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Monday, July 15, 2024 | Back issues
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Rambus Loses Micron Case for ‘Obstructive’ Conduct

(CN) - When Rambus destroyed documents as part of an aggressive campaign to file for patents and reap royalties in the high-speed memory chip industry, it rendered many of those patents unenforceable, a federal judge in Delaware ruled.

Rambus licensed its dynamic random access memory (DRAM) technology to DRAM makers in the early 1990s, hoping its DRAM technology would be widely adopted throughout the industry.

But partnerships soon turned to skepticism, with Rambus growing increasingly worried that DRAM makers were using its technology to develop competing products.

It devised a plan to create a "patent minefield" that would force competitors to cough up royalties or face litigation, the ruling states.

Rambus' attorneys aggressively pursued patents and began building cases against potential defendants, including Samsung, Fujitsu, Hitachi and Micron.

One of its strategies included a "document retention policy," which limited how often files were backed up, how long they were kept and where they were stored. Sept. 3, 1998, was dubbed "Shred Day," and Rambus employees were instructed to shred documents in preparation for the "upcoming battle."

The plan seemed to be running smoothly, and in October 1998, Intel announced plans to invest $500 million in Micron for the production of Direct RDRAM, using Rambus technology.

Rambus attorneys urged the company to "not rock the direct boat," and instructed outside counsel to "clear out" Rambus' patent litigation files on Micron. Another "shred day" occurred on Aug. 26, 1999.

Rambus then determined that a court win against a DRAM manufacturer would lend more leverage power to its intellectual property. It targeted Hitachi and won a settlement.

In the aftermath, Micron CEO Steve Appleton filed for a declaration of unenforceability. But during discovery, Micron learned that Rambus had shredded much of its patent-related material.

U.S. District Judge Sue L. Robinson called Rambus' litigation conduct "obstructive at best, misleading at worst."

She concluded that all documents purged after December 1998 had been "intentionally destroyed," and sanctioned Rambus by declaring its patents unenforceable.

"The spoliation conduct was extensive," Robinson wrote. "When considered in light of Rambus' litigation conduct, the very integrity of the litigation process has been impugned."

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