A federal district judge denied Qualcomm’s request for a stay in a patent suit by Broadcom. The rejection Monday clears the way for Qualcomm to file an appeal with the U.S. Appeals Court for the Federal Circuit and seek a stay there. In Santa Ana, Calif., in late December, U.S. District Judge James Selna, who rejected Qualcomm’s stay petition, granted Broadcom’s request to enjoin Qualcomm products said to infringe Broadcom patents (CD Jan 3 p1). Stifel Nicolaus analyst Blair Levin said Qualcomm may be hard-pressed to get a stay from the Federal Circuit because Judge Selna’s Dec. 31 ruling delayed the effectiveness of the injunction on products related to the patents until Jan. 31, 2009, to give Qualcomm time to develop work-arounds. Selna’s denial of a stay doesn’t affect chips infringing a video compression patent, which were not covered by the delayed effective date. A Qualcomm official said the company had no comment.
Broadband over powerline chipmaker Intellon said Sumitomo Electric Industries picked its HomePlug AV-based chipsets for in-home distribution of broadband services to subscribers in Japan. Intellon chips see use in Sumitomo adapters, which provide connectivity from a broadband access modem to other devices in a customer’s home using existing electrical wiring, the company said.
Broadcom got $31.8 million in royalties from Verizon in Q4 from the July license the companies signed to circumvent an International Trade Commission injunction against Qualcomm chips, Broadcom said, releasing quarterly earnings. Broadcom net revenue rose 11.2 percent year- over-year to $1.03 billion. Revenue for the full year was $3.78 billion, 3 percent more than in 2006. “2007 ended strongly as Broadcom generated record revenue for the fourth quarter and the full year, driven by the ramp in new product cycles occurring in the Bluetooth, wireless LAN and digital TV markets,” CEO Scott McGregor said. “Bluetooth, wireless LAN and digital TV will continue to be key revenue drivers, plus we look forward to the emergence of new product areas such as HD DVD, cellular and GPS, in addition to continued growth opportunities within our traditional end markets, such as switching and set-top boxes.”
Qualcomm continues to develop workarounds for products banned by a Dec. 31 Santa Ana U.S. District Court injunction (CD Jan 3 p1), the semiconductor maker said last week as it reported fiscal Q1 results. Devices using a Qualcomm workaround for one infringed patent will go on sale this quarter, it said. Qualcomm has said it will appeal and filed motions to stay and clarify the ruling. Factoring in the injunction, Qualcomm estimates $9.6-$10 billion in fiscal year 2008 revenue, up 8-13 percent from fiscal year 2007, it said. The guidance doesn’t include royalties Nokia owes under a license agreement, it said. Qualcomm won’t record royalties on Nokia sales after April 9, 2007, “until an arbitrator (or court) awards damages or the disputes are otherwise resolved by agreement with Nokia,” Qualcomm said. In fiscal Q1, Qualcomm revenue year-over-year rose 21 percent to $2.44 billion. Net income grew 18 percent year-over-year to $767 million.
Motorola shares plummeted 18.75 percent in regular trading Wednesday after the device maker said it expects demand for its handsets to keep slowing in 2008. Falling cellphone market share sank Motorola net earnings for Q4 $423 million year-over-year to $100 million, the handset maker said Wednesday. “2008 will be a challenging year and the recovery of mobile devices will take longer than previously expected,” said CEO Greg Brown in a Q4 results call. “We are taking on these challenges with both a sense of determination and urgency.”
The FTC said federal regulators can’t let companies buy patents that are part of the Ethernet standard, then jack up royalties. The Commission settled with a company it accused of breaking U.S. law by revisiting an agreement with the IEEE. In a rare split decision, the Commission settled charges that Chicago-based Negotiated Data Solutions violated the FTC Act but not antitrust law, a graver charge. Two Republicans among the five commissioners dissented, including the chairman.
French Internet service provider Free will use Intellon BPL chipsets to provide triple-play services, including Internet Protocol TV, Intellon said. By embedding Intellon chips into power supplies providing power and communications for its set-top boxes, Free can add BPL without redesigning the boxes, cutting engineering costs and speeding marketing, it said.
The U.S. Supreme Court likely will weaken patent holders’ ability to sue companies downstream of patent licensees for infringement, while preserving a patent owner’s ability to “contract around” the doctrine by writing limits into license agreements, Stifel Nicolaus said in a note. In Wednesday Supreme Court oral argument for LG v. Quanta, Chief Judge John Roberts and Justices Antonin Scalia and Stephen Breyer “were skeptical of LG’s arguments that it should be able to recover” royalties from Quanta, which buys Intel chips using licensed LG patents, the analyst firm said. “We expect, consistent with the pattern in recent Supreme Court patent decisions, that the Court will cut back on the Federal Circuit’s grant of authority to LG to assert its patent against Quanta,” it said. However, the court will let patent holders limit licenses so they can get royalties or damages from the end buyer, the analyst firm predicted. The case has drawn the interest of major semiconductor, computer and Internet firms. Cisco, IBM, Dell, Hewlett-Packard and eBay say the first buyer of the patent technology should pay full royalty and pass the cost to its customers. Qualcomm and Yahoo support LG. A Qualcomm filing said the changes Quanta seeks could “affect significantly and fundamentally the foundations of Qualcomm’s businesses (and those of other high technology companies).” An opinion is expected by the end of June, Stifel Nicolaus said.
Wegener got a patent for technology it says will improve operation of standard-definition satellite media receivers. The technology involves stripping out and re-inserting closed-captioning, Automated Measurements of Lineups and V- chip data before sending signals to TV sets. “Most chipsets on the market don’t readily support re-inserting all this data in to the Vertical Blanketing Interval,” said Ned Mountain, Wegener’s president.
Ikanos will pay $12 million for Centillium’s DSL business, Ikanos said Tuesday. Upon the all-cash deal’s closing, Ikanos expects to hire “a portion of Centillium’s engineers,” acquire all DSL products and intellectual property rights, and expand its customer base in Europe and Japan, it said. Ikanos expects to close by the end of February but must first obtain “necessary assignments of contracts,” a spokeswoman said. Centillium’s advanced mix signal and analog technology will broaden Ikanos development capabilities, accelerating its next-generation digital home initiatives, Ikanos CEO Michael Ricci said in a conference call. Starting Q2, Centillium expects the sale to reduce operating expenses about $18 million yearly, the semiconductor maker said.