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Intel-AMD dispute threatens Globalfoundries

Posted: 18 Mar 2009     Print Version  Bookmark and Share

Keywords:joint venture  cross-licensing agreement  manufacturing operation 

Intel Corp. has notified rival Advanced Micro Devices Inc. of its intent to terminate a cross-licensing agreement between the two companies within 60 days, threatening the future of Globalfoundries, the joint venture recently set up by AMD to handle its manufacturing operations.

In a statement, AMD said Intel alleged the creation of Globalfoundries violated a 2001 patent cross license agreement between the two rival microprocessor manufacturers. Intel has asked for an immediate correction of the "alleged breach," according to AMD.

AMD denied the creation of Globalfoundries represents a violation of the agreement with Intel and said it has instituted steps to resolve the dispute.

AMD said Intel's action constitutes a violation of their cross-licensing agreement, a development that in turn gives it the right to terminate the agreement even while holding onto its rights under the deal.

"Under the terms of the cross licence, there is an escalating procedure for resolving disputes, and the company has commenced the application of that procedure with respect to Intel's purported attempt to terminate the company's rights and licences under the cross licence," AMD said.

AMD created Globalfoundries in a joint venture with Advanced Technology Investment of Abu Dhabi and under a revised ownership program will control 34.2 per cent of the foundry.

Intel's protest had been expected in some quarters and the action is not expected to immediately result in a halt in operating activities at Globalfoundries although it could complicate already tense relationship between Intel and AMD.

AMD said in its statement: "Intel's purported attempt to terminate the company's rights and licences under the cross licence itself constitutes a material breach of the cross licence by Intel, which gives the company the right to terminate Intel's rights and licences under the cross license agreement while retaining the company's rights and licences under the cross license agreement."

- Bolaji Ojo
EE Times

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