Intel, AMD in licensing brawl over GlobalFoundries


— 12:02 PM on March 16, 2009

Intel has formally accused AMD of breaching the two companies' 2001 cross-licensing agreement. This development probably shouldn't come as a surprise, since Intel questioned the legality of AMD's foundry spin-off way back in October last year. Now that AMD's former manufacturing business is finally operating as a separate company—GlobalFoundries—Intel has taken action.

Here's why Intel thinks AMD is breaching the agreement:

Intel believes that Global Foundries is not a subsidiary under terms of the agreement and is therefore not licensed under the 2001 patent cross-license agreement. Intel also said the structure of the deal between AMD and ATIC breaches a confidential portion of that agreement. Intel has asked AMD to make the relevant portion of the agreement public, but so far AMD has declined to do so.

Intel adds that it has "attempted to address [its] concerns with AMD without success since October," and the alleged breach could lead Intel to take away AMD's licensing rights. However, the company says it is "willing to find a resolution."

What does AMD have to say about all this? The firm responded with the following statement:

Intel's action is an attempt to distract the world from the global antitrust scrutiny it faces. Should this matter proceed to litigation, we will prove not only that Intel is wrong, but also that Intel fabricated this claim to interfere with our commercial relationships and thus has violated the cross-license.

According to AMD's form 8-K filing, Intel isn't kidding about taking away AMD's license—it "purports to terminate [AMD]'s rights and licenses under the Cross License in 60 days if the alleged breach has not been corrected." Naturally, AMD doesn't think it's doing anything wrong. As a matter of fact, the smaller company thinks Intel has violated the agreement by making those threats:

[AMD] maintains that Intel's purported attempt to terminate [AMD]'s rights and licenses under the Cross License itself constitutes a material breach of the Cross License by Intel[,] which gives [AMD] the right to terminate Intel's rights and licenses . . . while retaining [AMD]'s rights and licenses under the Cross License Agreement.

Judging by the wording of that sentence, it seems like AMD thinks it's entitled to take away Intel's x86-64 license while continuing to make x86 processors. Intel currently uses AMD's x86-64 technology in all shipping Pentium and Core processors, while AMD, naturally, uses Intel's x86 tech in all of its PC processors.

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