Chip maker Marvell Technology Group, best known for its energy-efficient chips used in smartphones and other devices, is ending the year on an extremely sour note after being ordered to pay one of the largest-ever patent infringement awards to Carnegie Mellon University.
A Pittsburgh jury ruled that Bermuda-based Marvell had “willfully” infringed on two hard drive innovations patented by the university more than ten years ago, leaving the judge no option but to award compensation totaling a whopping $1.17 billion.
Even worse for the company is the fact that the jury found Marvell’s infringement to be a “willful” act, meaning that the damages claim could potentially be tripled at a later date, according to Reuter’s report.
The ruling will no doubt be a serious setback for Marvell, which is attempting to use its highly efficient, ARM-based chips to take on Intel in the enterprise arena. Unsurprisingly, Marvell’s share price took a massive tumble following the news, dropping by 12.8% in just one day.
The concerned patents (here and here) case relate to an innovation called “noise predictive detection” in hard drive discs, which facilitate highly accurate recording of data sequences via noise signals. Carnegie Mellon’s lawyers said that Marvell had basically stolen its invention, including the technology in billions of chips that it sold despite not possessing a license to do so.
Carnegie Mellon launched the case back in 2009. There followed almost three years of legal wrangling before the case finally came to court last month. Marvell’s defense was the well-worn argument that the patents were invalid, meaning that it couldn’t possibly have infringed upon them. Unfortunately for the chip maker, the jury didn’t buy their argument.