Rambus is on a roll.
An appeals court threw out a 2007 Federal Trade Commission ruling Tuesday that found Rambus Inc. violated antitrust laws. A three-judge panel from the U.S. Court of Appeals for the D.C. Circuit ruled that the FTC failed to "establish its claim that Rambus unlawfully monopolized the relevant markets."
The decision comes just weeks after a jury trial win for the Los Altos, Calif., memory chip developer in San Jose federal court against a group of chipmakers over the same issues.
The FTC and the manufacturers claimed that Rambus violated antitrust laws when it patented ideas that were discussed at standards-setting meetings on dynamic random access memory, or DRAM, in the 1990s. Rambus then sued the companies for patent infringement when the standards were adopted.
The appellate panel expressed "serious concerns" about some of the evidence the FTC relied on. The FTC also failed to demonstrate that Rambus "inflicted any harm on competition," wrote Senior Judge Stephen Williams in the unanimous decision.
"This does vindicate Rambus and what we've been saying all along," said Thomas Lavelle, Rambus' general counsel. "It eliminates the drumbeat that the manufacturers have been using for years that we were the misbehavers."
Lawyers from Wilmer Cutler Pickering Hale and Dorr argued the case for Rambus. A spokeswoman for the FTC said that the agency is reviewing the opinion and declined to comment further.
In March, a San Jose jury rejected claims by Hynix Semiconductor Inc., Micron Technology Inc. and Nanya Technology Corp. that Rambus violated antitrust laws. A lawyer representing Hynix did not return calls seeking comment on the latest ruling.
There are still several other cases pending between Rambus and other chipmakers, but the latest win over the FTC simplifies the company's huge patent battle, said James Hopenfeld, an IP partner from Ropes & Gray who was not involved with the case.
"To the extent that Rambus has to overcome hurdles, they're going to be in the courts and not in the agencies," Hopenfeld said. "Rambus should be happy because they're not fighting a two-front war."
Although the panel remanded the case to the FTC, Hopenfeld said the message from appellate panel in the decision is "we don't want anymore fighting on this."
Michael Cohen, an analyst who covers Rambus for Pacific American Securities and also holds 500 shares of Rambus stock, said the latest ruling could force the manufacturers to the settlement table.
"One of the main backdrops of this war is that it may end in a settlement," Cohen said. "This appears to take a lot of hope out of the manufacturers' cause which may make them more willing to settle."
Tuesday's ruling raised questions about the FTC's conclusion that if Rambus had disclosed its plans, the standards-setting body would've used different technology or at least arranged for a reasonable licensing program. The FTC had placed a cap on Rambus' royalties as a result.
Judge Williams wrote that there wasn't sufficient evidence to claim that the standards organization would have gone with different technology. He also wrote that "deceit merely enabling a monopolist to charge higher prices than it otherwise could have charged ... would not in itself constitute monopolization."
On top of that, the panel had doubts about some of the evidence that Rambus engaged in deceptive conduct.