January 31, 2003 11:12 AM PST
Intergraph sues Texas Instruments
Huntsville, Ala.-based Intergraph alleges that some of TI's digital signal processors, TI's flagship product, infringe three patents that describe how a chip can process instructions in parallel. The patents were used to develop Intergraph's Clipper chip, a processor that was touted for its technical capabilities but failed to achieve market success. Intergraph developed its technology in the early '90s, and the DSPs in question came out in 1997, Intergraph said.
Once a workstation manufacturer, Intergraph has become a services and software specialist that also derives a substantial portion of its profits from litigation and intellectual-property licensing. In 2002, the company reported revenue of $501 million. Income from operations came to $10.4 million. Net income including legal settlements came to $377.1 million.
To better manage its legal affairs, the company set up an intellectual-property division, a move followed by Unix developer SCO Group.
Last year, Intergraph settled two suits with Intel, which resulted in a combined payment of $450 million. In one suit, Intergraph claimed that Intel's Pentium family infringed its patents, and in the other, it alleged that the Itanium chip infringed other patents owned by Intergraph.
Intel may still pay Intergraph another $100 million, depending on the outcome of a pending appeal in the Itanium case.
In December, Intergraph filed a suit against Dell, Gateway and Hewlett-Packard alleging that the three PC makers violated its patents because the companies sold computers containing Pentium processors. Similar suits may be pursued against other PC makers, the company has indicated.
On Thursday, Intergraph also signed a cross-licensing patent agreement with IBM. Under the agreement, IBM will pay Intergraph $10 million and transfer various patents to Intergraph. Over the years, IBM and Intergraph had entered into various cross-licensing pacts that preceded the recent suits, a representative said.
The TI suit is based on the patents involved in the Itanium suit. While TI's chips perform different functions, they use a similar method to route instructions in parallel, which is the basis of the Intergraph patents. Parallel processing, used extensively in processors now, was on the cutting edge of research in the early '90s.
"The Clipper chip came out of the supercomputing world," an Intergraph representative said.
The TI suit was filed in the U.S. District Court for the Eastern District of Texas, the same district as the Dell-Gateway-HP suit and the Itanium suit.
TI could not be reached for comment, and Intergraph said the suit has yet to be served on the company.