Intergraph and Intel have announced that they have entered into an agreement that settles the longstanding litigation pending in Alabama . The agreement was reached during the course of court-ordered mediation between the companies in their pending patent infringement litigation in Texas.
Under terms of the settlement agreement, Intel will pay $300 million to Intergraph, the lawsuit pending in Alabama will be dismissed, the companies have signed a cross license agreement, and Intergraph will sell certain unrelated patents to Intel.
In the Alabama suit, filed November 1997, Intergraph sued Intel for patent infringement and violation of state tort and contract laws. The Texas trial will occur as scheduled, beginning July 1, 2002.
The agreement establishes a range of liquidated damages for the pending patent infringement suit in Texas. The liquidated damages range from zero if Intel prevails to $150 million if Intergraph prevails at trial, and an additional $100 million if Intergraph prevails on appeal and Intel is unable to prove a workaround to the infringement. In the Texas case, filed in July 2001, Intergraph sued Intel for patent infringement.
Intergraph chairman and CEO Jim Taylor stated, Intergraph has been building its portfolio of intellectual property for 30 years. We believe that this settlement demonstrates the validity and value of our patents. Now that we have resolved the Alabama litigation, we can realize additional value for our intellectual property through open licensing agreements with others in the computer and electronics industries. Taylor added, The settlement also establishes a current value for the parallel instruction computing (PIC) patents at issue in the Texas suit. If we succeed in that case, the liquidated damages will enable us to realize the value of the PIC patents immediately, rather than having to rely upon the commercial viability of future Intel products in years to come.