May 13, 1997 7:00 PM PDT

Digital, Cyrix sue Intel over patents

In an unprecedented development, Intel has been socked with two major law suits in one day.

Less than 12 hours after Digital Equipment (DEC) announced that it had filed a lawsuit against Intel (INTC), claiming patent infringement, Cyrix (CYRX) has also filed a suit.

Both Digital and Cyrix are claiming that Intel has infringed on their patents for chip technology.

Cyrix says that Intel has violated two patents. One related to power management and the other to a chip's "registers," a small amount of high-speed memory located within a processor.

"Both patents were awarded today by the U.S. patent office," said a Cyrix spokesperson, referring to the timing of the announcement. An Intel spokesperson said the company had no comment since Intel has not yet seen the complaint.

The suit seeks preliminary and permanent injunctive relief along with unspecified damages and fees.

Meanwhile, earlier in the day, Digital Equipment announced that it had filed a lawsuit in the U.S. District Court in Worcester, Massachusetts, charging Intel with "willful infringement" of ten Digital patents related to the company's microprocessors. (Intel is an investor in CNET: The Computer Network.)


Digital CEO Bob Palmer on why Digital is suing Intel
 
"I don't mind competing against Intel, but I'd rather not compete against our own technology," Digital CEO Robert Palmer said. "The time has come for these unlawful practices to stop."

The patents included in the lawsuit relate to Digital's cache management, branch prediction, and instruction-processing technology within the Alpha processor. Patents covering these areas were issued to Digital between 1988 and 1996.

The lawsuit would stop Intel from using Digital's technology in current and future chip introductions, according to a company statement, and seeks an injunction and monetary damage for the patent infringement.

An Intel spokesman would not comment on the case itself, but he did offer a reaction to Digital's move: "We are completely surprised by this. We are especially surprised given our long-standing relationship from both a customer and technology level with Digital."

Digital includes Intel microprocessors in a line of PCs and servers. Palmer added that he expected the supply relationship Digital has with Intel to continue despite the lawsuit.

Palmer said he initially became suspicious of potential infringements on patented Digital technology when Intel released the Pentium Pro, a microprocessor that significantly advanced the company's processor speeds. Then Digital investigated the Pentium series chip and has now incorporated the Pentium II into their investigation.


Palmer on why the suit will protect competition
The Digital CEO said he was "energized" to action by a Wall Street Journal article from August of 1996 concerning Intel's increasing emphasis on processor design research. Intel senior executives Andy Grove and Craig Barrett are both quoted in the story, which lays out a plan by the microprocessor maker to innovate because, as the article states, Intel has done "almost no original microprocessor research."

Palmer's stamp on Digital is directly tied to the Alpha processor. He initiated research and development activities on the chip and continues to champion the technology, even though it has not taken off as he expected and continues to drain Digital resources because of the huge expense of operating chip fabrication plants. The CEO said the Digital board has "fully supported the actions we've taken" against Intel.

The recently unveiled Intel Pentium II microprocessor wraps multimedia capabilities in a chip that is faster than previous Intel models. The Pentium II introduction arrives on the heels of the Pentium Pro processor, which has blurred the price-performance lines between typical PC-based server computers and high-speed boxes based on RISC (Reduced Instruction Set Computing) chip architectures.

Digital has kept well ahead of Intel speeds with the RISC Alpha chip but has not been able to drive the microprocessor as a volume alternative. The company recently discounted certain versions of the chip in order to better compete with Intel products.

Intel shares were down in trading this morning from its close of 159-1/8, while Digital's share price rose from its close of 33 1/8.

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