FTC opens case against Rambus

Tom Krazit, IDG News Service   Today’s Top Stories   or  Other Legislation/Regulation Stories  

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April 30, 2003 (IDG News Service) -- Lawyers for Rambus Inc. are once again in court as the Federal Trade Commission today opens its case against the memory designer on charges that it deceived a memory standards organization in order to profit from licensing fees.
Rambus has been involved in numerous lawsuits and trials over its participation in a standards-setting process for the next generation of PC memory. The Los Altos, Calif., company believes it's entitled to royalties on the sales of synchronous dynamic RAM (SDRAM) technology, the predominant memory technology used in PCs, because products based on that standard use patented Rambus technology.
The SDRAM vendors disagree, challenging the validity of Rambus' patents and accusing the company of trying to fraudulently influence the SDRAM standards process.
In the 1990s, Rambus sat down with a number of other memory and PC companies to design memory standards in conjunction with the Joint Electron Device Engineering Council (JEDEC). Rambus pulled out of the JEDEC meetings before a final agreement on the standard was reached, but it later sued memory vendors such as Hitachi Ltd. and Infineon Technologies AG that included the final SDRAM standard in memory chips, claiming those products infringed upon Rambus' patents.
The FTC charges that Rambus had a duty to disclose those patents to JEDEC before it entered into the standards-setting discussion. By failing to disclose those patents, Rambus sought to influence JEDEC into adopting its patented technology in the SDRAM standard, the FTC said when it filed its complaint last year (see story).
"Because standard-setting abuses can harm robust and efficiency-enhancing competition in high-tech markets, the commission will continue to pursue investigations in this important area," Timothy Munis, chairman of the FTC, said during a recent appearance before Congress.
Rambus argues that JEDEC's disclosure policies were poorly constructed and that the company can't be held liable for failing to disclose its patents when it was never clear whether the company had a duty to do so.
"The fact that Rambus' founders believed they had conceived the inventions in question was public information; the inventions were described in detail in publicly available patent documents that were discussed at JEDEC and that were closely scrutinized by JEDEC members. The evidence will show that Rambus made detailed disclosures of its technology prior to joining JEDEC to numerous companies in the industry," Rambus said in a statement Monday. Those companies included Sun Microsystems Inc., Intel Corp., Micron Technology Inc. and IBM, among others.
In a separate patent infringement case between Rambus and memory vendor Infineon Technologies AG, two of three judges on the U.S. Court of Appeals for the Federal Circuit agreed that JEDEC's disclosure policies were vague andoverturned fraud verdicts reached by a jury against Rambus.
Infineon is expected to appeal that decision to the U.S. Supreme Court.

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