On March 2, 2021, a Texas jury ordered Intel to pay VLSI Technology LLC $2.18 billion in damages for patent infringement, one of the largest patent awards in U.S. history. The two patents at-issue are directed towards methods for increasing the power and speed of computer chips, and have a history of switching corporate hands. Before reaching VLSI, the patents-in-suit were owned by NXP Semiconductors Inc., a company that branched off from Philips, and Freescale Semiconductor, another company that spun off from Motorola. NXP acquired the patents when it bought Freescale, and they were transferred to VLSI in 2019.
Intel maintained at trial that it did not infringe the subject matter of the patents, but rather had invented its own techniques to improve chip performance. However, the jury decided otherwise and returned a verdict in favor of VLSI. Intel strongly opposes the outcome, plans to appeal, and maintains that VLSI has no products or sources of revenue aside from patent litigation. Still, Intel can breathe a small sigh of relief in the shadow of the massive judgment–had the jury found willful infringement, the judge could have increased the damage award up to three times.
Intel has dominated the billion-dollar chip industry for several decades. The damage award is reportedly equal to approximately half of Intel’s fourth-quarter profit and, while still up 23% on the year, Intel stock has fallen 2.6% since the verdict. On the other hand, of course, VLSI stated it is “extremely happy” with the result.
This case is VLSI Technology LLC v. Intel Corporation (Case No. 6:21-cv-0057-ADA) in the United States District Court for the Western District of Texas, Waco Division.