Thursday, November 12, 2009

AMD and Intel Announce Settlement of All Disputes

SUNNYVALE/SANTA CLARA, Calif. – Nov. 12, 2009 – Intel Corporation and Advanced Micro Devices today announced a comprehensive agreement to end all outstanding legal disputes between the companies, including antitrust litigation and patent cross license disputes.

Under terms of the agreement, AMD and Intel obtain patent rights from a new 5-year cross license agreement, Intel and AMD will give up any claims of breach from the previous license agreement, and Intel will pay AMD $1.25 billion. Intel has also agreed to abide by a set of business practice provisions. As a result, AMD will drop all pending litigation including the case in U.S. District Court in Delaware and two cases pending in Japan. AMD will also withdraw all of its regulatory complaints worldwide. The agreement will be made public in filings with the Securities and Exchange Commission.

AMD CEO Dirk Meyer said there are three key components to the agreement:

* First, Intel has agreed to an important set of ground rules that we hope will define the path to a free and open market in the microprocessor industry;

* Second, we have agreed to a new patent cross-license agreement that gives AMD broad rights and the freedom to operate a business utilizing multiple foundries,

* And third, GLOBALFOUNDRIES has agreed to terms that allow them the freedom to operate as an independent world-class leading-edge foundry company, going forward, without being a subsidiary of AMD.

AMD said in a conference call this morning that this agreement gives ATIC, the co-owner of GlobalFoundries, much more flexibility and could allow it to merge GlobalFoundries and Chartered Semiconductor, which ATIC acquired in September. This deal also allows AMD to produce all of its processors in third-party fabs, freeing it from the restriction of having to be GlobalFoundries' parent company.

The two companies commented in a joint statement about today's agreement, "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."

Related news:
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PCWorld-AMD Settlement Expected to Hit Intel's Net Profit in Q4
Fudzilla-Intel's cash will help AMD
The Washington Post-Intel settles AMD suits, but antitrust investigations by U.S., E.U. continue

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