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Rambus seeks royalties from Nvidia

The chip designer expands its universe of potential lawsuits by asserting that Nvidia products infringe on Rambus patents.

Rambus is seeking royalty payments from graphics chipmaker Nvidia, expanding its legal actions into a new sector of the chip industry.

Rambus, a memory chip designer based in Mountain View, Calif., has been involved in a number of lawsuits aimed at protecting its claims related to dynamic RAM, or DRAM, technology.

The legal discussions between Rambus and Santa Clara, Calif.-based Nvidia, the hot company of the moment in the graphics world, are spelled out in Nvidia's 10-Q quarterly filing with the Securities and Exchange Commission, dated Dec. 8.

"We have been advised by Rambus Inc. that it believes our products infringe certain patents owned by Rambus, and (the company requests) that we agree to certain licensing terms, including royalty payments," Nvidia said in the document.

Rambus claims that a series of patents filed in the early 1990s gives it the right to royalty payments over synchronous DRAM, or SDRAM, which is the most common form of memory in PCs today, as well as over double-data rate (DDR) SDRAM, a faster version of SDRAM coming onto the market now.

To date, Rambus has mostly sought royalty payments out of memory manufacturers such as Hitachi, which settled a case with Rambus earlier this year.

Other companies, however, incorporate memory or memory interfaces--the gateway that allows a part to "speak" to memory banks--into their products, making them potential defendants as well. Graphics chipmakers do so, thus putting them in the category of potential defendants.

Chipset makers, such as Via Technologies and Acer Labs, could also find themselves in legal discussions with Rambus because these companies make parts with memory interfaces.

"Rambus has claimed that the interface with the DRAM is covered by its technology patents," said Nathan Brookwood, an analyst at Insight64. "If this were to stand up, it would not only apply here. It would not only give (Rambus) access to DRAM sales, but to microprocessor sales, microcontroller sales, and graphics processor sales."

In Nvidia's filing, the company said that the patents Rambus has claimed are "invalid, not infringed, and unenforceable."

Nevertheless, Nvidia said it has entered into discussions with Rambus, "regarding potential business alternatives to Rambus' proposed licensing terms."

The company added, "We cannot guarantee that we will be able to reach a satisfactory agreement with Rambus. If we are unable to do so, Rambus may sue us for patent infringement at any time."

Nvidia now finds itself in a position similar to Micron Technology, Infineon Technologies and Hyundai Electronics Industries, all memory makers that are in various stages of litigation with Rambus.

The Micron and Hyundai suits are expected to head to court in February, while the Infineon suit has been scheduled for May.

Rambus spokeswoman Kristine Wiseman declined to comment on any negotiations. But she did say it was logical for Rambus to try to protect its technology patents on the interface.

Rambus has patents that relate to core DRAM technology, Wiseman said, but "what Rambus specializes in is the interface."

Nvidia did not return calls requesting comment on its 10-Q filing.