US condemns Intel to pay a fine for violating 2 VLSI technology patents

A federal jury in Texas has sentenced Intel Corporation to pay a $ 2.18 billion fine for damages caused by violating a Freescale patent and a SigmaTel patent. Both patents are related to VLSI technology, but Intel is appealing the ruling.

Intel will appeal the sentence handed down by the federal jury in Texas, whereby it would face a fine of more than 2 billion dollars for damages derived from a patent infringement. The parties involved are Freescale Semiconductor Inc and SigmaTel, the latter being taken over by the former in 2015. If Intel does not win on appeal, it faces a huge financial problem.

Intel is fined more than $ 2 billion, will it win on appeal?

The conflict originated years ago, when Freescale Semiconductor and SigmaTel filed patents related to clock frequency control and the minimum memory operating voltage technique. These patents were registered in 2012 and 2010 by Freescale Semiconductor and SigmaTel, respectively.

In 2015, Freescale bought SigmaTel, and one of the peculiarities of buying an entire company is that you acquire EVERYTHING, including intellectual property. Therefore, Freescale acquired all the patents and merged with NXP Semiconductors, a Philips spin-off company that was the fifth-largest semiconductor supplier in 2016.

The 2 patents at issue were transferred to VLSI (Very Large Scale Integration ) technology, which would have been “resurrected” to only orchestrate a legal battle against Intel. And it is that this technology is a process by which an integrated circuit is created that is made up of millions of transistors. It is a technology that is used to manufacture millions of components simultaneously interconnected in a compact, reliable, and economical die.

The advantage offered by the VLSI is its size, ideal for televisions, laptops, telephones, etc. On the other hand, it facilitates a lower consumption of the chip, which is ideal for the aforementioned products. So, this patent would have been used by Intel.

The lawsuit for NXP was filed in the Texas Courts, the Texas federal jury passes judgment condemning Intel to pay $ 2.18 billion in damages caused by infringing 2 patents:

• 1.5 billion from a patent.
• 675 million from the other patent.

According to Tom's Hardware, Intel is going to appeal the sentence and made these statements:

Intel disagrees with today's jury verdict. We intend to appeal and we are confident that we will prevail.

What will happen? Many times, when an appeal is made, the sentence is temporarily suspended until a new pronouncement. In other words, Intel will not pay this fine until the Court of Appeal ratifies the ruling unless it agrees.

When will we know the ruling on appeal? It may take years for us to see a new pronouncement on the case. Meanwhile, it is worth mentioning that many times companies reach out-of-court agreements that are usually characterized by lower economic agreements than those that are seen in the process. Do not rule out that Intel reaches an agreement with NXP.

With Intel's financial report in hand, the company posted a net income of $ 5.9 billion in the last four months of 2020. Therefore, we are sure that this fine would not be a caress for the chipmaker.