Intel may owe a lot of money to a semiconductor company that hasn’t existed for 20 years. A Texas jury asked Intel to pay $ 2.18 billion for infringing two patents owned by VLSI Technology, according to Bloomberg.
VLSI apparently rose from the dead in 2019 specifically to prosecute. The last time it was a company was in 1999, when Philips bought the semiconductor design company for $ 1 billion, with its assets later traveling to the Philips NXP spinoff (which you can know from its tap-to NFC chips) -pay, among other things). NXP will also receive part of the money from Intel.
One of VLSI’s claims to fame was to be part of the original project with Apple and Acorn to produce the first ARM processors – and the ARM company – responsible for the base of the chips that now appear on all smartphones, on most tablets and on an increasing number of laptops and servers.
Technically, patents are more recent than all of that VLSI story. They were originally issued to Freescale Semiconductor and Sigmatel in 2009, 2010 and 2012, respectively, and the first one was introduced in 2005. But Bloomberg reports that everyone was assigned to the new VLSI in 2019, an LLC linked to a Fortress Investment Group.
Calling VLSI as a zombie brand was part of Intel’s argument, according to Bloomberg:
VLSI “took two patents that had not been used for 10 years and said, ‘We would like $ 2 billion,’” Lee told the jury. The “outrageous” demand of the VLSI “would overwhelm true innovators”.
But that did not stop jurors from granting about a tenth of Intel’s annual profits – $ 2.18 billion – for infringing two of the three patents. (They are about “managing clock speed on an electronic device”, a “minimum memory operating voltage technique” and “scaling memory size based on voltage”, if you’re curious.)
Intel says The Verge who is not yet finished: “Intel strongly disagrees with today’s jury verdict. We intend to appeal and we are confident that we will prevail ”.
Fortress and VLSI Technology also have other lawsuits pending against Intel.