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Silicon Image, Genesis settle licensing agreement

Posted: 27 Dec 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Silicon Image? Genesis Microchip? settlement agreement? patent?

Silicon Image has signed a settlement and license agreement with Genesis Microchip Inc., which includes provisions for ongoing royalty licensing revenue for the company's DVI and HDMI products, resolving an outstanding patent matter between the two companies.

As a result of this agreement, Silicon Image will record a one-time catch-up of previously earned royalties and a partial recovery of patent assertion costs in its Q4 ending Dec. 31, 2006.

According to the press release, the agreement concludes matters associated with a suit that Silicon Image originally filed in 2001 in the U.S. District Court for the Eastern District of Virginia against Genesis Microchip Corp. and Genesis Microchip Inc. (collectively, "Genesis") for infringement of the company's patents.

Genesis had paid Silicon Image $11 million through Sept. 30, 2006. Upon signing the settlement and license agreement, Genesis is obligated to pay additional and the company expects to record approximately a $13 to $15 million increase (inclusive of the $11 million in payments received) in operating income in the end of the quarter.

The exact composition of increase between licensing revenue, recovery of patent assertion expenses and other items is not currently known as Silicon Image is awaiting required royalty data from Genesis.

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