Intel and Via Technologies have reached a settlement that resolves all pending patent infringement lawsuits between the companies relating to chipsets and microprocessors.
The chip makers had been fighting 11 legal battles in five countries that involved 27 patents. As part of the settlement they will enter a 10-year patent cross-license agreement covering each company's products and will dismiss their pending legal claims in all jurisdictions, according to a joint statement. Specific financial details of the settlement were not disclosed.
The agreement required Via to pay royalties to Intel for building certain products, although the companies were not disclosing which ones, Intel spokesman, Chuck Mulloy, said. The settlement agreement did not apply to S3 Graphics, a company partly owned by Via.
"The good news is that it frees Intel and Via to focus on technology issues and stop investing substantial amounts in litigation," principal analyst at Insight64, Nathan Brookwood, said. "Litigation is a bigger drain on Via than Intel."
The settlement would also foster competition in the industry by allowing Via to participate in the core processor market, he said.
Though the settlement would make the chipset and microprocessor markets more competitive, it would have very little effect on individual end users, he said.
"Intel sells chipsets for roughly $US20, Via for $US10 to $US15, so cost savings on an individual basis really is small," Brookwood said.
Intel filed a patent infringement lawsuit against Via in September 2001 in the US District Court, District of Delaware, alleging that the Taiwanese company's P4X266 and P4M266 chipsets violated five patents related to chipsets for Intel's Pentium 4 processor. Santa Clara, California-based Intel sought injunctive relief and unspecified damages.
Via and its subsidiary company Centaur Technology countersued Intel a few days later, alleging its Pentium 4 chips infringed a patent jointly held by Via and Centaur. Via sought monetary damages and asked to block the sale of Intel's Pentium 4.
For Intel, the settlement would "remove legal clouds that had come over its chipset offerings for the Pentium 4 family," Brookwood said.
As part of Monday's settlement, Intel will grant Via a license to sell microprocessors that were compatible with the x86 instruction set at the heart of Intel's chips, but not those that were pin-compatible or bus-compatible with Intel microprocessors.
In addition, Intel agreed that for three years it wouldnot assert its patents on Via's pin-compatible and bus-compatible microprocessors. It also granted Via a four-year license to design and sell chipsets that were compatible with Intel's microprocessor bus and said that, for an additional year, it would not assert its patents on Via, its customers or its distributors over such chipsets.