Cyrix Corp. v. Intel Corp., 4:92cv52.

• Decision Date: 21 January 1994
• Docket Number: No. 4:92cv52.,4:92cv52.
• Parties: CYRIX CORPORATION, Plaintiff, v. INTEL CORPORATION, Defendant, v. TEXAS INSTRUMENTS, INC., Intervenor.
• Court: U.S. District Court — Eastern District of Texas

846 F. Supp. 522

CYRIX CORPORATION, Plaintiff, v. INTEL CORPORATION, Defendant, v. TEXAS INSTRUMENTS, INC., Intervenor.

No. 4:92cv52.

United States District Court, E.D. Texas, Sherman Division.

January 21, 1994.

COPYRIGHT MATERIAL OMITTED

Albert E. Fey, David J. Lee, Laurence S. Rogers, Kelsey Nix Fish & Neave, New York City, Allan Van Fleet, Vinson & Elkins, Houston, TX, Joe W. Wolfe, Sherman, TX, for plaintiff.

James J. Elacqua, Danny L. Williams, Peter Shurn, Henry A. Petri, Jr., Arnold, White & Durkee, Houston, TX, Clyde Siebman, Plano, TX, Glen Rhodes, Santa Clara, CA, for defendant.

Ronald A. Antush, Louis Touton, Dallas, TX, Hal D. Cooper, Cleveland, OH, Larry C. Schroeder, Dallas, TX, for intervenor.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

PAUL N. BROWN, District Judge.

On November 9, 1993, the parties appeared before the Court without a jury for a trial of the licensing and patent exhaustion issues in this case, and the Court having heard all the testimony and considered all admissible evidence, as well as the argument of counsel and their proposed findings and conclusions, hereby enters its findings of fact and conclusions of law as to the licensing and patent exhaustion issues in this case in conformity with FED.R.CIV.P. 52. Any finding of fact which constitutes a conclusion of law shall be deemed a conclusion of law, and any conclusion of law which constitutes a finding of fact shall be deemed a finding of fact.

FINDINGS OF FACT

THE PARTIES

1. Cyrix Corporation (hereinafter "Cyrix") is a Delaware corporation with its principal place of business in Richardson, Texas.

2. Texas Instruments, Incorporated (hereinafter "TI") is a Delaware corporation with its principal place of business in Dallas, Texas.

3. Intel Corporation (hereinafter "Intel") is a Delaware corporation with its principal place of business in Santa Clara, California. NATURE OF THE ACTION

4. This is a patent infringement and antitrust action. Cyrix originally commenced this action against Intel on March 25, 1992, seeking a declaratory judgment of non-infringement based on license defenses and patent exhaustion. Intel, in a separate suit, sought judgment that Cyrix had infringed and induced infringement of certain of its patents. Cyrix counterclaimed seeking judgment that Intel had violated the antitrust laws and competed unfairly against Cyrix with respect to the marketing, sale and patenting of microprocessor products. Cyrix also raised affirmative defenses, including invalidity, unenforceability and non-infringement by Cyrix. TI filed a complaint in intervention seeking a declaratory judgment of non-infringement based on license defenses and patent exhaustion. The actions brought by Cyrix and Intel have been consolidated. While other Intel patents and patent claims were originally at issue, the parties agreed to dismissal of all of Intel's patent claims except those that relate to claims 2 and 6 of U.S. Patent No. 4,972,338 ("the '338 Patent").

5. The Court signed an Order on September 22, 1993, bifurcating the patent exhaustion and licensing issues in this action for trial. These issues were set for trial on November 9, 1993, and the issues tried were whether the doctrines of patent exhaustion, implied license and/or legal estoppel bar Intel from charging Cyrix or its customers with infringing the '338 Patent based on the use or resale of microprocessors made and sold to Cyrix by or on behalf of SGS-Thomson Microelectronics, Inc. (hereinafter "ST") and TI.

THE PARTIES' STIPULATION

6. The parties are in agreement that the license agreements in effect between Intel and ST and Intel and TI include rights under the '338 Patent so that both ST and TI have the right to make, use and sell the invention covered by the claims of that patent.

