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Marvell: NO WAY should we have to pay jumbo $1.54bn patent judgment

Tells appeals court Carnegie Mellon Uni patent ruling was result of 'series of legal errors'

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Fabless semiconductor firm Marvell has fired the opening volley in its appeal of the record-breaking $1.5bn judgment against it in its ongoing patent dispute with Carnegie Mellon University (CMU).

"No patent infringement judgment for more than a billion dollars has ever received this Court's imprimatur, and the $1.535 billion judgment here should not be the first," the company's lawyers said in a filing with the US Federal Circuit Appeals Court last week.

Marvell has been locked in what has mostly been a losing battle with CMU ever since the university first brought suit against it in 2009.

At issue are two US patents – numbers 6,201,839 and 6,438,180 – that describe technologies used to improve the accuracy of data read from hard disks.

In its suit, CMU alleged that Marvell shipped some 2.3 billion chips that incorporated those inventions between 2003 and 2012, when US District Judge Nora Barry Fischer ruled in the university's favor.

The judge slapped Marvell with a whopping $1.17bn bill as a result of the infringement, and although the chipmaker sought to have the judgment reduced, it was ultimately raised by another $370m in punitive damages in April 2014, after Judge Fischer found that Marvell had "wilfully" infringed CMU's patents.

In its 75-page appeal filing and 360-page addendum, paper copies of which were delivered to the court on Tuesday, Marvell reiterates its earlier claims that CMU's patents are invalid and that the judgment against it is the result of a series of legal errors by the district court.

The chipmaker argues that its silicon couldn't have infringed CMU's patents because the patents in question merely describe theoretical algorithms that are "incapable of commercial implementation in a semiconductor chip."

In fact, Marvell claims, CMU approached at least 11 companies about potentially licensing these exact patents between 2003 and 2005, yet all declined, citing prior art. Intel, it says, wouldn't even license them for a flat fee of $200,000.

Marvell further argues that even if the judgment of infringement stands, the court's $1.54bn award is way out of line. That figure is based on a valuation of $0.50 for every chip Marvell sold during the disputed period, it says, even though there's no evidence that CMU ever licensed its patents on a per-unit basis, rather than for a flat fee.

The chipmaker also notes that the judgment is based on its total worldwide chip sales, when the majority of those parts were manufactured, sold, and used exclusively overseas, outside the jurisdiction of US patent law.

Finally, Marvell argues that the court should reduce the award by a minimum of $620m, owing to the fact that CMU waited six years before notifying Marvell of possible infringement. And because it had ample reason to believe that CMU's claims were invalid to begin with, Marvell says, the court's award of additional damages for willful infringement should also be vacated.

CMU has yet to file a formal response to Marvell's claims in the appeals court, but in the past it has said that it was "gratified" by the district court's ruling and the resulting award of damages. ®

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