Intel Corporation and VLSI Technology LLC are poised for another legal confrontation at the Federal Circuit, marking a significant chapter in their ongoing patent litigation saga. This dispute, centered on semiconductor patents, has seen a series of complex legal maneuvers, including substantial verdicts, licensing debates, and allegations of fraud.
In February 2021, a jury in the Western District of Texas awarded VLSI $2.18 billion in damages, finding that Intel had infringed two of VLSI’s patents. The verdict comprised $1.5 billion for literal infringement of one patent and $675 million for infringement under the doctrine of equivalents of another patent. However, in December 2023, the Federal Circuit vacated this award, citing errors in VLSI’s damages calculations and reversing the infringement finding on one of the patents. The court remanded the case for a new trial focused solely on determining appropriate damages for the remaining patent. ([theiplawblog.com](https://www.theiplawblog.com/2023/12/articles/patent-law/federal-circuit-vacates-vlsis-2-2-billion-damage-award-against-intel/?utm_source=openai))
Intel has also pursued a licensing defense, asserting that it holds a license to VLSI’s patents through its acquisition of Finjan, Inc., a company with a pre-existing license agreement. The district court initially denied Intel’s motion to amend its answer to include this defense. However, the Federal Circuit reversed this decision, allowing Intel to present its licensing argument. The core issue revolves around whether VLSI and Finjan are under the common control of Fortress Investment Group, which could potentially extend the license to Intel. ([caselaw.findlaw.com](https://caselaw.findlaw.com/court/us-federal-circuit/115576174.html?utm_source=openai))
Beyond the U.S. courts, the litigation has extended to China. In May 2019, VLSI filed a case in the Shenzhen Intermediate People’s Court against Intel and its Chinese subsidiaries, alleging patent infringement by certain Intel Core processors. VLSI sought an injunction and costs but did not claim damages. In September 2023, the China National Intellectual Property Administration invalidated all claims of the asserted patent, leading the Shenzhen court to dismiss VLSI’s case in November 2023. ([intc.com](https://www.intc.com/filings-reports/annual-reports/content/0000050863-25-000009/0000050863-25-000009.pdf?utm_source=openai))
As the Federal Circuit prepares to hear arguments, the outcome could have significant implications for both companies. A ruling in favor of VLSI might lead to substantial financial liabilities for Intel, while a decision favoring Intel could undermine VLSI’s litigation strategy. Legal professionals and industry observers are closely monitoring this case, recognizing its potential to influence patent litigation practices and licensing agreements within the semiconductor industry.