VLSI loses remaining patent in $2.2bn Intel case
Computer chip giant convinces US tribunal to invalidate second patent in dispute that originally cost $2.2bn in damages | Verdict removes remaining $1.5bn award after appeal was lodged by patent holding company.
A semiconductor patent worth $1.5 billion in damages in a high-profile dispute has been invalidated by the US Patent Trial and Appeal Board ( PTAB). In a decision delivered yesterday, June 13, a PTAB tribunal ruled that the patent, owned by VLSI Technology, was invalid after Intel convinced the Board that all 16 of the claims were unpatentable.
The ruling dismantles the remaining chunk of the original $2.18 billion verdict from 2021, when Intel lost to VLSI in a Texas federal court.
Co-petitioner Patent Quality Assurance (PQA) set the ball in motion to invalidate US patent number 7,523,373 B2, filing a petition for inter partes review of all 16 claims of the patent, owned by VLSI. Intel was later joined as a party to the proceedings.
Intel said it is “pleased” with the outcome, adding that VLSI’s “low-quality” patents had “wrongly forced Intel to litigate” in the 2021 Texas trial.
In a statement emailed to WIPR, Intel said it originally petitioned the Patent Office to review the validity of the patents in 2019 and 2020, “but [it] issued ‘discretionary denials’ without even considering Intel’s submissions, now found to invalidate those patents.”
‘Weaponisation’ of patents
“We are glad VLSI’s patents have been invalidated, but there remain a handful of patents being asserted in abusive patent litigation where the Patent Office issued similar ‘discretionary denials’ without even considering petitioners’ invalidity submissions.
“We join others in urging the Patent Office to revisit past submissions which cannot be reinstated by the original petitioners and prevent the weaponisation of invalid patents being used for investment litigation.”
The now-invalidated ’373 patent, titled “Minimum Memory Operating Voltage Technique”, makes “tradeoffs between performance and power” by operating processors “at maximum voltage and frequency when peak performance is required” and “at low voltage and frequency to reduce power consumption” at other times.
OpenSky’s involvement
It comes just a month after Intel and OpenSky Industries succeeded in persuading the PTAB to invalidate a separate patent held by VLSI, US patent number 7,725,759, a decision described by one lawyer as “destabilising”.
Nick Matich, principal at McKool Smith in Washington, DC, told WIPR at the time that: “Leaving patent rights open to never-ending validity challenges is destabilising and destroys the incentives patent rights are meant to create.”
That verdict was delivered despite OpenSky being sanctioned last year by Kathi Vidal, director of the US Patent and Trademark Office ( USPTO), for alleged abuse of the inter partes review (IPR) process.
The ‘759 patent, relating to a semiconductor—was worth $675 million of the total damages awarded in 2021.
In a company statement following the May verdict, Intel said it was “pleased the Patent Office invalidated VLSI’s low-quality patent”.
“VLSI is a shell company that abuses our patent system to extract billions of dollars from Intel, an American manufacturer and innovator,” Intel said.
It added that the decision” demonstrates VLSI’s patent claims against Intel are meritless and underscores the desirability of Patent Office review before expensive and wasteful courtroom trials."
WIPR also contacted counsel for PQA and VLSI for comment on the June 13 verdict, without immediate response.
This article was updated later on the day of publication to add Intel's comments.
