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Digital sues Intel
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May 13, 1997: 8:15 p.m. ET
DEC chief says company became suspicious after Pentium Pro release
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NEW YORK (CNNfn) - Digital Equipment Corp. on Tuesday sued Intel Corp. claiming the company infringed on Digital's chip-making technology.
The suit, filed in a U.S. District Court in Massachusetts, charges that Intel infringed on 10 of Digital Equipment's patents in designing and selling its Pentium, Pentium Pro and Pentium II microprocessors.
Digital is seeking an injunction which would stop Intel from using Digital's technology in its present and future products. Digital is also looking for monetary damages for what it claims is Intel's "willful violation of the patents."
Intel officials were not immediately available for comment.
The patents cited in Digital's lawsuit are related to technologies in cache management, branch prediction and high-speed instruction processing. Those patents were filed between 1988 and 1996.
Digital Chairman Robert Palmer, speaking on CNNfn's "Digital Jam," said his company became suspicious with the release of Intel's Pentium Pro chip.
"It had a remarkable improvement in performance over previous X86 chips. At that time, I asked our general counsel to make a rigorous and thorough evaluation of Intel designs and Digital's patent portfolio."
Palmer denied that his company was emboldened to take on Intel, which controls 85 percent of the semiconductor market, due to the release of Advanced Micro Device's K6 chip last month. (157K WAV) or (157K AIFF)
Palmer said he was confident that the lawsuit would not mean the end of Digital Equipment's business relationship with Intel, especially since his company has recently released a line of products based on Intel's new Pentium II chip.
One analyst questioned Digital's chances to win the suit.
"It's clear that Digital has not been able to beat Intel in the marketplace, and now they're trying to do it through a patent suit," said Eugene Glazer, technology analyst at Dean Witter Reynolds. "It's extremely difficult for Digital to win on something like this."
In Tuesday trading, Digital (DEC) shares ended up 2-1/4 at 35-3/8 while Intel (INTC) fell 6-3/4 to 152-3/8.
Digital, based in Maynard, Mass., makes systems which run on not only Intel's chips but also its own Alpha microprocessors. The company also makes storage systems, networking systems and design software and offers computer services. 
--Randy Schultz
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Digital Equipment
Intel
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