Suit, countersuit: Nvidia takes Intel to court

Jake Widman
Saturday, 28 March 2009 01:26

IT Industry - Strategy

Nvidia has taken the next step in its spat with Intel, filing a countersuit alleging breach of contract and seeking to end Intel's license to Nvidia patents.

The two chipmakers are at odds over the terms of a cross-licensing agreement they entered into in 2004. That agreement permitted Nvidia to produce chipsets compatible with Intel products, and gave Intel access to Nvidia's 3D and other graphics processing patents.

In February of this year, however, Intel filed a lawsuit claiming that the licensing agreement doesn't cover Intel's chips with integrated memory controllers, such as the Nehalem chip. If so, Nvidia would be barred from manufaturing products that work with Nehalem. Nvidia, for its part, claims that the original agreement does extend to Nehalem and other future Intel chips.

In its countersuit, Nvidia alleges that Intel has "manufactured this licensing dispute as part of a calculated strategy to eliminate Nvidia as a competitive threat," using the allegations to "steer customers away from Nvidia."

In a statement, Nvidia president and CEO Jen-Hsun Huang said, "NVIDIA did not initiate this legal dispute. But we must defend ourselves and the rights we negotiated for when we provided Intel access to our valuable patents. Intel's actions are intended to block us from making use of the very license rights that they agreed to provide."

The suit asks the court to declare that the licensing agreement applies to the Nehalm chip; enjoin Intel from claiming there's a dispute; and permit Nvidia to terminate Intel's rights to Nvidia's patents.