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Intel agrees to pay AMD $1.25 billion in damages

by Sylvie Barak on 12 November 2009, 14:16

Tags: Intel (NASDAQ:INTC), AMD (NYSE:AMD)

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Time to settle down

In a shock move, AMD and Intel just announced they have reached a settlement on both the pending antitrust suit and IP disputes, with Intel also paying AMD over a billion dollars in damages.

The "comprehensive agreement" between the firms puts all outstanding legal disputes between the companies to bed, most notably AMD's case against Intel in Delaware over antitrust, and Intel's dispute of a patent cross license.

Intel had notified AMD that it believed the firm to be in breach of the cross license agreement back in March.

A joint statement by the firms reads: "While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development."

The agreement means both AMD and Intel will get patent rights from a newly-drawn-up five-year cross-license agreement, while both parties agree to drop any more claims of breach from the previous license agreement.

In addition, Intel has agreed to cough up $1.25 billion in payments to AMD, whilst also agreeing to abide by a set of business practice provisions meant to keep the firm on the straight and narrow from now on. In exchange for this conciliatory gesture, AMD will now drop all pending litigation against its big blue rival, not only in Delaware, but also in two pending cases in Japan.

AMD will also apparently be withdrawing its regulatory complaints worldwide, not that it helps much in the case of the EU, which already passed judgment on Intel earlier this year to the tune of $1.06 billion.

The agreement by both firms is to be made public in Securities and Exchange Commission (SEC) filings.

 



HEXUS Forums :: 13 Comments

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Erm... good?
I did not see this one coming. WOW...

Commend Intel for settling, I can only hope this means they realise the business practices they employed were wrong and have now learnt a valuable lesson. Plus $1.25 Billion in damages been paid to AMD means no more debt for them.

I look forward to good innovation coming from AMD now that they don't have severe money constraints. This should improve innovation in the CPU market where AMD has been lagging behind badly.

2010 and 2011 are looking promising now :D
ExHail
I did not see this one coming. WOW...

Commend Intel for settling, I can only hope this means they realise the business practices they employed were wrong and have now learnt a valuable lesson. Plus $1.25 Billion in damages been paid to AMD means no more debt for them.


Imo, Intel may have realised that settling now would be cheaper than waiting for the court to decide on damages... or AMD desperately needed cash.
Cheaper for intel to pay AMD $1billion nw than to pay $1billion in each market that the legal disputes are in. IMO they still need to be investigated for anti competitive practices as in the longer term everyone suffers due to them.
nightkhaos
Erm... good?
I'd go beyond good. The only way this could get better for AMD is if Intel forget to do any R&D for the next 2 years, allowing AMD to catch up ;)

Hopefully what it will mean is genuine development and performance tuning of Bulldozer and Bobcat before release, as AMD will have a stable financial foundation to base that on and have decent and profitable mid-range components already in the market place. The real issue for them when Intel released Core 2 was that they didn't have anything comparable, and they didn't have the resources to properly develop and tune Phenom before release - if they had we might have seen Phenom II months earlier.

As it is, it looks like AMD is going to have to take a back seat in the processor market for another year, in which case one hopes they'll be going all out for the graphics market (since they've already stolen a lead in that one!)in 2010 and pushing out some really fantastic CPUs / APUs in 2011. You never know, I might even have enough cash for a new system by then... ;)