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Advanced Micro Devices Inc. v. Altera Corp.

April 07, 1999

ADVANCED MICRO DEVICES, INC., PLAINTIFF-APPELLANT,
v.
ALTERA CORPORATION, DEFENDANT/CROSS-APPELLANT.



Before Newman, Schall, and Bryson, Circuit Judges.

The opinion of the court was delivered by: Per Curiam.

NOTE: Pursuant to Fed. Cir. R. 47.6, this Disposition is not citable as precedent. It is a public record. The Disposition will appear in tables published periodically.

Opinion for the court filed PER CURIAM. Dissenting opinion filed by Circuit Judge BRYSON.

Advanced Micro Devices, Inc. (AMD) appeals the judgment of the United States District Court for the Northern District of California *fn1 holding that Altera Corporation has a license under the eight AMD patents asserted against it. Altera has filed a conditional cross-appeal with respect to the court's determination that five of Altera's patents are licensed to AMD. We reverse the judgment that the eight AMD patents at issue are included in the license to Altera, affirm the judgment that the five Altera patents at issue remain licensed to AMD, and remand for appropriate further proceedings.

DISCUSSION

In early 1987 Altera and Monolithic Memories, Inc. (MMI) settled various patent disputes by entering into a cross-licensing agreement ("Agreement" or "Altera-MMI Agreement") concerning certain existing patents and pipeline inventions, as described in Article I:

Section 1. "MMI PATENTS" means U.S. Patent 4,124,899 and any reissues, continuations, reexaminations and divisionals thereof, and all corresponding patents in all countries of the world issued or to be issued, and all other patents of all countries of the world having claims covering programmable or reprogrammable logic devices or parts thereof or a process or processes for making such devices now owned or to be owned by MMI and having a first filing date prior to two years after the date of entry of judgment by the court terminating the present litigation.

Section 2. "ALTERA PATENTS" means patents of all countries of the world issued or to be issued having claims covering programmable or reprogrammable logic devices or parts thereof or a process or processes for making such devices now owned or to be owned by Altera and having a first filing date prior to two years after the date of entry of judgment by the court terminating the present litigation.

Article III '2 provided that a successor to the entire business of either company could succeed to the Agreement if it "agree[d] in writing to become bound" by the Agreement:

Neither party shall assign or otherwise transfer, without the written consent of the other party, this Agreement or any license or right granted hereunder or any interest herein, or grant any sublicense for any purpose, and any such assignment or transfer or sublicense shall be null and void; provided however, that the licenses and rights granted hereunder to either party shall pass to any assignees for the benefit of creditors of such party and to any receiver of its assets, and shall be extendible to any person, corporation, or other entity succeeding to its entire business and good will in LICENSED PRODUCTS of either party if such assignee or successor shall without unreasonable delay agree in writing to become bound by this Agreement.

Article VII '1(d) provided that:

Later in 1987 AMD acquired MMI and its entire business, and in 1988 merged MMI into AMD. AMD's general counsel then wrote to Altera, stating:

Pursuant to Article III, Section 2 of the Agreement, AMD hereby notifies Altera that AMD is succeeding to MMI's rights and obligations under the Agreement and agrees to be bound by the terms of the Agreement.

In 1995 AMD sued Altera asserting infringement of eight AMD patents, none of which had been acquired by AMD in the merger with MMI. Altera raised the defense of license, based on the Altera-MMI Agreement and the general counsel's letter quoted supra. Upon the district court's determination that the phrase "agree in writing to become bound by this Agreement" in the Altera-MMI Agreement was reasonably susceptible to more than one meaning, the issue was presented to a jury. The jury found that AMD, upon agreeing to become bound by ...


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