Summary of Court Cases

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Summary of Court Cases - Updated 08/18/2010

Below is a summary of Rambus' multiple court cases. Latest status of active cases is highlighted in red. If you are already aware of the many court venues, simply read the red to stay up-to-date.

Some of the abbreviations used: SC=Supreme Court, CAFC=Court of Appeals for the Federal Circuit, HJW=Honorable Judge Whyte, HJR=Honorable Judge Robinson, HJK=Honorable Judge Kramer, JEDEC=Joint Electron Device Engineering Councils, FTC=Federal Trade Commission, ITC=International Trade Commission

VIRGINIA

Virginia 1 (VA1)

On August 8, 2000 Rambus sued Infineon for infringement on their SDRAM & DDR patents. It was assigned to Judge Robert Payne. Infineon launched a counter-claim against RMBS claiming fraud on Rambus’ part. In May 2001 Judge Payne threw out all of Rambus’ infringement claims based on his view of the patents and patent law. Shortly thereafter a jury in the same court sided with Infineon and found Rambus guilty of fraud for not disclosing their patent information at the JEDEC standard setting meetings. The result was that Rambus patents were found completely unenforceable. Rambus appealed to the CAFC (US Court of Appeals for the Federal Circuit).

CAFC Review of VA1

On January 29, 2003 the CAFC, under Judge Rader, overturned the fraud verdict saying that Infineon had shown no evidence of fraud and that the jury had erred, and remanded (sent back) the infringement trial to Judge Payne in Virginia, saying that his view of the patents and patent law in every respect were not properly constructed, gave reasons why, and said the trial should be completely re-done.

Virginia 2 (VA2)

In early 2004 Judge Payne began the remanded trial of Rambus vs. Infineon. He began to pursue a path claiming that Rambus had spoliated (destroyed) documents that could have proven Infineon’s case. In an oral ruling, Payne ruled that Rambus had spoliated evidence, for which dismissal of the infringement claims was an appropriate sanction.

Rambus, fearing that such a written decision with findings of fact and conclusions of law by Judge Payne on spoliation (for which an appeal would add another year or two or more) would be a tool used by Hynix and Micron in their respective suits, on May 21, 2005 settled with Infineon for an extremely, extremely low royalty rate. This precluded a written verdict from Judge Payne and the potential for collateral estoppel (where this judgment is used as a precedent in other court proceedings). Since the settlement ended the trial without an actual legal verdict, it could not be used elsewhere.

Virginia (Samsung)

On June 7, 2005, one day after Rambus brought a patent infringement suit against Samsung in California, Samsung brought suit against Rambus in Virginia. It asked for a judgment against Rambus based upon collateral estoppel of the spoliation that was found in the Infineon case, and that Rambus’ claims of Samsung infringement should be nullified for the four patents that were involved in the Infineon suit.

Samsung requested a summary judgment (quick Judge’s bench decision) on these issues. In November, 2005, Rambus agreed not to sue for any of the four patents being litigated, thus making this entire proceeding moot. Samsung also had sued to be reimbursed for attorney’s fees. Rambus agreed to pay these fees and made the money available for pickup at their offices.

This then became an issue (with Rambus agreeing not to sue and offering to pay the attorney’s fees) of whether there was an actual court case such that Judge Payne needed to rule in a written decision, or was there no issue and the entire proceeding was moot.

Judge Payne declared this an exceptional case and put out a written document in which he declared Rambus guilty of spoliation. This then became as issue as to whether this ruling could be used under collateral estoppel in the cases in other jurisdictions.

CAFC Review of Virginia (Samsung)

Rambus appealed Judge Payne’s written findings of spoliation from the Virginia Samsung case. In a most unusual case of legal posturing, Rambus recommended to the CAFC (Judge Rader) that their own appeal be denied because Judge Payne’s declaration has no legal standing since it did not have jurisdiction for a case that no longer existed. This case was argued in August, 2007. After a long delay, on April 29,2008, Judge Rader ruled that Judge Payne indeed did not have jurisdiction, and that the case be remanded (returned) back to the Virginia court with instructions to dismiss it. He also added that the written findings by Judge Payne could only be advisory in nature, and since they too were written without proper jurisdiction, they are ruled completely vacated. Judge Payne officially dismissed the case on June 3, 2008.

