Zeev:
Even McComas admits being shot by "bullet mixed in with the blanks". It shouldn't be long before the legal bloodshead is over.
john
electronicnews.com
DRAM Face-Off: Rambus’ Countersuit Could Cripple PC Market
Paul Kallender and Steven Fyffe
Sep 12, 2000 --- Rambus Inc. is endangering the entire U.S. computer industry with its legal counterstrike against Hyundai Electronics Industries Co. Ltd. filed with the U.S. International Trade Commission (ITC), according to Bert McComas, principal analyst at InQuest.
Hyundai and Micron Technology Inc. fired off separate legal attacks against Rambus late last month, seeking to overturn the Mountain View, Calif.-based IP house’s claims to widely used synchronous DRAM (SDRAM) and double data rate (DDR) DRAM technology.
Meanwhile, Rambus announced a new licensing deal with NEC Corp. late Tuesday covering SDRAM, DDR and next-generation RDRAM.
Rambus fired back on Monday, lodging a complaint against Hyundai with the ITC, alleging Hyundai had “engaged in unfair acts ... through unlicensed importation … and sale” of SDRAM and DDR.
If the ITC upholds the claim and Hyundai is barred from selling SDRAM and DDR in the U.S., the entire U.S. PC market would suffer, McComas said.
“The ripple effect is horrific,” he said. “What happens if you shut down the second largest Korean electronics firm and stop it from importing its highest revenue product on which all U.S. manufacturers are dependant? You shut down 15 percent of the DRAM supply coming into the U.S., and all the DRAM goes to Taiwan. The price of DRAM plummets in the rest of the world and in the U.S. it goes through the roof. It could turn out to be a messy thing.”
Rambus has also filed lawsuits against Micron and Hyundai in France and Germany.
“Basically, they’re just shooting bullets,” McComas said. “But they might have a real bullet mixed in with the blanks.”
Hyundai put on a brave face in spite of the threat of being shut out of the lucrative U.S. market.
“We’re not going to back down from our original filing. It can only be my assumption that this is retaliation to our filing,” said Jerold Olson, director of corporate affairs at Hyundai Electronics America, referring to the Korean memory maker’s Aug. 29 suit against Rambus.
“The research, the maneuvering and the filings probably started the moment Micron filed … We continue to believe that their patents are unenforceable and invalid,” Olsen told Electronic News Online.
Meanwhile, Micron’s response was, officially at least, the coolest thing about the company, which launched its own hotheaded suit against Rambus, August 28.
“For us at Micron, it’s business as usual … we’re just moving forward,” a Micron spokesman said.
While all the companies thumb through notebooks and legal teams tote up the fees for a legal saga now stretching across the Atlantic, observers say Rambus’ move may be every bit as aggressive as Micron’s. Firstly, as predicted by some lawyers who spoke to Electronic News Online two weeks ago, Rambus has chosen not to answer Micron and Hyundai’s suits, but to launch its own.
Overall, taking the fight to European courts may be a way for the IP company to re-seize the initiative, said Chaz De La Garza, a partner with the law firm of Fulbright & Jaworski in Austin. Moving to Europe could certainly speed up proceedings, as German courts in particular require far less discovery than their U.S. counterparts. Similarly, the ITC has a statutory period after which cases must come to trial and has a reputation for working fast, De La Garza said.
While Micron may want to grind both Rambus and itself through a long-drawn out discovery process in a U.S. District Court in Delaware in a suit based on Micron’s terms, Rambus can re-launch the offensive in Europe and get to trial first and at the very least distract Micron’s strategy, he said.
“If they can get to trial first, it puts pressure on Micron [and Hyundai],” De La Garza said.
Moreover, curtailed discovery process works to the significant disadvantage for the defendant in patent cases, said Marc E. Brown, a partner at Los Angeles-based Oppenheimer, Wolff & Donnelly LLP.
As far as Hyundai is concerned, Rambus is trying to avoid at all costs a fight with Micron on its home turf, choosing instead to attack the U.S.-based company in the European courts, Hyundai’s Olson said. But Rambus thinks it has the home-court advantage over Korean-based Hyundai, he said.
“The interesting point is there’s been no U.S. retaliation against Micron--(Rambus) haven’t counter-sued here,” he said.
The Korean company takes the threat of being shut out of the U.S. market very seriously, he added.
“We are concerned, but we don’t believe that it will happen,” Olsen said. “If the ITC upheld their filing, then we would be blocked from selling SDRAM and DDR in the U.S. That would be something we wish to avoid.”
While the three companies stand toe-to-toe waving legal sticks at each other, Hyundai and Micron’s responses resonate with a deepening resentment against Rambus by memory makers, said Brian Matas, vice president of market research at IC Insights, Scottsdale, Ariz.
Matas, a DRAM analyst at the firm, said Micron and Hyundai have decided to take a stand against what they believe is Rambus’ increasingly unreasonable encroachment on open DRAM technologies.
Eighteen months ago, Rambus, basking in the security of Intel’s apparent promise that only RDRAM memory would be deployed on its Pentium 4 (P4), could look forward to a potentially huge revenue stream. However, the present fight, if not its form, has been predictable ever since Intel slowly began to back away from that RDRAM commitment to the P4, said Matas.
By allowing DDR memory to ride the Pentium rollout, Rambus’ payday on RDRAM royalties looked to be withering on the vine as memory makers look to DDR for mid-range PC memories, leaving Rambus little choice but to “scrabble” to secure a lock on IP revenue from DDR and SRAM, Matas said. And that’s something memory makers feel they cannot afford to pay Rambus for, he added.
“There is really going to be a big battle,” he said. |
