Rambus Loses 7-year Patent Battle Against Micron, Hynix

Rambus suffered a painful loss in court against Micron and Hynix.

Rambus filed an antitrust lawsuit against several DRAM manufacturers back in 2004, alleging that the companies colluded against Rambus to shoot down the company's RDRAM memory technology.

Back in the late 1990s, RDRAM was the memory technology favored by Intel for its Pentium III and 4 processors. Intel heavily promoted RDRAM and even invested $300 million in Samsung's memory manufacturing to ramp up RDRAM production and bring manufacturing prices of the technology down. However, few memory manufacturers supported RDRAM due to no demand and high production prices that were substantially higher than the PC133 and PC266 modules.

Rambus accused memory manufacturers of price fixing to prevent a success of RDRAM, but a jury now determined that Rambus did not "meet its burden of proving its case against the two defendants." Micron saw it a bit differently and said that the jury simply cleared the company of "any and all liability" as the company "acted in accordance with the law and consistent with its values of innovation and fair competition in the marketplace."

It was a big blow for Rambus that wiped hopes for a $4 billion judgment in favor of Rambus; investors reacted in a panic. Rambus stock dropped from about $18.50 to $4.63 in the hours following the announcement. Shares recovered slightly and have been trading at about $8.75 on Thursday, but the judgment still wiped about $900 million from Rambus' market cap.