Components | May 24, 2011

Tessera Technologies updates on legal action

Tessera Technologies provided a status update on certain ongoing legal actions and announced a new legal action by its wholly-owned subsidiary Invensas Corporation.
U.S. International Trade Commission's (ITC) Investigation No. 337-TA-630 ("DRAM ITC action").

The U.S. Court of Appeals for the Federal Circuit affirmed-in-part, and vacated-in-part, the ITC's final determination in the action brought by Tessera, Inc. against certain DRAM manufacturers, Investigation No. 337-TA-630 ("DRAM ITC action"). The Court of Appeals affirmed that U.S. Patent No. 5,663,106 was valid, infringed as to the accused μBGA products, but not infringed as to the accused wBGA products. The Court also affirmed that Tessera, Inc.'s patent rights were exhausted as to certain accused products purchased from Tessera, Inc. licensees.

Because the other two patents at issue, U.S. Patent No. 5,679,977 and U.S. Patent No. 6,133,627, expired before the appeal could be decided, the Court also vacated, at Tessera, Inc.'s request, the portion of the ITC's decision related to these two patents.

"Although we are somewhat disappointed in today's decision by the U.S. Court of Appeals, we do not believe it will have a material impact on our business," said Robert A. Young, president and chief executive officer, Tessera Technologies, Inc. "Under Tessera, Inc.'s historical Tessera Compliant Chip (TCC) program, licensed customers have access to a patent portfolio of approximately 250 patents, and a court's decision on a single patent, one which it found valid, does not alter each licensee's obligation to pay royalties. In addition, we have recently announced that our Invensas Corporation subsidiary's patent portfolio of approximately 280 patents and patent applications is available for licensing, and we are in discussions with multiple DRAM companies with respect to that portfolio.

"We will have an opportunity to appeal today's ruling and are continuing to review other avenues open to us to ensure we are fully compensated for use of our technology," concluded Young.

Tessera has 45 days to petition the panel and/or the full Court of Appeals for rehearing, and may petition the U.S. Supreme Court for a writ of certiorari within 90 days after entry of the judgment or any requests for rehearing are denied, whichever is later.

The respondents in the DRAM ITC action include Acer, Inc., Centon Electronics, Inc., Elpida Memory, Inc., Kingston Technology Co., Inc., Nanya Technology Corporation, Powerchip Semiconductor Corp., ProMOS Technologies Inc., Ramaxel Technology Ltd., and Smart Modular Technologies, Inc. The patents at issue are U.S. Patent No. 5,663,106, U.S. Patent No. 5,679,977 and U.S. Patent No. 6,133,627.

Patent Infringement Lawsuit against Renesas Electronics Corporation

On May 23, 2011, Invensas Corporation filed a complaint against Renesas Electronics Corporation in the United States District Court for Delaware, alleging infringement of U.S. Patents No. 6,825,554, 6,777,802, 6,566,167 and 6,396,140. To avoid confusion, please note that this patent infringement suit is different than the patent infringement lawsuit filed by Tessera, Inc. against Renesas on Oct. 1, 2010.

Breach of Contract Suit against UTAC-Taiwan

On April 25, 2011, Tessera, Inc.'s case in the United States District Court for the Northern District of California against UTAC (Taiwan) Corporation alleging breach of contract, breach of the covenant of good faith and fair dealing, and seeking declaratory relief was reassigned to Judge Edward J. Davila. Judge Davila was very recently confirmed to the U.S. District Court for the Northern District of California, and such reassignments commonly occur. The hearing on UTAC's motion to dismiss the complaint and a case management conference are scheduled for July 15, 2011.

Wireless ITC Action

On March 29, 2011, the U.S. Court of Appeals for the Federal Circuit denied the Respondents' ATI Technologies, Freescale Semiconductor, Inc., Qualcomm, Inc., Spansion, Inc., Spansion, LLC and STMicroelectronics N.V. petitions for rehearing.

Tessera, Inc.'s District Court cases against the respondents in the Wireless ITC Action remain stayed pending resolution of all appeals. The Respondents have until June 27, 2011, to petition the U.S. Supreme Court for a writ of certiorari. The parties intend to request that the case management conference before the District Court, currently scheduled for June 7, 2011, be rescheduled to on or after Nov. 8, 2011.
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