Intel threatens to pull AMD’s rights and licenses

Written by Ben Hardwidge

March 16, 2009 // 5:20 p.m.

Tags: #amd #antitrust #bruce #foundries #global #global-foundries #intel #license #licenses #notification #rights #sewell #x86

Intel’s relationship with AMD has been particularly rocky since AMD filed a massive antitrust case against Intel in 2005, but the situation took a further turn towards the rocks of doom today when Intel threatened to pull licenses and rights granted to AMD in a patent cross-license agreement in 2001. The threat relates to Intel’s belief that AMD breached the aforementioned agreement when it split into two companies in October 2008, creating a second foundry company.

In a statement issued today, Intel said that it “believes that Global Foundries is not a subsidiary under terms of the agreement and is therefore not licensed under the 2001 patent cross-license agreement.” The company also claimed that “the structure of the deal between AMD and ATIC breaches a confidential portion of that agreement,” adding that “Intel has asked AMD to make the relevant portion of the agreement public, but so far AMD has declined to do so.”

According to Intel, AMD’s breach of the agreement “could result in the loss of licenses and rights granted to AMD by Intel under the agreement.” This could include AMD’s x86 license from Intel, which would be a devastating blow to AMD in the current PC industry.

Explaining the threat, Intel’s senior vice president, Bruce Sewell, said that "intellectual property is a cornerstone of Intel's technology leadership and for more than 30 years, the company has believed in the strategic importance of licensing intellectual property in exchange for fair value. However AMD cannot unilaterally extend Intel's licensing rights to a third party without Intel's consent."

Sewell claimed that Intel had been attempting to address its concerns about AMD’s creation of a new foundry company since October. He added that “we are willing to find a resolution but at the same time we have an obligation to our stockholders to protect the billions of dollars we've invested in intellectual property." According to Intel, the terms of the agreement mean that both parties now have to “attempt to resolve the dispute through mediation.”

So far, AMD doesn’t seem particularly fazed by Intel’s notification. In response, the company stated that “Intel’s action is an attempt to distract the world from the global antitrust scrutiny it faces.” AMD also added that “should this matter proceed to litigation, we will prove that Intel fabricated this claim to interfere with our commercial relationships and thus has violated the cross-license.”

Is Intel really protecting its intellectual property here, or is it flexing its muscles to distract people from the antitrust case? Let us know your thoughts in the forums.

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