed the dispute but declined to comment in detail.
OPTi has also filed suit and settled with Atmel Corp., Broadcom Corp., Renesas Technology America Inc., Silicon Storage Technology Inc., STMicroelectronics, SMSC and VIA Technologies Inc., winning millions in lump payments from some and ongoing licensing agreements from others.
And on Dec. 3, a federal judge in Texas upheld a jury’s $19 million judgment against Cupertino-based Apple for willfully violating three OPTi patents covering “Predictive Snooping of Cache Memory for Master-Initiated Accesses,” and tacked on $2.7 million in interest. Apple, which has already appealed the case, declined to comment.
Meanwhile, what Marren says will be OPTi’s biggest case to date, filed in 2006 against Advanced Micro Devices, is scheduled to go to trial in February. An AMD spokesman told the San Francisco Business Times that the Sunnyvale-based company expects to prevail.
Marren said he was thrilled that Intel agreed last month to pay AMD $1.25 billion to settle a dispute over alleged unfair business practices.
“Now they can’t claim they don’t have money to pay us,” he said.
Since Marren assumed control of OPTi in 1998, he estimates the company has returned $100 million to shareholders in legal awards, dividends and through share repurchases.
In 2003, he and company CFO Michael Mazzoni agreed to take reduced compensation in exchange for getting a set percentage of legal awards, splitting 5 percent for the first $25 million and declining to 1 percent over time.
For Marren, who among other things was director of U.S. marketing and sales at Fairchild Semiconductor, CEO of American Microsystems Inc., founder of Western Micro Technology Inc., founder of Innocomm Wireless and the first president of the Semiconductor Industry Association, the role of licensor and litigator has proved to be exciting and interesting.
“You certainly (need) to have technical expertise to understand how to do this,” Marren said. “It’s a stimulating career. We certainly think we’ve tried to do an excellent job for our stockholders.”
Marren, meanwhile, is still making semiconductors, not just legal trouble for others. This year he started Linear Silicon Solutions Inc., a San Diego producer of semiconductors, his fourth startup. And he sits on the board of two publicly traded technology companies in Texas.
“He’s one of the few guys out in Silicon Valley who’s been there, done that, and continues to be a part of it,” said Reed Killion, president and CEO of UniPixel Inc., a small, 4-year-old optical display company near Houston for which Marren is chairman of the board.
“His history and expertise I don’t think could be replaced.” |
