Intel fined $948.8 million for VLSI violation • The Register

VLSI Technology, a patent holding company associated with Softbank’s Fortress Investment Group, has been awarded $948.8 million in a patent infringement lawsuit against Intel Corporation.

On Tuesday, a federal jury in the Western District of Texas, a popular spot for patent lawsuits, found Intel’s Cascade Lake and Skylake processors to infringe a VLSI computing patent.

Intel in an emailed statement The registry said it intends to appeal the decision.

“This case is just one example of many that shows that the US patent system urgently needs to be reformed,” said a company spokesman. “VLSI is a ‘patent troll’ created by Fortress, a hedge fund funded by large investment groups for the sole purpose of filing lawsuits to extort billions from American innovators like Intel.”

“This is the third time Intel has been forced to defend itself against baseless patent infringement lawsuits from VLSI. Intel strongly disagrees with the jury’s verdict and the award of excessive damages. We intend to appeal and believe in the strength of our case. “

An attorney representing VLSI did not immediately respond to a request for comment.

The registry asked Fortress Investment Group for comment, but we have not yet received a response.

The jury decision announced on Tuesday concerns US Patent No. 7,606,983, “Sequential ordering of transaction in digital systems with multiple requestors”.

Intel was ordered in March 2021 to pay $2.18 billion for infringing two VLSI chip patents – US Patents 7,523,373 and 7,725,759. The company applied for a new trial in this case, but it was denied. It doesn’t have to pay anyway: Last month, the US Patent and Trademark Office agreed to review the validity of the VLSI patents.

Just this week, the U.S. Court of Appeals for the Federal Circuit reinstated a previously denied VLSI patent claim that is now subject to reconsideration.

In April 2021, Intel prevailed in another patent case with VLSI.

In October 2019, Intel and Apple filed a joint antitrust lawsuit against Fortress Investment Group and several Patent Assertion Entities (PAEs, also known as Non-Practice Entities or NPEs), including VLSI. The companies attempted to prevent alleged anti-competitive behavior, but the case was dismissed. Intel appealed to the US Ninth Circuit in 2021, and last week the Court of Appeals found Intel’s claims to be defective.

“In other words, Intel has not presented sufficient facts to show that alleged price increases are due to patent aggregation,” the appellate court said in its Nov. 8 affirmation of the lower court’s dismissal of the antitrust lawsuit. “A mere ‘possibility’ that Fortress acted unlawfully is not sufficient.”

Having big legal business

A 2014 academic paper, “The Direct Costs from NPE Disputes”, [PDF] found that in 2011, “the estimated total direct, accrued costs of NPE patent claims totaled $29 billion.”

Big tech companies — many of which have amassed large patent portfolios that often justify them as defensive weapons — have complained for years about patent trolls/patent assertion entities/NPEs, which are companies that exist to file infringement suits.

Legislative changes, such as the US Supreme Court decision in Alice Corp. against CLS Bank International, which made it more difficult to obtain software patents, have reduced patent litigation – more lawsuits are being dismissed. But Intel has hinted in its antitrust argument against Fortress that patent courts are adapting to the new legal landscape.

“Faced with these challenges, PAEs have evolved,” the company said. “PAEs are increasingly working with investment firms to advance their litigation.”

According to Unified Patents, a membership-based patent defense group, “over 71 percent of all litigation in district courts in [the first half of] 2022 was related to the high-tech sector.” 95 percent of NPE litigation during this period involved high-tech companies.

The Open Innovation Network, a group of companies that came together not to challenge patents, was founded in 2005 by Red Hat, IBM, Novell, Philips and Sony. Since then it has grown to 3,700 members with more than 2.7 million patents and patent applications. ®