New Intellectual Ventures Suit Seeks Payment From Chipmakers

Intellectual Ventures, the world’s biggest patent-holding company, has sued a second set of companies, claiming its giant cache of intellectual property includes patents that give it the right to collect royalty payments on DRAM, the most common type of computer memory. That means IV is attempting to collect licensing fees on a huge array of electronic devices sold in the U.S. The defendants include some of the world’s biggest computer makers, including Dell, Hewlett-Packard (NYSE: HPQ), Asus, and Acer; as well as two huge retailers, Wal-Mart (NYSE: WMT) and Best Buy.

Intellectual Ventures was founded by ex-Microsoft (NSDQ: MSFT) CTO Nathan Myhrvold back in 2000, and the company says it has accumulated more than 30,000 patents over the years.
In December, IV started filing lawsuits based on those patents, suing nine companies. (There have also been lawsuits brought by other patent-holding companies using patents purchased from IV, but the December suits were the first ones with a direct tie back to IV.)

The primary targets of this new IV lawsuit are Hynix and Elpida, two of the largest DRAM manufacturers. The litigation also includes eight other tech companies: Acer, Asus, ADATA Technology, Dell, H-P, Kingston, Logitech, and Pantech Wireless, all of which make devices using DRAM from Hynix or Elpida. Also included in the suit are two large retailers, Best Buy and Wal-Mart, accused of selling products with infringing Hynix or Elpida chips.

More than anything, this new suit puts Silicon Valley on notice that IV isn’t going anywhere, and its days of striking licenses “quietly”–by avoiding litigation–are over. In the suit, IV says that it tried to license to license its patents to Hynix throughout 2009 and 2010, but without success. It initially contacted Elpida in 2009 and tried to strike a licensing deal throughout 2010.

As big as Hynix and Elpida are, the use of DRAM is ubiquitous in technology of all kinds, from large computer systems to the smallest iPod. The fact that IV believes it’s owed royalty payments for all of these devices suggests the size of the company’s ambitions. There could be many more targets for IV to go after with these patents.

In the complaint, which was filed Monday in federal court in Seattle, IV states that it has earned more than $2 billion in licensing fees since it was founded.

Of the five patents IV is using in this lawsuit, four were originally granted to Cirrus Logic. Patents originating at Cirrus were also used in IV’s December lawsuit.