7. For purposes of this trial the parties stipulated, in pertinent part, as follows:

1. Subject to the provisions for relief set forth in paragraph 4 below paragraph 4 of the stipulation is not material to this trial and is, therefore, not set forth, Intel stipulates to the following facts:

a. The commercial transactions between SGS-Thomson and Cyrix and between Texas Instruments and Cyrix, in which silicon wafers containing integrated circuit chips covered by any of the device claims are fabricated by SGS-Thomson or Texas Instruments and sold to Cyrix, constitute authorized sales that exhaust Intel's rights under its device claims. Intel v. ULSI, 995 F.2d 1566 at 1569 (Fed.Cir.1993); Cyrix v. Intel v. SGS-Thomson, 803 F.Supp. 1200 at 1206, 1211 (E.D.Tex.1992).

b. More specifically for purposes of the November 9 trial, the commercial transactions between SGS-Thomson and Cyrix and between Texas Instruments and Cyrix, in which silicon wafers containing integrated circuit chips covered by claim 1 of U.S. Patent No. 4,972,338 are fabricated by SGS-Thomson or Texas Instruments and sold to Cyrix, constitute authorized sales that exhaust Intel's rights under claim 1.

2. Subject to the provisions for relief set forth in paragraph 4 below, Intel stipulates that the legal conclusions made in the Intel v. ULSI and Cyrix Corp. v. Intel Corp. v. SGS-Thomson decisions are applicable to the commercial transactions as described above in paragraph 1 between SGS-Thomson and Cyrix and between Texas Instruments and Cyrix with respect to the device claims and, more specifically, with respect to claim 1 of U.S. Patent No. 4,972,338.

THE TECHNOLOGY

8. "Memory management" is the process by which a computer or microprocessor determines which programs and data are in external memory at any given time, and where those programs and data are located in that memory.

9. "Segmentation" is a memory management technique that divides external memory into variably sized regions called "segments." Segments are accessed by a microprocessor using "segment descriptors" stored in a "segment descriptor table" in external memory. Each segment descriptor specifies, among other information, the starting or "base" address in external memory, and the length of the segment or the "limit" of an associated segment.

10. "Paging" is another memory management technique that divides external memory into regions called "pages." Pages, which typically are of the same size, are accessed by a microprocessor using "page table entries" stored in a "page table" in external memory. Each page table entry specifies, among other information, the starting address in external memory of an associated page.

11. A "microprocessor" is an integrated circuit version of a central processing unit ("CPU"). A microprocessor typically includes circuitry for fetching, decoding and executing instructions and data from external memory, managing memory, performing arithmetic and logic, and interfacing to external memory. The microprocessor forms the "brain" of a personal computer.

12. The instructions and data which a microprocessor uses to perform its functions are stored in memory external to the microprocessor. Microprocessors thus require external memory (also called "main," "primary" and "RAM" memory) in order to function. Without external memory, a microprocessor has no practical use.

13. Microprocessors execute programs from external memory.

14. An "application program" is a program or set of programs used to accomplish a specific task that the user desires the computer to perform. Examples of application programs are word processing programs like WordPerfect, spreadsheet programs like Lotus 1-2-3, and legal research programs like Lexis.

15. An "operating system" is a program or set of programs that provides the basic "services" used by application programs that run on the microprocessor or personal computer. The operating system within a personal computer has specific functions associated with controlling the computer.

16. Personal computers require that an operating system be loaded and running in the computer before an application program may be executed. Examples of operating systems are Windows, OS/2, UNIX, and DOS.

THE '338 PATENT AND ITS DEVELOPMENT

17. Intel is the owner by assignment of the '338 Patent. It was granted to John H. Crawford and Paul S. Ries, is entitled "Memory Management for Microprocessor System", and was issued November 20, 1990, based on a continuation of an application originally filed June 13, 1985.

18. Intel is also the owner by assignment of United States Patent No. 4,442,484 ("the '484 Patent"). That patent, granted to Childs, et al., is entitled "Microprocessor Memory Management and Protection Mechanism," and was issued April 10, 1984.

19. The '484 Patent describes a memory management system that was used commercially in Intel's 286 microprocessor. That system, as implemented on the 286 microprocessor, included a segmentation unit for translating a virtual address to a physical address with the segment descriptors being stored in an external memory.

20. John Crawford, one of the named inventors on the '338 Patent, started work with Intel in August 1977, and at that time, he had received a bachelor's degree and master's degree in computer science.

21. From August 1977 to the end of 1981, Mr. Crawford worked at Intel as a computer programmer developing programming tools for the 8086 microprocessor. In early 1982, he transferred to the microprocessor design group where he became the first person to start work on Intel's 80386 microprocessor.

22. Mr. Crawford was the chief architect of the 80386 microprocessor which is a physical embodiment of the '338 Patent. As the architect, he wrote the specification for the product and worked with the chip design team to ensure the product would ultimately meet that specification.

23. At the beginning of the 80386 microprocessor project, one objective was to make the 80386 fully compatible with the 80286 and 8086 microprocessors that were earlier products in the Intel microprocessor product line. A second goal was to extend the 8086 and 80286 16-bit architecture to a...