Rambus Could Reap Millions In Patent Settlements

RedEaredSlider writes "Rambus, a designer of semiconductor chips, won a long-running patent battle with NVIDIA, but that dispute is not the only one the company is involved in — and the upcoming decisions could mean millions in additional revenue. Besides the NVIDIA decision, Rambus is involved in a suit with Hynix Semiconductor that will be heard in October. In that case, Hynix had originally sued Rambus in 2000, but Rambus counter-sued. Hynix lost, and appealed. The parties will appear before the US Court of Appeals for the Federal Circuit in October. A judgment in Rambus's favor would be worth at least $397 million, according to the company's general counsel, Tom Lavelle."

Re:To keep up

[ScrewMaster]

ATI is going to want to get sued in about six months for $500 million.

Maybe they'll make the mistake of suing IBM.

Re:Rambus...

[Anonymous Coward]

That's one side of the story. The others side was the other guys were the world's largest illegal cartel (according to the US DOJ) and were out to rip off Rambus.

Most slashtards only know about 1/10th of the story, because they are ugly help-desk nerds who only get their IT news from slashdot.

Re:Rambus...

[Nikker]

As someone who bought said ram as part of a Dell in 2003 I can attest I would like to give Rambus a collective kick in the nuts for doing this. At the time coated me approx $600CDN for the upgrade from pc233 I believe? For 512mb. 7 years later 512mb pc 1066 is still $200. The performance was actually pretty good though giving approx 4gb/s performance, which at the time was pretty good. But that coupled with a Prescott I truly understood the value of building your own.

Re:Rambus...

[meerling]

I know most people define patent trolls as never releasing real products, but I don't think it should be that strict. Any company that engages in significant patent lawsuits for cash settlements (not patent portfolio license exchanges) should be classed a patent troll. Obviously any company that doesn't produce product is automatically in that category, but there are others that should be as well. Rambus is one of them IMO.

Re:Rambus...

[RMH101]

I remember working 2nd line support for a company with a load of RAMBUS Dells. Caused a bit of a commotion when the usual upgrade-by-slapping-in-more-RAM option was costed. I can remember it costing more than a new Optiplex at the time. Much hilarity with management.

Re:Rambus...

[_avs_007]

In most standard bodies that I participate in, there is a clause in the member's agreement that says that anything you disclose/discuss to/with the committee, constitutes IP submission to the committee's patent pool of any IP associated with the topic in discussion. And there is usually a mandatory IP check before the spec is ratified. Any members that fail to declare IP that they wish not to license according to the member's license agreement, lose rights to said IP. I've seen a few cases where IP was later declared before the spec was ratified. In most cases, the company agrees to the licensing terms mandated in the member's agreement. In the once case I've seen where the member refused the licensing terms, their membership in the standard's body was revoked. (Basically they said, agree to the terms you agreed to in the member's agreement, or leave the standard's body. It was then pointed out if they left the standard's body, they would LOSE ALL RIGHTS to any patents that were submitted to the patent pool by other members, because the license agreement is only between the members)

Not sure how JEDEC works...

Re:Not quite

[Solandri]

Not quite... It was more like the council had a non-disclosure agreement, and Rambus showed them what they were working on, after which a couple of the other manufacturers turned around and blatantly copied the inventions. Unfortunately for them, the patents in question had been filed long before.

Which is why Rambus has been awarded compensation in several judgments.

Holy rewriting of history. Lemme quote the original FTC Commission report [ftc.gov] on the case (pdf):

JEDEC operated on a cooperative basis and required that its members participate in good faith. According to JEDEC policy and practice, members were expected to reveal the existence of patents and patent applications that later might be enforced against those practicing the JEDEC standards. In addition, JEDEC members were obligated to offer assurances to license patented technologies on RAND terms, before members voted to adopt a standard that would incorporate those technologies. The intent of JEDEC policy and practice was to prevent anticompetitive hold-up.

Rambus, however, chose to disregard JEDEC's policy and practice, as well as the duty to act in good faith. Instead, Rambus deceived the other JEDEC members. Rambus capitalized on JEDEC's policy and practice - and also on the expectations of the JEDEC members - in several ways. Rambus refused to disclose the existence of its patents and applications, which deprived JEDEC members of critical information as they worked to evaluate potential standards. Rambus took additional actions that misled members to believe that Rambus was not seeking patents that would cover implementations of the standards under consideration by JEDEC. Rambus also went a step further: through its participation in JEDEC, Rambus gained information about the pending standard, and then amended its patent applications to ensure that subsequently-issued patents would cover the ultimate standard. Through its successful strategy, Rambus was able to conceal its patents and patent applications until after the standards were adopted and the market was locked in. Only then did Rambus reveal its patents - through patent infringement lawsuits against JEDEC members who practiced the standard.

The Commission finds that Rambus violated Section 5 of the FTC Act by engaging in exclusionary conduct that contributed significantly to the acquisition of monopoly power in four relevant and related markets. We further find a sufficient causal link between Rambus's exclusionary conduct and JEDEC's adoption of the SDRAM and DDR-SDRAM standards (but not the subsequent DDR2-SDRAM standard). Questions remain, however, regarding how the Commission can best determine the appropriate remedy. Accordingly, the Commission orders additional briefing for further consideration of remedial issues.

Yes Rambus had some patents pending before they approached JEDEC. But the whole point of being a member of JEDEC was to disclose those patents and negotiate licenses for the patents before the technologies were codified as a standard. That way the other members could decide, with all information in hand, which memory technology they would make the standard. Rambus deliberately failed to do this and did not disclose what they were patenting, essentially tricking the others into creating a memory standard which incorporated their patented technology so they could later threaten them with patent infringement lawsuits. They event went so far as to take ideas other JEDEC members revealed with the understanding that it wouldn't be patented so everyone would be free to use it, and incorporated them into their own patents.

The reason Rambus "won" was because even though the FTC found that they violated JEDEC's policies, the courts still found that the patents were valid. Normally when you write a contract, you're supposed to include