Infineon goes for the Rodime gambit


In Dresden and Munich, the receivers in charge of Infineon's erstwhile memory subsidiary Qimonda are flogging off the remaining fab equipment and office furniture that haven't found homes at companies such as Texas Instruments.

However, Infineon has not sold some of the soft assets, such as patents that were filed under the German chipmaker's stewardship. And the company seems to be following the Rodime plan to getting some of its investment back: sue the people still in the DRAM business for infringment. I assume it will stop short of getting into the sports-betting business. However, before it bought Littlewoods' betting operation, Rodime managed to extract a tidy sum in licensing fees from various big disk-drive makers after the Scottish company shut its own manufacturing plant.

Infineon said it filed a complaint with the US International Trade Commission against Elpida, pushing for an exclusion order that will prevent the Japanese memory maker from importing its memory devices into the US even though Infineon no longer sells anything that competes.

So far, the complaint hasn't received a docket number from the ITC, and the organisation has not said that it will investigate the complaint. Infineon has claimed Elpida infringed four of its patents when making the DRAMs it currently ships.

At the IP conference a couple of years ago, Mike McLean of technology-analyst Semiconductor Insights predicted a rise in complaints by companies armed with large patent portfolios. But acknowledged there are issues with suing competitors when the litigation may affect customers of both parties.

“The companies may not be the most popular in the world,” McLean noted. “Are you willing to license [patents] where there are pre-existing business relationships. Do you risk damaging that relationship? Is there a willingness to litigate?”

Jack Browne, then president and CEO of MIPS Technologies, put it more starkly: “You do have to be prepared for thermonuclear warfare when you decide to go to litigation.”

As companies get bounced out of markets in which they used to compete aggressively, more will be tempted to pursue the Rodime option and use the patent collection they built up. As chipmaking involves a complex web of IP, no-one will be immune to the potential of patent suits. And, because those companies have left the market, the threat of mutually assured destruction will not bring the traditional solution: a big bag of cross-licensed patents.