Is Rambus the inventor of a speedy new memory technology that deserves to be paid for its innovation? Or did the Los Altos company deliberately dupe memory makers to use its products without telling them they would eventually cost them dearly? These questions went to a federal jury Tuesday in a closely watched and potentially critical case that could determine whether the companies that manufacture memory chips for computers fork over hundreds of millions or perhaps billions of dollars.
The case is now before a jury to decide, and experts are divided on the outcome. Dan Prywes, an antitrust attorney in Washington, D.C., who represented the standards-setting body in an earlier Rambus case before the Federal Trade Commission, said he is convinced the company acted inappropriately. He also noted that potential royalty payments may be curtailed by new memory technologies coming to market. The FTC ruled unanimously in 2006 that Rambus used unlawful tactics to obtain monopoly power. Regulators limited the company's royalties as punishment, though the case is on appeal. Other observers say the potential for Rambus is huge. Michael Cohen, an analyst at Pacific American Securities in San Diego, estimates royalty payments to Rambus could reach $11.7 billion for the period 2000 to 2021.