- Sunday, 12 July 2009
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I'm astounded you guys [analysts] tolerate their [Intel's] margin collapse - W.J. Sanders III
DRAMurai bacon saved
IN WHAT punters thought to be an open-and-shut case in favour of Rambus, the District Court of Delaware has ruled for the defendant, Micron, having decided Rambus wasn't very honest on how it went about its business.
That kind of about face might sound strange, but according to Judge Robinson, Rambus did everything it could to appear the innocent victim when it was really working the case for litigation against the world's biggest DRAM makers.
The trick, it seems, was to impose hard-to-swallow royalties on the DRAMurai just to get them to refuse payment and then litigate their way, impose royalties and compensation. Prep work for litigation began *before* Rambus approached DRAM makers, and company execs determined that killing off one of the DRAMurai in litigation would serve as an example to the rest. Unfortunately Rambus esquires were made a bit red in the face as this was revealed by witnesses and court documents.
Rambus' cunning plan boiled down to presenting DRAMurais with two options: licensing on Rambus' terms or litigation, in the hope that they refuse the licensing fees. The first four DRAMurai (Hitachi, Toshiba, OKI and NEC) fell unto the Rambus licensing onslaught - that carried with it the weight of Intel's adoption of RDRAM as the future of memory on the PC. But when they reached Micron's doorstep, they saw the Idaho boys polishing off the brass knuckles and getting ready for a scrap.
Micron was to serve as an example for the remaining DRAMurai. The fact that they were Rambus' biggest allies when RDRAM was Intel's choice RAM and then turned tail, is just a coincidence.
Unfortunately, it would've been quite a one-sided fight if Rambus hadn't shot itself in the foot thanks to shoddy housekeeping.
According to the court, Rambus took sure steps to create a "document retention system" policy and, instead of taking employees out on company picnics, held "Shred days" at the office to get rid of documents that would surely be ill-perceived in court. Rambus denied, hesitated, admitted it had implemented such policy and, finally, was derelict in producing the documents. The court transcript reveals over the course of one of the three shred-days alone, Rambus shredded a small rainforest's worth of paper (400 boxes, to be precise).
Based on this attitude and the inability to produce the evidence (spoliation of evidence), the court ruled in favour of Micron.
So what next? Rambus loses against Micron although it gets to appeal. It also sees some of its leverage in other cases go out the door. There are other trials regarding DDR2 and DDR3 that are hovering around and in one analyst's words: "If (the) California trial is delayed RMBS will have to wait probably another 1-2 years before it can collect royalty from DDR2".
You can imagine how this has gone down amongst investors right now. Analysts and general know-it-alls in the business are saying Rambus will settle for a less than investor-pleasing royalty of 2 per cent with the DRAMurai, while having damages on other related trials reduced by a fair amount.
Guess what happened to RMBS stock when the ruling came out? µ
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Some days chicken. Some days feathers.
Rambus, the inventor of all dynamic computer memory, has had its IP stolen by the DRAMurai and it wants to get paid for its invention. Sort of like Thomas Edison and electric bulbs. Heard of him?
Pretty simple really except for a few dense judges and the FTC (all reversed so far).
This will work out in the end. Have your reporters follow this story. It will end very well for Rambus and its investors.
(As a resource for those who are interested, look at investorvillage.com)
Funny, I was at a tech training conference at the residence inn behind the rambus headquarters and we noticed a huge shredding truck parked in front of it every day.
pk de cville:
"Rambus, the inventor of all dynamic computer memory"? Rambus were founded in 1990. Dynamic RAM was invented by IBM in 1966. You are wrong.
Regarding Rambus, ISTM that they are lucky to escape jail. Shredding stuff youre legally required to keep and then lying about it on oath sounds like a pretty major contempt of court to me.
They certainly seem to lead a charmed life, dont they?
Couldn't have happened to a nicer company. Finally what goes around is now coming around, and I can't think of one company that deserves it more. I hope the trend continues and Rambus' Profit-by-litigation business model is finally put out of business. Here's a little history for the uninformed: http://www.gtwassociates.com/alerts/Rambus.htm Coincidentally Rambus dropped out of the JEDEC standards body/committee right around the same time a similar patent case was found against Dell.
Time to have Bacon and Eggs, as rambus stock will soon be cheap like eggs.
hmmm but if I had rabus stock i would shred that then use it as kitty litter. As having rambus stock is a shitty deal.
Can we be as done with RAMBUS now as we are with SCO? They can easily be prosecuted for fraud now, since it can be proven that their entire strategy to sue was created before they even approached the DRAMurai about licensing. Maybe the DRAMurai should gang up on them now and sue them for fraud so they can be put out of their mysery. In After hours trading, RAMBUS is down to $11.36. LOWER PLEASE??
Obviously Rambus and its lawyers didn't read 18USC1519 which makes it a criminal felony a la Enron now "Section 1519 makes it a crime knowingly to destroy a document with the intent to obstruct or influence “the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States . . . or in relation to or contemplation of any such matter or case.” destruction of documents that would be produced in the course of litigation in federal court fall within this new provision included in Sarbanes-Oxley. Wonder who on Rambus's board of directors and what company officers need to pack their toothbrushes. pk de cville obviously isn't familiar with the new criminal penalties for obstruction of justice. What you get for practicing law without a license or using civil attorneys who are unfamiliar with the US criminal code. Maybe he/she should go along for company to the Federal Bureau of Prisons.
"Rambus, the inventor of all dynamic computer memory, has had its IP stolen by the DRAMurai and it wants to get paid for its invention."
It was NOT stolen. It was more like a bait-and-switch con job. Rambus attended the JEDEC meetings regarding the adoption of DDR1 as a standard and offered up the technology for use after having already applying for patents on it which they did not mention. Once it was adopted they then said, "by the way, we have patented that technology and here's what the royalty terms are..." That is what started the legal battles.
Personally, I am damned glad to see Rambus get in the ass and I hope the courts do NOT let them off easy !
I am most definitely a proponent of innovation and intellectual property rights but in this instance Rambus is trying to a pull of a swindle and I find it and them detestable.
I agree with most others who posted.
Don't fret too much for Rambus. They set up these bait and switch intellectual property grabs intentionally so they can knock em' down quickly for profit. They have been doing this for years, it's their modus operandi.
You sir, are a troll. Go back to Slashdot where you belong and let people who deal in facts discuss in peace over here.
The only winners in this battle are lawyers. Guess who is laughing now.