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Magma ends long-lived patent war with Synopsys

Posted: 03 Apr 2007 ?? ?Print Version ?Bookmark and Share

Keywords:Magma patent resolution? Synopsys patent dispute?

Magma Design Automation has paid $12.5 million to end a long-running patent dispute with Synopsys Inc., and the expense may well be worth it. Magma is not only letting go of a legal expense that has strongly impacted the company's bottom line, but early indications are that its market capitalization, and ability to do future acquisitions, will significantly improve as well.

Magma and Synopsys announced on March 29 that they have agreed to settle all pending litigation between them, resolving separate court cases in California and Delaware. As part of the settlement, each company is cross-licensing four previously disputed patents to the other, as well as any related applications.

Both companies agreed not to initiate future patent litigation against each other for two years, provided certain terms are met. There was no admission of guilt. Aside from the $12.5 million payment from Magma to Synopsys, all other terms of the out-of-court settlement are confidential.

"This just removes an expense item from our budget and allows us to focus on our customers and our business," said David Stanley, Magma general counsel. He said that Magma has been paying around $11 to $12 million a year in legal expenses. That's a big deal for a company with annual revenues currently around $180 million.

Brian Cabrera, VP and general counsel at Synopsys, said his company got what it wantedthe return of disputed patents to Synopsys ownership. "We absolutely feel like we won this," he said. "We got the technology back in our name, and now we can move on and not waste legal resources and get back to business."

Magma and Synopsys have been locked in a complex legal dispute since 2004, when Synopsys first sued Magma for allegedly infringing two patents. Claims and counter-claims accelerated, resulting in separate court cases in California and Delaware and a number of disputed patents. At the time of the resolution, Stanley said, Magma was asserting four patents in Delaware, and Synopsys was asserting one, while Synopsys was asserting three patents in California.

- Dylan McGrath and Richard Goering
EE Times

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