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UPDATE 2-Qualcomm, others found to infringe Tessera patents

* Patents involve packaging of electronic chips

* ITC prohibits some imports, issues cease/desist order

* Qualcomm disappointed, counsel mentions appeal option (Adds Tessera and Qualcomm reaction, background on dispute, byline)

WASHINGTON, May 20 (Reuters) - Qualcomm QCOM.O, Motorola MOT.N and others infringed Tessera Technologies' TSRA.O patents for methods to package semiconductor chips so they are protected inside portable devices, the U.S. International Trade Commission said on Wednesday.

The commission issued an order to prohibit importation of chips which infringe the Tessera patents. It also issued a cease and desist order to stop infringement.

Tessera's suit was against ATI Tech, a unit of Advanced Micro Devices AMD.N; Freescale Semiconductor [FSLSM.UL]; Motorola; Qualcomm; ST Microelectronics N.V.; Spansion Inc SPSNQ.PK and Spansion LLC.

Qualcomm, a wireless chip supplier, has said that it had previously purchased its chip packaging from a variety of suppliers but has now shifted to buying all of them from Amkor Technology AMKR.O, which licenses technology from Tessera.

Motorola, which has struggled in recent years to stem sharp market share declines, has reached a deal with Tessera to enter into a pre-negotiated license to use the technology.

The ITC is a U.S. trade body that hears patent cases involving imports, among other things.

Tessera, a developer of technologies for wireless and other high-tech products, asked the ITC in April 2007 to block imports of certain chips, arguing that they infringed on its patents.

Tessera filed similar lawsuits in Texas and in California, which have been stayed.

“This is a powerful victory for Tessera and the rights of patent holders everywhere,” Tessera Chief Executive Henry Nothhaft said in a statement. “The ITC’s decision establishes that the patents in this case are valid and enforceable.”

The commission’s decision reverses a ruling made by an ITC administrative law judge in December that Qualcomm and others did not infringe on Tessera’s chip-packaging patents.

Qualcomm said it was disappointed, having thought the administrative law judge’s ruling was sound. “Obviously an appeal is probably in our future,” Alex Rogers, Qualcomm’s senior vice president and legal counsel, told Reuters.

Last month, Qualcomm ended four years of legal battles with Broadcom BRCM.O, agreeing to pay its smaller rival $891 million over four years.

In July 2008, Qualcomm signed a patent agreement that ended three years of legal battles with Nokia NOK1V.HE, the world's top cell phone maker. (Reporting by Diane Bartz; Editing by Tim Dobbyn)

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