Rambus Loses $4 Billion Lawsuit

Rambus Inc. (NASDAQ:RMBA) lost a $4 billion antitrust lawsuit against Hynix Semiconductor Inc. and Micron Technology Inc. (NASDAQ:MU).

The loss of lawsuit has reduced the value of the company by more than half as the stocks of Rambus Inc. were abandoned by investors. Rambus Inc.’s, the technology and property licensing company involved in design, development and licensing of patented technologies and inventions which are essential for digital electronic products,  shares fell by 61.6 percent where as the shares of Micron went up by almost 24 percent after the verdict of the antitrust lawsuit was announced on Wednesday. The lawsuit was under trail for about three months in the state court followed by more than eight weeks of deliberations by the jury.

Rambus attorneys had claimed that the South Korean based Hynix Semiconductor Inc. along with Idaho based Micron Technology Inc. colluded together to decide the prices of the memory chips that are used in personal computers preventing the widespread usage of Rambus technology and the company had also claimed that the collusion by these two companies has cost Rambus more than 44.38 billion in profits.

In response to Rambus’ allegations, Micron and Hynix argued that there were numerous technical problems with the chip technology developed by Rambus and the company is blaming others for its own failures. After the verdict the lawyer for Hynix, Ken Nissly said that the company is pleased with the outcome of the lawsuit and there was no conspiracy as claimed by Rambus which failed to prove anything during the course of the lawsuit. The chief executive officer of Rambus, Harold Hughes said that the company is reviewing the available options for appeal as Rambus does not agree wit several rulings which seem to have affected the way case was presented to the jury.

Rambus earlier had a value of about $2 billion in the stock market before the verdict was passed. If Rambus had won the lawsuit and was awarded the damages, the company’s fortunes would have changed. A major part of the company’s income comes from litigations defending its patents, and many court battles were closely followed by investors.

The antitrust trial does not seem to have any impact on the company’s patent portfolio or existing licensees. Samsung Electronics has an agreement with Rambus lasting until early 2015 and in the previous year, Rambus had settled antitrust claims against Samsung in a deal worth up to $900 million to the company.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.