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Intel loses fight over FTC lawyer

The judge hearing the FTC's antitrust action against Intel denied its request to oust one of the agency's top litigators.

The judge hearing the Federal Trade Commission's antitrust action against Intel denied the chip giant's request to oust one of the agency's top litigators from the case, just weeks before it is set to go to trial.

In a motion filed under seal last month, Intel sought to disqualify Richard Parker, deputy director of the FTC's bureau of competition and the lead attorney prosecuting the agency's case against Intel, as first reported by CNET The Santa Clara, California, chipmaker objected to work Parker performed on behalf of Intel archrival Advanced Micro Devices. A top AMD executive is scheduled to testify against Intel in the trial, which is set to start March 9.

In a ruling issued today, administrative law judge James Timony rejected Intel's argument that Parker's involvement in the case violated the company's due process rights. Timony noted that two federal ethics agencies cleared Parker's participation, which officially began last September.

"Because Mr. Parker does not represent any interest that could call into question his loyalty to the public interest, no due process issues arise," Timony wrote in the five-page ruling.

Timony's order comes as the names of two new potential trial witnesses emerged. They are Dean A. Klein, former chief technical officer of Micron Electronics, and Donald Lewine, an engineering consultant with Data General. Intel objected to both witnesses being called at the trial, as well as the calling of AMD chief operating officer Atiq Raza. Timony rejected the requests late last week.

The loss of Parker could have been huge for the FTC.

"There's a lot at stake for the commission, because Rich is perhaps the most capable person to litigate this case in the bureau of competition," said William Kovacic, a visiting professor at George Washington University. His disqualification "would be the equivalent of having one of your premier, all-star performers having to sit on the bench."

Before Parker was assigned to the Intel case, the agency's Designated Agency Ethics Officer specifically approved his role, Timony noted. In December, the federal Office of Government Ethics affirmed that decision.

"We're confident there's no issue," Streitfeld added. The motion "is one of those things that gets raised to disrupt the process."

For more than 20 years before he came to the FTC, Parker was a partner at O'Melveny & Myers, a law firm that has close ties to AMD. In 1997, Parker helped AMD respond to civil subpoenas that ultimately led to the filing of the FTC's complaint against Intel, Timony noted. In the early 1990s, the law firm helped AMD prevail against Intel in a high-profile battle over "microcode" to the 386 and 486 chips. Tom McCoy, an O'Melveny partner who oversaw a number of AMD's disputes with Intel, eventually became general counsel for the smaller chipmaker.

AMD has harbored a longstanding gripe with Intel over its alleged strong-arm tactics within the chip industry and has not been shy in sharing its complaints with FTC investigators, according to people familiar with the matter. As previously reported, AMD chief operating officer Atiq Raza is a potential FTC witness in the trial.

Under ethical guidelines established by the government, prosecutors are supposed to advocate on behalf of the general public, not any particular person or company, said John Steele, a partner at Fenwick & West who teaches an ethics class at the University of California at Berkeley's Boalt Hall School of Law.

"Intel would have standing to complain if they could prove that Parker's loyalty to AMD might override his loyalty to the public interest," Steele said.

In a complaint filed in June, the FTC accused Intel of maintaining its alleged monopoly in the microchip industry by withholding crucial technical information from computer companies that refused to license their intellectual property in ways that benefited Intel. The FTC alleges Intel's actions--taken against computer makers Intergraph, Compaq Computer, and Digital Equipment--illegally thwart competition.

Timony's order today addressed the oft-repeated rumor that the FTC has recently expanded its case to include new allegations.

"Intel argues that since Mr. Parker has been on the case, complaint counsel 'has recently shifted gears in an effort to adopt a theory advocated by the prosecutor's private client,'" Timony wrote in reference to AMD. "From what I have seen, however, complaint counsel's theory of the case has not fundamentally changed."

Two more potential witnesses
Meanwhile, companies confirmed two new names to appear the list of potential witnesses testifying for the FTC in the case. Klein was recently named vice president of enhanced products at Micron Technology, the parent company of PC maker Micron Electronics.

Data General's Lewine, meanwhile, was also confirmed as a witness, but a company spokesman described the senior engineer's testimony as "a personal matter having nothing to do with Data General."

A final witness list will be made public on February 19.