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Friday, March 27, 2009
Nvidia Files Countersuit Against Intel

Nvidia countersued Intel Corp for breach of contract on Thursday, alleging that Intel made misleading statements designed to undermine Nvidia's licensing rights.

The countersuit was filed in the Court of Chancery in the State of Delaware for for breach of contract. The action also seeks to terminate Intel's license to Nvidia's patent portfolio.

Nvidia's countersuit was brought in response to a filing by Intel last month in the Delaware court, alleging that the four-year-old chipset license agreement does not extend to Intel's future generation CPUs with "integrated" memory controllers, such as its Nehalem processor.

"Nvidia did not initiate this legal dispute," said Jen-Hsun Huang, president and CEO of Nvidia. "But we must defend ourselves and the rights we negotiated for when we provided Intel access to our valuable patents. Intel's actions are intended to block us from making use of the very license rights that they agreed to provide."

The suit seeks to terminate Intel's license to Nvidia's patents related to graphics processing and three-dimensional computing and comes in response to a related suit by Intel last month. Nvidia believes that without a licensing agreement, Intel's line of integrated graphics chips violate Nvidia's patent portfolio.

Intel asked a Delaware court in February to rule that its new generation of microprocessors, such as the Nehalem chip, are not covered under a 2004 cross-licensing agreement between the two companies. That would prevent Nvidia from selling its chipsets that function alongside Intel's new microprocessors.

The disagreement stems from the fact that Intel's new generation of Nehalem microprocessors feature an integrated memory controller. According to Intel, the 2004 licensing agreement only covers its previous generation of products, in which the memory controller was separate from the microprocessor.

To read Intel's initial filing, go to:

To read NVIDIA's response and counterclaim, go to:

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