Just back from my holiday, I see that events in the Intel Wars have not waited
for me to return since the previous installment (which could be titled "Intel
Wars: A New Hope"). Intel and DEC are still going to court over possible
infringement of DEC's patents by Intel's Pentium, Pentium with MMX, Pentium Pro,
and Pentium II processors.
As I reported earlier, Intel already seens to have made a first financial move
to hedge against any damage payments that they may be required to make; you'll
find more news about that below. I also outlined two possible ways for Intel to
strike back with a court case of their own to increase chances of a favourable
settlement: First option was to find a plausible countercharge against DEC, eg.
an Intel patent that DEC's Alpha might possibly be infringing on, and sue them
back over that. The other option was to slap together a quick charge against
DEC, with a low probability of success but a noticable "annoyance factor" and
It seems that Intel have now chosen the latter option. They are suing DEC over
"infringement of intellectual property rights" (not a particularly apt
description IMHO, but definitely one that serves their publicity goals better),
having announced this intention the day after the alleged infringement occurred.
Intel claims to have transferred confidential product information to DEC in the
past, and are now asking for that information to be returned to them. DEC have
apparently refused and in doing so, according to Intel, have violated their
contract with Intel.
No more details were given by Intel, but it's a reasonable guess that these
documents are related directly to Pentium microarchitecture and therefore to the
patents suit. The only particularly likely reason for Intel to suddenly demand
them back is that they contain evidence that Intel would like to withhold from
DEC and from the court. Thus there may actually be more involved than just
bartering material for a settlement on the multi-billion dollar patents suit:
Intel could be striking at DEC's supply lines, as it were.
So, does Intel have the right to demand these documents back? If so, does DEC
have the right to retain them? This would normally depend on the terms of the
contract, but there may be a loophole. If the documents contain evidence of
possible patent infringements by Intel, then depending on local law and court
approval, DEC may be able to subpoena the documents and hold them back for use
as evidence in court. This may override any existing contract, just like eg. an
NDA does not apply to covering up possibly illegal practices (Microsoft has long
been suspected of doing exactly this, but in that case intimidation was probably
more of a persuader than actual legal implications).
If DEC is indeed holding the documents under subpoena, this may well cover the
alleged contract violation leaving Intel without a case. As for the likelihood
of this scenario, DEC has hired a lawyer with impressive experience in patent
suits. He would certainly have advised DEC to return Intel's documents if they
were obliged to do so, or at least to stall rather than refusing outright like
DEC is said to have done.
Without more detailed information there is no way to be sure about this, so
we'll have to wait and see. DEC may be keeping these documents to prevent them
from being destroyed by Intel, but more probably this is just a matter of
convenience for them, eg. because they want to continue to study the documents
for their court case. Given Intel's past secrecy about certain details of
Pentium performance that could be related to DEC's patents, solid evidence may
be hard to come by.
The news about Intel's apparent hedge against losing the case isn't really new,
but something I failed to notice earlier: As I noted in my previous bulletin,
Intel suddenly reported lower-than-expected revenue, profit margin, and profits
for the second quarter, which if convicted could help them (1) bargain for lower
damage payments to DEC, and (2) save some extra pennies for that rainy day if it
should ever come. Based on the available information, I didn't think it was
very likely that Intel could really be expecting a drop in profits.
What I just found out is that Intel didn't think it was very likely either.
Intel's announcement predicting reduced revenue and increased expenses for the
second quarter comes just nine days after another announcement of an increase in
dividend payment to stockholders for the third quarter--quoting "solid financial
returns" and "faith in the future to increase our quarterly dividend"! Is Intel
trying to tell us they evaluated their disappointing sales figures a week
*after* deciding they were doing well enough to scatter a couple more billion
dollars to the four winds in the future?
; Jeroen T. Vermeulen \\"How are we doing?"// Yes, we use Amigas ;
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