Hynix Semiconductor faces the prospect of paying U.S. research firm Rambus up to $150 million in penalties for violating patent arrangements. The trial began in a U.S. court this week.
This is the third known legal battle facing the Korean semiconductor maker in the recent months, following the conviction of its executives for chip price-fixing in the U.S., and a formal complaint by Japan about alleged subsidization.
Hynix, the world’s second largest DRAM (dynamic random access memory) maker, is being sued by Rambus for infringing its patents of DRAM from 2000. After a six-years of legal saber rattling, the jury trial started on Monday with a verdict expected within a month. The verdict could order Hynix to pay royalties for its $4.4 billion sales in the United States since 2000.
Neither company revealed the exact amount of the claimed royalties but Rambus is expecting 3.5 percent of Hynix revenues in the United States as compensation, Hynix’ public relations official Jin Kwang-sun said.
``The case has been developing for a long time, and it would not be the end [of the dispute],’’ Jin said. ``Even if we win this case, they [Rambus] will come up with similar law suits again and again.’’
Rambus owns various patents regarding technologies that boost the communications speed of DRAMs, the memory chips used in PCs and many other digital items. Chipmakers such as Hynix and Samsung Electronics have been developing alternative technologies to avoid paying royalties to Rambus.
The stock market has been unfavorable to Hynix regarding the case. Rambus shares have almost doubled since the start of the year in Nasdaq stock market trading. Conversely, Hynix shares have lost more than a quarter of their price in the same period.
The Rambus case could be the latest blow to Hynix in a series of attacks from abroad.
Last month, four Hynix executives pleaded guilty and were sentenced to up to eight months jail for fixing DRAM prices in the United States with other chip makers from 1999 to 2002.
Regarding the same case, the company was fined $185 million by the U.S. government in 2004.
Last October, the Japanese government decided to impose a 22.7-percent countervailing duty on Hynix over allegations that it violated global trade rules by receiving Korean government subsidies,.
To escape the Rambus case, Hynix counterclaimed that Rambus deliberately destroyed documents by which the chipmakers might seek to defend themselves. However, in January the U.S. District Court rejected the counterclaim.
Rambus has also filed similar lawsuits against other chipmakers, including Samsung Electronics, the world’s leading DRAM maker. The trials against other chipmakers are yet to begin.
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