ITC Judge Invalidates Rambus Patents for Prior Art, Calling Former Executives 'Dishonest'

Rambus has taken a lot of losses in its litigation against semiconductor industry rivals. The latest hit came on Friday, when a International Trade Commission judge called former Rambus execs “dishonest” and “unreliable” witnesses, and added that “not since the long ago era of the Watergate hearings have the words ‘I don’t recall’ been used so regularly in answering questions under oath.”

ITC judge Theodore Essex released a 380-page opinion on Friday that invalidated five Rambus patents because of prior art. Rambus had asserted the patents against six leading semiconductor manufacturers — LSI, MediaTek, STMicroelectronics, NVidia, Broadcom, and Freescale — as well as more than 30 of their downstream customers, including Motorola and Hewlett-Packard. Essex’s ruling, which elaborates on a March 2 initial determination, also found Rambus’s patents unenforceable on the grounds that its former execs gave “dishonest” testimony about whether they condoned the shredding of documents in anticipation of litigation.

The ruling is a win for Quinn Emmanuel Urquhart & Sullivan, which served as lead counsel for five of the six manufacturer-defendants. (The loner, LSI, was repped by Kilpatrick, Stockton & Townsend). Several other firms contributed to the defense. Rambus relied on Finnegan, Henderson, Farabow, Garrett & Dunner.

Rambus brought suit at the ITC in 2010, seeking import bans on a wide range of memory processors. At a two-week trial before Essex in October 2011, Quinn’s Charlie Verhoeven argued that the six patents were invalid on the merits. Meanwhile, his partner William Price, who had just gone up against Rambus in a much-publicized three-month antitrust trial, argued that Rambus had unclean hands because of a company-wide “shred day” and “all day shredding party” in the late nineties. (Rambus vice president Joel Karp used those cringe-worthy words in internal documents at the time. They’ve been coming back to haunt Rambus in court ever since.)

NVidia and Broadcom struck deals after the October trial. Because the case went poorly for Rambus, the company “had an incentive to settle at fire-sale prices,” says Mike Bettinger of K&L Gates, who helped represent STMicroelectronics. His client, along with LSI and MediaTek, refused to settle and pinned their hopes on a complete defense win.

The hold-out defendants got what they were hoping for, and then some. Essex wrote that VP Karp’s “inability to remember anything that might hurt Rambus, coupled with selective memory regarding things he considers helpful, rendered him as unreliable a witness as could be presented.” And regarding former CEO Geoff Tate, Essex said: “Not only does Mr. Tate not recall the events that went on to make him personally, and his company, a great deal of money, but he does not even attempt to cooperate as a witness.”

Essex’s opinion will be automatically appealed to a full panel of ITC judges. They will hear the case de novo, but should “approach whatever evidence Rambus cites in its appellate brief with skepticism,” says Quinn’s Price.

Finnegan partner Doris Johnson Hines, who represents Rambus, declined to comment. Rambus spokeswoman Linda Ashmore did not reply to an e-mail seeking comment.

This article originally appeared in The Am Law Litigation Daily.