On July 28, 2008 Samsung filed a petition seeking review of the CAFC decision by the US Supreme Court. On October 6, 2008 the Supreme Court declined to review the decision putting a final end to the Judge Payne legal issues.

DELAWARE

Micron vs. Rambus

On August 28, 2000 Micron sued Rambus in Delaware, claiming Rambus’ patents are unenforceable due to antitrust and other issues. It was assigned to Judge Kent Jordan. After multiple delays years passed. Judge Jordan was promoted, and ultimately the case was reassigned to Judge Sue Robinson. Micron has invoked spoliation charges against Rambus, and Judge Robinson agreed to hear that first as a bench trial (she would rule without a jury) before moving on, if necessary, to the infringement trial, which would be held in front of a jury.

The spoliation trial began in November, 2007. The case received further written briefs in January through March, 2008, and a post trial oral argument was held on May 20, 2008. HJR then accepted further briefs between June and August, and then there were additional oral arguments on Sept. 19th.

On January 9, 2009, Judge Robinson ruled that Rambus was indeed guilty of spoliation, and that it was intentional, and hence Rambus cannot enforce a set of 12 specific patents against Micron. This ruling will end this case unless Rambus is able to overturn it on appeal. Micron and the other manufacturing companies then used this ruling in California asking Judge Whyte to dismiss their cases there based upon this ruling. Judge Robinson then, on February 9th, certified her findings and put a stay on Micron’s requests for attorney’s fees pending results of an appeal. Rambus filed an appeal to the CAFC on March 11th. On April 5th they heard oral arguments. On June 4th a re-hearing of the oral arguments was scheduled, to be held on October 6, 2010.

CALIFORNIA

DDR (Hynix vs Rambus)

On August 29, 2000 Hynix (then known as Hyundai) sued Rambus in San Jose, California, claiming Rambus’ patents are unenforceable due to prior art and other issues. This was assigned to Judge Ronald Whyte. In January, 2005, Judge Whyte ruled in a summary judgment (Judge’s ruling based on clear facts) that Hynix infringed on certain claims of Rambus, and that others should be brought in front of a jury.

Hynix then first attempted to invoke the spoliation issue and Judge Whyte allowed that to proceed in October, 2005. In January, 2006, Judge Whyte ruled that there was no spoliation by Rambus and the trial for infringement should continue.

In April, 2006, the jury found Hynix guilty of infringing on Rambus patents (including both DDR and apparently DDR2), voting 37-0 in Rambus’ favor on the required issues. The jury awarded $307 million to Rambus, which was later reduced to $137 million by Judge Whyte.

A third phase to this case, the “conduct phase,” addresses whether Rambus was guilty of misconduct that could cause the guilty infringement to be mitigated. The phase was delayed as Judge Whyte waited for certain activities to be completed by the FTC. During this period it was decided that this Phase 3 would apply not just to Hynix, but would also include Samsung, Micron and Nanya, in efforts to enhance judicial efficiency. It was also decided that Rambus may be allowed to use affirmative defenses (depending upon what issues surface during the trial), which would allow Rambus to use “self-defense” testimony, since the other companies were claiming Rambus tricked them at JEDEC (the standard setting organization) meetings, and Rambus wants to show the companies were colluding against them at the time. In addition, Rambus will be allowed to include newer technologies in these proceedings (such as DDR3 and GDDR4), so that there should not be a need to repeat these trials in the future for those technologies. Judge Whyte has also ruled that he will not allow any FTC findings to be admitted into the proceedings of these cases. Finally, in December, 2007, Samsung agreed that they would not be a party to the specific issues in Phase 3, but would abide by its rulings. They will have separate issues specific to them that will be litigated later within 6 months after the conclusion of this phase 3 trial – now scheduled for September 22, 2008.

