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Tessera wins round in chip patent fight

WASHINGTON (Reuters) - A U.S. appeals court ruled in favor of Tessera Technologies Inc in a chip patent dispute with Qualcomm Inc, Spansion Inc, Freescale Semiconductor Inc, ATI Technologies and STMicroelectronics NV.

Shares of Tessera, a developer of technologies for wireless and other high-tech products, rose on the decision, peaking at $22.30. They slipped to $22.03 in midafternoon trading, still up about 6.73 percent.

On Tuesday, the Court of Appeals for the Federal Circuit upheld a ruling by the U.S. International Trade Commission that the companies had infringed Tessera patents for methods to package semiconductors so they are protected inside portable devices.

In April 2007, Tessera asked the ITC, which hears patent cases involving imported goods, to block imports of certain chips, arguing that they infringed its patents.

The ITC agreed that Tessera’s patents were infringed.

It also issued an order to prohibit the importation of chips that infringe the Tessera patents and issued a cease-and-desist order to stop infringement. The appeals court, in its ruling, also upheld the import ban.

Both Spansion and Qualcomm said in comments that the patents in the case had expired so no import ban would be enforced.

“Today’s decision by the Federal Circuit will have no impact on our ability to continue to ship product,” said a Qualcomm spokeswoman in an email statement. “Tessera has the option of pursuing a district court action for any back damages that may be relevant to the expired patents.”

Michele Landry, Spansion vice president of communications, said in an email statement that the decision would have “little impact” on Spansion.”

“A separate case still needs to go to trial in the district court of Northern California where Tessera will need to prove that infringement and damages occurred,” said Landry.

Advanced Micro Devices Inc acquired ATI Technologies in 2006. AMD said it did not “believe (the decision) will have an impact on AMD’s current business.”

Motorola, which had been part of the original suit, had previously reached a deal with Tessera to enter into a license to use the technology.

The case is On Appeal from the United States International Trade Commission Investigation No. 337-605.

Reporting by Diane Bartz; Editing by Lisa Von Ahn, Derek Caney, Gunna Dickson, Dave Zimmerman

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