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Intel owes billions to a company that’s come back from the dead

On Behalf of | Mar 4, 2021 | Patent Law

An important part of applying for a patent is finding if the device or process is already in existence or had been previously described.

A Texas jury decided that Intel Corporation owes VLSI Technology, Inc. a little over $2 billion for patent infringement. While Intel argued that the company only blinked back into existence for the lawsuit, that didn’t change the fact that the little-known entity may still hold a valid, and infringed, patent.

Zombie corporations

VLSI was last an independent company in 1999 before it was purchased by Philips Electronics, who spun it into a subsidiary. The patents in question were issued to different companies between 2009 and 2012, then through a string of purchases and transfers, the patents found their way to VLSI the year of the suit.

VLSI currently has no products, and the decision for a tenth of Intel’s annual income would be their only notable revenue. Regardless, they currently have the patents under their umbrella, and they meet the requirements for ongoing patent protection. This furthers the notion that tracking down patents and owners can be a daunting task, but the type of owner isn’t likely to change the outcome in court.

Portfolio building

It can be difficult to foresee where an infringement allegation is going to come from.  What a company can control is its own R&D efforts and patenting processes, and the best defense is a strong offense, i.e., building a quality and defensible patent portfolio.