The Phase 3 Conduct Phase of these proceedings began on January 29, 2008, and ended on March 26, 2008 when the jury returned a verdict saying that the defined technology markets existed, Rambus did indeed have a monopoly on those markets, but the monopoly was legal and Rambus was not guilty of fraud. This gave Rambus the victory in all three phases of this trial. On July 24th HJW issued a ruling denying Hynix’ request on multiple counts for a re-trial, stating that the results of the trial were fair and legally correct. Hynix then requested a hearing on a Supreme Court ruling saying that much of the damages (about 40%) were mitigated by the rule of patent exhaustion. That issue was heard on September 5th and rejected by HJW.

Following Sue Robinson’s spoliation ruling in Delaware in January 2009, Hynix requested that the results of these California trials be reviewed and overturned. HJW rejected this, implying that his decisions on spoliation are correct. Based upon the interactions between the parties resulting from the Delaware rulings, HJW certified the rulings from the three phases of the Hynix trials, sending both his spoliation ruling and that from Delaware to CAFC for resolution. Hynix filed an appeal to the CAFC and on April 5th they heard oral arguments. On June 9th a re-hearing of the oral arguments was scheduled, to be held on October 6, 2010.

On February 23, 2009 the Judge indicated that he found damages at 1% for SDR and 4.25% for DDRx flavors (USA only, including the Oregon plant). On May 26th Judge Whyte ruled that on appeal of the approximately $397 million judgment, Hynix must post a bond of $250 million and a lien on Korean properties valued to be at least double the remaining amount required. This bond was put in place on June 29, 2009.

On June 5, 2009 HJW was to hear arguments related to how much money Hynix owed Rambus for Rambus’ legal fees. However, he then decided that he did not need oral arguments on this issue and would rule based on the papers already filed. On March 8, 2010 Rambus was awarded about $765,000 in legal fees from Hynix.

Samsung Version of Phase 3 Trial

The Samsung version of the Phase 3 Rambus conduct trial began on September 22, 2008, and was a bench trial (no jury) under Judge Whyte. Closing arguments were presented on October 1st. This trial was also thought to be of some interest in the ATC case as it may have some influence on Samsung’s counterclaims in Judge Kramer’s court.

One of the key issues addressed was whether Samsung was entitled to the Infineon rates due to a “most favored rate” clause in their original contract, and if so, how long that rate would/should last. This part of the dispute centered on whether a fixed price contract could be compared against a variable production rate contract, as well as whether the wording of the contract survives the end date of the contract. Samsung claimed that Rambus acted in bad faith, and hence the contract remains in effect in perpetuity.

On April 27th the Judge ruled that Rambus was indeed limited to Infineon’s low rates due to their most favored nation contract clause, but it only applied for one quarter (the second quarter of 2005), and that this agreement between the companies should have no bearing on any pricing issues after that time.

DDR2 & Later Flavors (this lawsuit is designated 05-06)

Now that the three phases of the DDR trial have been completed, there will be a trial to determine whether DDR2 infringes RMBS patents. The possibility of treble damages exists if there is a finding of willful infringement. Since its initiation, this suit has been expanded to also cover DDR3, 4, GDDR2, 3 & 4. It is also possible that the completed trials may actually have rulings that include DDR2, in which case this will cover only DDR3 and later derivatives. This case is also RMBS versus Micron/Hynix/Samsung/Nanya.

This trial was originally expected to start on January 21, 2009. Markman rulings (describing the patent terminologies from a legal point of view) have been established by HJW.

HJW has proposed keeping the case consolidated for the infringement portion of the trial and possibly deconsolidating for the damages and willfulness portions of the trial (which could result in treble damages). The liability and damages trial will be before a jury, and HJW will handle the willfulness as a bench trial, starting within 10 days of the conclusion of the infringement trial.

On November 25, 2008 HJW ruled, in summary judgment, that the manufacturers infringed on one element of one patent, which makes them guilty of infringement going into the trial. He is leaving it to the jury to decide on all the other patent issues.

