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Marvell faces $1.17B fine due to patent infringement

Posted: 28 Dec 2012 ?? ?Print Version ?Bookmark and Share

Keywords:patent infringement? magnetic discs? licensing?

Marvell Technology Group was ordered by a U.S. federal court Wednesday to pay $1.17 billion after being found guilty of patent infringement against the Carnegie Mellon University.

The infringed patents, said to have been used for hard disc drive circuits to read data from high-speed magnetic discs, were developed by Carnegie Mellon Professor Jose Moura and then doctoral student Aleksandar Kavcic. The jury concluded that Marvell was not licensed to sell chips which incorporated technology based on the patents.

The $1.17 billion fine that Marvell is expected to pay is said to be close to double the company's earnings in this fiscal year. With the jury finding that the infringement was 'wilful,' the trial judge can grant triple damages amounting to as much as the company's current market value of $3.96 billion. Shares of Marvell dropped fell 10.3 per cent on Wednesday, according to a report from Reuters.

Marvell said in an official statement that it will seek to void the verdict, which awarded one of the largest damages fee in a U.S. patent infringement case. Carnegie Mellon filed the lawsuit back in March 2009 over patents issued in 2001 and 2002.

Marvell has been working hard to establish itself as an industry leader in a highly competitive chip market. In an interview with EE Times back in July, co-founder Weili Dai stated the importance of Marvell's presence in Silicon Valley in order to achieve its goal of becoming the largest semiconductor company. (See Marvell desires to become chip leader in China.)

Dai fired back at several financial analysts who have downgraded Marvell after warnings of falling quarterly sales stemming from weak PC demand. Dai stressed that her company has rebounded several times in the past and that it is eagerly ready for the era of interconnected smart devices. (See Marvell prepared for coming super-integration era.)

Marvell introduced earlier this month a WLAN SoC which the company says improves the throughput of enterprise retail access points and the robustness of wireless video distribution. (See Marvell claims 802.11ac SoC boosts Wi-Fi throughput.) Back in June 2011, Marvell invested in the development of its own TD-SCDMA modem chip to support China's TD-SCDMA telecommunications standard. (See Marvell develops single-chip solution for TD-SCDMA.)

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