Nvidia countersues Intel in row over graphics patents

 

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By Reuters

Posted on 27 Mar 2009 at 07:39

Nvidia is countersuing Intel for breach of contract, as the dispute between the two companies heightens.

The suit seeks to terminate Intel's license to Nvidia's patents related to graphics processing and three-dimensional computing, and comes in response to a related suit from Intel last month.

Nvidia believes that without a licensing agreement, Intel's line of integrated graphics chips violate Nvidia's patent portfolio.

The complaint represents the latest salvo in an escalating feud between the two chipmakers that has moved from the marketplace to the courtroom.

Intel asked a Delaware court in February to rule that its new generation of processors, such as the Nehalem chip, are not covered under a 2004 cross-licensing agreement between the two companies. That would prevent Nvidia from selling chipsets that function alongside Intel's new processors.

In its countersuit, Nvidia says that Intel has "manufactured" the licensing dispute as part of a "calculated strategy to eliminate Nvidia as a competitive threat," and says it is fully licensed to continue making products that interact with Intel processors.

The disagreement stems from the fact that Intel's Nehalem processors feature an integrated memory controller. According to Intel, the 2004 licensing agreement only covers its previous generation of products, in which the memory controller was separate from the processor.

"There is a substantial disagreement between Intel and Nvidia about its licensing rights under the agreement," says Intel spokesman Chuck Mulloy.

"We've been trying multiple times, multiple ways to find a way to settle the argument," Mulloy adds, claiming the suit simply asks the court to interpret the agreement.

In its counterclaim, Nvidia argues Intel has attempted to steer customers away from Nvidia products for months by claiming there was a licensing dispute. By officially disavowing the licensing pact through its lawsuit, Intel has breached the contract, Nvidia insists.

"Having breached the contract and irreparably injured Nvidia, Intel has lost the right to continue to enjoy the considerable benefit of its license to Nvidia's patent portfolio."