Following Judge Robinson’s Delaware ruling that certain Rambus patents were unenforceable, the memory makers all requested a stay of this trial pending the ultimate outcome of the Delaware decision. As a result, Judge Whyte has agreed to stay this trial indefinitely, awaiting the result of the CAFC review of both his and Judge Robinson’s spoliation rulings. On June 12, 2010, HJW gave indications that they might try to start the trial around May, 2011. It was finally agreed that the parties would meet the Friday after the CAFC decision is delivered in order to pick a trial time.

ATC Case in California (Price Fixing Joint Boycott Case)

In May, 2004, Rambus filed an Anti-Trust suit against Micron, Infineon, and Hynix in California, claiming collusion amongst these companies to drive Rambus out of business. In June, 2005 they added Samsung as a defendant in this case. This is a major case, and could subject the defendants to treble damages.

This case has been assigned to Judge Richard Kramer in San Francisco. Initial discovery has been completed. Trial was scheduled to start on March 16, 2009. Because of the complications resultant from the Delaware activities, HJK instead used the month of March to review a host of summary judgment requests from the memory managers, and and delayed the actual trial until September 28, 2009. It is expected to last 6 to 8 weeks.

The March summary judgment reviews were completed (there were eight to be ruled upon, all proposed by the memory cartel). Seven were dismissed , and an eighth was postponed awaiting rulings from Judge Whyte’s court.

The memory managers then asked for dismissal based upon the Delaware ruling, and briefs based upon spoliation were filed. On April 27 Judge Kramer gave his initial ruling that Delaware had no effect on this case, and that he would allow spoliation to be discussed from both parties viewpoints within the confines of this case. After further discussion of the spoliation issues on June 1st, the September 28th trial date continued to hold firm. At argument hearings on August 31st and September 2nd it was decided to hold off the trial start until January 11, 2010 due to an ill lawyer for Samsung. Then at that time a postponement was requested due to an ill lawyer from Micron. Then, at about the same time, on January 19th, Samsung settled all open issues with Rambus, and was removed from the case. Based upon this change, as well as the Micron lawyer illness, HJK requested further information to help him estimate the length of the trial.

He has been holding periodic sessions to better estimate the length of the trial and to resolve other open issues. On August 5, 2010 Judge Kramer indicated that he was proposing that he would work through all the pre-trial issues, and then hand the trial over to Judge James McBride for the actual trial. He estimated that the case would be ready for trial under Judge McBride by the third week of January, 2011. This was not cast in stone, and procedures and timings will continue to be worked out during August and September, 2010.

Nvidia

On July 10, 2008 Rambus filed suit against Nvidia for patent infringement, requesting a jury trial. The patents in the suit include Flexphase patents that could increase patent coverage until 2021. The case was initially assigned to Judge Joseph Spero. On August 8th, at Rambus’ request, the court agreed to reassign the case to a United States District Judge, for which Judge Susan Illston was chosen. On August 24th Rambus’ question to the court as to whether this case is related to the current cases in Judge Whyte’s court and should be assigned to the same judge was ruled not related enough to reassign to Judge Whyte. Nvidia requested of Judge Illston that the case be dismissed, which was denied on November 13th.

On December 5th, Nvidia filed to stay all patent infringement claims until conclusion of the ITC review, expected sometime in 2010. On December 30th Judge Illston declined to stay the action on the Farmwald-Horowitz patents while agreeing to stay the Barth/Ware issues until after the ITC issues a final decision, due on May 24, 2010. She has requested further discussions on this at a case management conference on March 12, 2010, which has since been delayed until June 18th 2010 and then to August 27th 2010 in agreement by both parties.

On January 16, 2009, Nvidia filed to have the case dismissed based upon the spoliation rulings and unenforceability of Rambus patents as ruled in Delaware by Judge Robinson. Judge Illston, on March 11, gave an indication that she would stay the trial until the appeal of the Delaware decision was resolved.

Given that the ITC issued its ruling for Rambus and against Nvidia on July 26, 2010, a ruling that included the Barth patents as well as exonerated Rambus of the spoliation charges, it is possible that Judge Illston will be ready to reopen the case for back damages by the fourth quarter of 2010. This remains to be seen.

NORTH CAROLINA

Nvidia

Nvidia has, in response a day later to Rambus’ infringement suit in California, sued Rambus in North Carolina claiming monopolistic practices by Rambus. On September 17, 2008, Rambus filed to have the case moved to the Northern District of California (the location of Judge Whyte’s court). On December 1st, the NC court agreed with Rambus that the case should be transferred to the Northern District of California, and instructed that it be done. On December 4th, Rambus requested that it be consolidated with the other Nvidia case already in California, and that was done. The formal granting of the consolidation of the two cases within California occurred on February 2, 2009.

FEDERAL

FTC

In November, 2000, it was reported that Micron and Hynix asked the Federal Trade Commission (FTC) to charge Rambus with anti-trust violations, and such investigation began officially in February, 2001. In June, 2002 the FTC decided to bring suit against Rambus based on antitrust violations. The FTC rejected Rambus’ request to include collusion evidence against the DRAM makers in the testimony to be gathered. In January, 2003, the FTC Complaint Counsel asked its Administrative Law Judge (ALJ) to skip trial and go directly to a default judgment against Rambus. The ALJ, however, began its own review, including a month long trial with dozens of witnesses.

In February, 2004, FTC Administrative Law Judge Stephen McGuire issued a 340 page document that completely exonerated Rambus of any wrongdoing on all three accounts with which they were charged. In April, 2004, the FTC Complaint Counsel filed an appeal of McGuire’s decisions, and renewed its own investigation.

In August, 2006, the FTC Commission, in spite of its own ALJ’s findings, ruled that Rambus unlawfully monopolized the memory markets. They stated they would work on determining the appropriate remedy.

In February, 2007, after pressure from Judge Whyte to reach conclusions, the FTC issued its remedy, which allowed Rambus to collect specific rates for various flavors of memory, and did not impact some of the newer forms of memory. While this was generally considered favorable for Rambus, the company was forced to appeal in order to remove any possible collateral estoppel effects from the negative aspects of the ruling.

Oral arguments on the appeal were held on February 14, 2008 before a panel of three judges, Henderson, Randolph & Williams. On April 22, 2008, the CADC overturned the FTC’s rulings, saying they were based upon "aggressive interpretation of weak evidence." They remanded the issue back to the FTC, but warned them about their "serious concerns about the sufficiency of the evidence" in the case.

On June 6, the FTC filed for an “en banc” review (appeal) in which they asked the CADC to reconsider their decision. The decision by CADC to deny the en banc appeal came down on August 26th, with no judge supporting a review.

On November 24th, the FTC filed a petition for certiorari with the U.S. Supreme Court seeking review of the case. On February 23, 2009 the Supreme Court declined to review the case, ending this specific effort by the FTC.

On May 14, 2009 the FTC announced that it was dismissing all remaining issues in the Rambus case, and the case is now to be considered fully closed.

International Trade Commission (ITC)

In early November, 2008 Rambus filed a complaint with the International Trade Commission seeking to bar the import of products from Nvidia Corporation for infringement upon Rambus’ patents. The ITC is expected to decide whether to initiate such an investigation within 30 days, and if they do they typically take 12 to 18 months to reach a decision. On December 4th they granted Rambus’ request for an investigation.

On January 5, 2009 the ITC, under Judge Theodore Essex, set a target date to complete this case of April 11, 2010, with a final initial determination due by December 11, 2009. The hearing was set for August 17, 2009 and expected to conclude by August 28th. However, in May it was agreed by all parties that it would take more time, and the hearing dates were moved out to August 31-September 11, with an initial determination by December 11, 2009, and with the target date for full resolution remaining April 11, 2010. Then in July the hearing dates were moved back to the original August 17-28 dates.

Following the Judge Robinson ruling in Delaware, Nvidia requested a stay pending the outcome of appeals related to the case and the conflict with California’s rulings. On February 24th the ITC denied the stay request, saying it is unclear when, if ever, that conflict will be resolved, and such a lengthy delay is uncalled for nor desirable.

In July, 2009, the August 17-28 hearing dates were officially delayed until October 13th to 20th. There were a series of pre-hearing activities throughout September in preparation. On October 15 it became known that the staff of the ITC recommended to Judge Essex that various Rambus patents were valid and infringed, recommending a ban of US imports. Such recommendations were not binding upon the judge. The Judge’s initial determination was released on January 22, 2010. He found that Nvidia is violating three Rambus patents (but not two others), which could result in a ban on imports of certain Nvidia chips and products that use them. The decision remains subject to review by the full ITC, and then is subject to review by the CAFC. A target date of May 24, 2010 had been set for concluding the investigation.

On May 24th It was postponed two more days, and then again postponed until July 26, 2010, in order to allow for June briefings by both sides on how the Rambus-Samsung settlement might effect this case.

On July 26, 2010 the ITC finally ruled, saying that Nvidia violated Rambus’ valid patents and issued an immediate order halting all imports into the USA of offending products. These included products sold by Hewlett Packard and others, and included the Barth patents with expiration dates in 2015. For 60 days Nvidia or its customers were required to post a bond equal to 2.65% of product value if they continued to import, while the decision awaited Presidential review, which needed to occur within 60 days. In order to avoid this issue, on August 13, 2010, Nvidia entered into a settlement with Rambus based upon the terms of the European Union Rambus agreement. This provides for given royalty percentages on most Nvidia products, but does leave some product areas still to be resolved through legal means or further negotiations, and does not address back damages, which will likely be handled in separate court actions under Judge Illston.

Reexamination of Several Rambus Patents at the USPTO

In 2007 Samsung filed for a patent reexamination of eight of Rambus’ patents. In December 2007 Rambus request to end the re-exam was denied.

The process is on-going and based upon history will continue for as long as several years (perhaps two to seven years), including appeals. Patents are assumed to be valid during the re-exam process. It is important to note that two of the Rambus patents (105, 918) have been found infringed and cannot be challenged by this same process (but can be challenged by the patent board themselves). In early July, 2008 the patent office rejected multiple Rambus claims. This is a normal first step in the multi-year process. Prior judicial rulings in other cases have ignored such activities by the patent office, and many believe it is likely HJW will follow these precedents.

On December 23rd the USPTO ruled that 24 claims on one of the Rambus patents were indeed valid, while several others were not. That ends the issue on the valid claims, and there are several levels of appeal for Rambus on the invalid judgments, which generally take several additional years to resolve. The ruling also raises some issues on the dates of expiration of the patent – possibly extending them from 2010 until 2021. Additionally, the validity of Rambus patents in the controller area appears to be clearer. The exact means for clarifying these issues is not well known at this time.

Additionally, in mid-February the USPTO ruled on several more patents, and in total 79 claims out of 139 have been found valid, findings which cannot be challenged any further. Rambus can continue to challenge to have the remaining 60 claims ultimately found valid.

Between December 8th and 19th, 2008 Nvidia also filed a host of requests for ex parte reexamination of many Rambus claims. The USPTO has followed their standard procedure of initially rejecting many of these patents pending further investigation – however the patents remain valid until the issues are resolved otherwise. The case remains active but on March 4, 2010 the patent office validated a collection of Rambus patents in a “final order”.

European Union (EU)

In July, 2007, the European Union raised objections against Rambus for abusing their dominant market position by claiming unreasonable royalties. On June 11, 2009, they reached a tentative agreement with Rambus, by which Rambus agreed to license their current and prior memory technologies and controller technologies for agreed upon rates for a period of five years after the offering date. The agreement would be forward looking only, and not release any companies from back damages. Future technologies such as DDR4 were specifically not included in the agreement.

On December 9, 2009 the European Union announced that the final settlement was reached with Rambus as per the guidelines mentioned above. Neither fines nor guilty findings were made by the EU, and the case was officially closed.



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